Local Tax Codes

Use the Local Tax Codes page to add, update, delete, search, and print local tax code records for payroll tax withholding. This page allows users to define local income tax jurisdictions (cities, school districts, and other localities) with their associated tax rates, exemptions, and vendor information. The data is used during payroll processing to calculate and withhold local income taxes from employee paychecks and is essential for Ohio W2 reporting.

When adding or changing employee local tax information, you must set up a table for each municipality you anticipate needing for the Location Code field. Contact your local Earned Income Tax office for details on applicable tax rates and regulations.

Use the Future Local Tax page to update your Local Tax records accordingly as local rates change. This option allows you to modify table records without affecting live data until the specified effective date. For more information, refer to Future Tax Table Options.

On the start page, select Human Resources.
Select Reference Tables.
From the Payroll menu, select Local Tax Codes.
Enter the Search Criteria to find the required local tax records, and then select Search.
Refer to Search for records for more information.
- To add a record, select Add new. Refer to the Field descriptions, enter valid information, and select Accept.
- To edit a record, select the record and select Accept. Update the information and select Accept.
- To delete, select the record and select Delete. Select Yes.
- To generate a report, select Print, and then select a Destination:
  - Select File to create the report in .rpt format. The default file name is localtax.rpt. You can change the default file name.
  - Select Screen to download the report in .pdf format. The default file name is localtax<#####>.pdf.
  - Select Excel to download the report in .xlsx format. Select the required Excel Options. The default file name is localtaxrpt<####_#####>.xlsx.
    - Select OK.
      - Download the .rpt file from the View Files page.
      - Save the .pdf or .xls file.
        For more information about the Print option, refer to Print Reports.

Field descriptions

The following section describes the Ohio-specific fields on the following tabs of the Local Tax Codes page:

For information about other fields on the Local Tax Codes page, refer to Local Tax Codes.

General tab

The following table describes the Ohio-specific fields on the General tab of the Local Tax Codes page.

Field	Description
Location Code	A unique alphanumeric code identifying the local tax jurisdiction. This code is used throughout the system to reference this specific local tax and appears on employee tax records, payroll registers, and reports. OH-specific information: School: Use a four-character state municipal tax code as the location code. Residential: Use a five-character residential code as the location code. Worksite: Use a five-character residential code with a W suffix to distinguish between residential and worksite.
Check Title	Enter the name of this tax as it will appear on payroll checks and pay stubs. This is the descriptive text employees see, identifying the specific local tax being withheld. The limit is 10 characters.
Subjective Gross	Select the type of gross wages used as the tax base for calculating this local tax. Valid values: TT - Total Gross FI - FICA Tax Gross MD - Medicare Tax Gross FD - Federal Tax Gross ST - State Tax Gross LC - Local Tax Gross DI - Disposable Income SP - Subject Pay Gross
Include Medicare Pickup Benefit Amount	Indicates whether to include the Medicare pickup benefit amount as additional gross for local tax calculation for deductions with P - Deduction is a Medicare pickup deduction selected in the Cafeteria Plan field on the Employee tab of the Deduction Table page. When this option is selected, the employee's Medicare pickup benefit is added to the taxable gross for this local tax.
Original Tax Rate	The original tax rate before any reciprocity agreement is applied. This applies if an employee lives in one state and works in another. This agreement between the two separate states allows an employee in one state to request an exemption from tax withholding in the state where their job is located. This is the full tax rate that would apply if no reciprocity agreement existed between the employee's work and residence localities.
Tax Rate Credit	The credit granted by a reciprocity agreement. This credit is applied against the original tax rate when an employee works in one taxing locality but resides in another taxing locality with a reciprocal tax agreement.
Local Crosswalk	The local tax crosswalk code used when importing timecards. This alphanumeric code maps timecard data to the appropriate local tax code during the import process, ensuring proper tax assignment when locality codes differ across source systems.

Vendor tab

The following table describes the Ohio-specific fields on the Vendor tab of the Local Tax Codes page.

Field	Description
Vendor Number	The vendor number of the entity to which this local tax is paid. This links the local tax to a vendor record in the system, enabling proper payment processing and 1099 reporting to the taxing authority. Select the Lookup icon to search for and select a vendor number.
Pay Frequency	The payment frequency for remitting this local tax to the taxing authority. This determines how often the withheld taxes are remitted to the vendor (e.g., monthly or quarterly). Valid values: A - Annual B - Bi-weekly M - Monthly S - Semi‑monthly W - Weekly X - X User-defined Y - Y User-defined Z - Z User-defined Codes X, Y, and Z can be used to represent pay frequencies that are not addressed by the other selections.
Reference Code	The reference code for this local tax. This code is used for W2 reporting and may be required by the local tax agency to identify the specific tax jurisdiction on electronic and paper filings. This code must be the same across all local tax code records associated with the taxing agency. When creating the W2 local tax electronic file, ensure the following: This field contains a valid RITA or CCA Reference code. The same code is entered in the Local Tax Reference Code to Include field on the Create W2 Electronic File page. The system checks the Municipal Code field in the first Local Tax table record with that Reference code to determine whether the local tax code is RITA, CCA, or neither. If the first two characters of the Municipal Code for that Local Tax table record are R0 or W0, the W2 file is a RITA file. If the first two characters of the Municipal Code are CC, the W2 file is a CCA file. The limit is 10 characters.
Municipal Code	The municipal code required by the local tax agency for W2 reporting. This is the official code assigned by the taxing municipality that must appear on W2 forms to correctly identify the locality where the tax was withheld. This field must be populated for every local location for which the taxing agency has been entered under the Reference code. The limit is five characters.
Local FIPS Code	The local FIPS (Federal Information Processing Standards) code required by the local tax agency for W2 reporting. This is a standardized geographic code used to identify the specific county or locality on electronic W2 filings. Update this field before creating W2 records. The limit is six characters.
Locality Name	The reporting entity name required by the local tax agency for W2 reporting. This is the official name of the taxing locality as it should appear on W2 forms and other tax documents submitted to the agency. Update this field before creating W2 records. The limit is 40 characters.