Are taxes in Ohio higher than most states? (Columbus, Cleveland: for sale, real estate)

[cicilyb]

We are considering moving to the Northeastern region of Ohio. Are property taxes high there? We've been looking at realestate sites online and have noticed that property taxes are paid each 6 months and they appear to be quite high. We now live in FLorida and we pay once a year, have homestead exemption for all property owners and residences (most people consider FL property taxes to be high.). Also, how much is sales tax and is there a state income tax? Thanks for any info!

[NewToCA]

I can't address your specific questions but generally, Ohio homes have property taxes in the 1.5-2.5% of purchase price range, so if you purchase a $300 K home I would expect property taxes to be in the $4500-$7000 range. School bonds are voted by each school district, which partially explains the variance.

Don't forget, much of Ohio has city wage taxes too, generally in the 2% to 3% range. This range is due to partial credits allowed between municipalities.

The state income tax doesn't allow deductions normally allowed on Federal returns. Personal exemptions are just about the only deduction, and capital gains are taxed as ordinary income.

[Bill Marriott]

I was born and raised in Ohio. We had to move out of state due to no jobs. I had 9 rental properties owned my own business with 7 employees. I lost it all. My father told me just this morning that he saw on the news that the median house price for central Ohio has dropped from $212,ooo to $138,ooo in one year. I would do my home work before moving to Ohio! I have all my friends and family there and still do not want to move back. They are all still trying to hang on to jobs and homes.
Good luck! Bill

[bubbagirl]

I can only compare to Michigan... From what I know and have confirmed with property owners, Ohio's property tax is less. However, as mentioned, it can vary with school districts.

The income tax for my husband is half as much as Michigan's, but it may depend on your tax bracket. We know this because his employer mistaken took both states out upon starting his job last month.

Good luck on your decision! NE Ohio is a gorgeous area. The job market is slim, but certainly not impossible.

[clevelandgirl]

Ohio is the second highest taxed state in America. I'm a life long resident of Cleveland, and I loved it, it was my home town and life was good. I owned two businesses and was doing well. After 9/11 everything changed here. I lost my one business, refinanced my house to pay off the business debts, my house payment tripled in 4 years. My house is now in foreclosure. Cleveland (Cuyahoga County) has the highest rate of foreclosures in the country. My house has been up for sale since Jan., I've had 3 lookers and I live in a lovely suburb. Nothing is selling, nothing. Don't even dream of living in the city unless you want to carry a gun. Cleveland is turning into the old west. I now have crackheads, crack prostitutes scaring away my customers at my other business. I now carry a gun. Our police? Understaffed and overworked. Our mayor is LAME, a dog with no teeth. We've had 18 murders in the past 26 days. The crime rate is through the roof. Our school system is in a shambles, you've got to go private. They're trying to raise our sales tax another 1/4%. Our economy is horrible, no jobs, people getting laid off, which always increases the crime. If you consider moving here, you better think twice. Unless you're well off, the far east and west suburbs are very nice.

[clevelandgirl]

One more thing-our sales tax right now is 7 1/2%-they're trying to raise it without a vote!

[wrightflyer]

While things are certainly not rosy in Ohio, there are other cities from Orlando to Boston that suffer numerous problems ranging from costs, to crime, to taxes. NewToCA, you hit the nail on the head. That general layout is how most suburbs in Ohio work out in terms of taxes. Of course, each city will be different. Check with a realtor for more specific numbers.

One thing that I have noticed however is residents in most of Ohio's major cities (Dayton, Cincy, Toledo, Akron, Youngstown, Cleveland, Columbus) tend to be overtaxed for the level of services they recieve. Part of this is due to the population losses these places have suffered and the cities must now go to the remaining residents and workers for more money. These people don't wish or can't pay more and thus the system breaks down even further. Employers also leave due to costs. School levies fail causing districts to neglect their infrastructure (ie. books, computers, buildings) due to a lean budget.

While all of that may sound scarry, don't let it convince you all of Ohio is this way. Some places are doing better then others because they have diversified their local economies faster than others. I think NE Ohio is furthest behind most Ohio regions (ok, maybe not SE Ohio, but it was rural in the first place). Until local and state governments realize that they and their policies are the problem, a turn-around will take longer to achieve.

I'd say the one thing you'll miss will be the homestead exemption. Especially if you bought your home in Florida before the state's prices skyrocketed.

[Art1979]

Originally Posted by wrightflyer

Until local and state governments realize that they and their policies are the problem, a turn-around will take longer to achieve.

That's a very good point. I've been saying that for quite a while, or at least ever since I've worked on local businesses. That whole "more taxation to accommodate services" argument loses its potency when the tax base erodes and we're left with even less.

Let's just recap on some of Ohio's taxes:

• Ohio Sales Tax
• Ohio Income Tax (withholdings for employees & your Sch. C)
• Local Income Tax
• Commercial Activity Tax (CAT) (broken link)
• Ohio Department of Job and Family Services
• Ohio Bureau of Worker's Compensation
• School District Tax (where applicable)
• Gasoline Tax (28 Cents a gallon plus 3 cents commercial)
• Homestead
• Alcohol & Tobacco (Sin) taxes

This is not to mention the MVLR and other fees we pay to reside in Ohio. I can only see this ending up to be a vicious circle where the state is not getting enough money to operate and ends up raising taxes even more.

[Linda Pratt]

Originally Posted by Bill Marriott

My father told me just this morning that he saw on the news that the median house price for central Ohio has dropped from $212,ooo to $138,ooo in one year.

Certainly NOT true for the Cincinnati area and I can not believe that for anywhere in Ohio! As a real estate investor, I can tell you that sales may be down just a little and when that happen prices may dip slightly, but certain not by nearly half, that's ridiculous. Your dad was mistaken, or the news program got the state wrong. Good grief. Appreciation is slow and steady. We do not see the enormous jumps and drops as in other parts of the country, like southern Florida or east or west coast. No sir, not Ohio!

I have many rentals and they all have a positive cash flow! Don't know where you lived in Ohio, but I would question the business methods more so than the state. There are always a need for rentals!

[dayton_ohio]

Ohio is an interesting case study in municipal finance -- as it used to be one of the low-tax states, and now is one of the higher-tax states.

Midwestern states seem to have higher taxes (but also better amenities) than Southern states. You can find outstanding public school systems in Ohio, far more than we've found in the Southern states that we've lived in. Ohio offers a number of excellent public universities -- in a lot of low-tax states, there may be one good flagship campus. Ohio has decent snow removal in the winter, and nice state parks in the summer. There are museums and other attractions all across Ohio, some state supported and some not.

You could lump Wisconsin, Michigan, Illinois, New York, Pennsylvania and other older industrial regions in the same category. In some ways, you get what you pay for in taxation. These are all, in varying degrees (and to my tastes), better places to live than in many of the low-tax emerging states.

The poster who quoted the price decline is an alarmist. Ohio is slumping, just like almost every other state, but home values are not declining by 50% here (nor are they in California or Florida, at least yet).