Rental Property Taxes in Ohio (2026 Guide)

1. Property Tax in Ohio

Ohio property tax is county-administered and assessed at 35% of true (market) value (ORC 5715.01). The statewide effective rate is roughly 1.3%–1.6%, varying widely by district.

• Reappraisal cycle — a full sexennial (6-year) reappraisal with a triennial (year-3) update, so assessed values step up on a schedule.
• No homestead or 2.5% rollback for rentals — both the homestead exemption and the 2.5% owner-occupancy rollback require you to live in the home, so neither applies to investment property.

2. Ohio State Income Tax and the Business Income Deduction

For 2026, Ohio taxes nonbusiness income at a flat 2.75% above an exemption floor of about $26,050 (HB 96 eliminated the old top 3.125% bracket). Income below the floor is untaxed.

• Business Income Deduction (BID) — the first $250,000 of business income is deducted ($125k MFS), and business income above that is taxed at a flat 3%.
• Does your rental qualify for the BID? It depends on whether the rental rises to a trade or business (a facts-and-circumstances test). An actively advertised, managed, and maintained rental generally qualifies; an occasional rental generally does not. Treat BID eligibility as something to confirm, not assume.

3. The Bonus Depreciation Add-Back (Ohio’s Gotcha)

Ohio does not conform to federal bonus depreciation (or excess §179). If you claim §168(k) bonus depreciation federally, Ohio makes you reverse most of it up front (ORC 5747.01).

• Add back 5/6 of the federal bonus/§179 amount in the year you claim it.
• Recover it over 5 years — deduct one-fifth of the add-back in each of the next five years.
• Regular depreciation flows through — only the bonus/excess-§179 portion is reversed.

4. Real Estate Conveyance Tax

Ohio charges a state real property conveyance fee of $1 per $1,000 of value (0.1%), and counties may add a permissive fee of up to $3 per $1,000 (0.3%) — so up to $4 per $1,000 (0.4%) combined, depending on the county.

5. LLC Fees (No Annual Report)

Ohio LLCs file no annual report and pay no recurring state fee — only a one-time formation fee (about $99 for the Articles of Organization). That keeps ongoing compliance light for a rental-holding LLC.

6. Rent Control

Ohio preempts local rent control. ORC 5321.19 (effective 2022) bars any political subdivision from imposing rent control or stabilization on private residential property, with narrow carve-outs for health/safety codes and subdivision-owned or voluntarily incentivized affordable housing.

7. Security Deposit Rules

Ohio’s deposit rules live in ORC 5321.16:

• No statutory cap on the deposit amount.
• Interest — a deposit exceeding the greater of $50 or one month’s rent earns 5%/year on the excess if the tenant stays six months or more, paid annually.
• Return within 30 days of termination and move-out, with itemized deductions in writing.
• Penalty — wrongful withholding exposes you to the amount withheld plus equal (double) damages and attorney’s fees.

8. How SheltrIQ Helps Ohio Landlords

SheltrIQ keeps the federal and Ohio sides of your return aligned:

• Bonus-depreciation tracking — flags the Ohio 5/6 add-back and the 5-year recovery so federal and Ohio depreciation reconcile.
• Depreciation schedules — builds 27.5-year MACRS schedules and tracks improvements.
• AI Schedule E classification — sorts each expense to the right line so your Ohio income starts from an accurate federal return.
• Deadline reminders — keeps your federal and Ohio estimated-payment dates on track.