Your Ultimate Guide to Ohio Payroll

Employers are responsible for ensuring proper payroll withholding and remaining compliant with specific state laws and regulations. These requirements vary from one US state to another, and it’s important to understand the relevant laws and guidelines for your business.

As a payroll manager in Ohio, you must follow state-specific requirements regarding unemployment insurance, withholding personal income tax, and paying workers’ compensation. As a starting point, we’ve put together this guide to point you in the right direction.

Paying unemployment insurance

As an employer in Ohio, you are responsible for making a few key payments on behalf of your employees — for example, federal taxes such as Medicare and Social Security. In addition, Ohio employers must withhold taxes and make contributions to the federal and state-run UI program.

UI is a program designed to provide temporary financial assistance to individuals who have lost their jobs through no fault of their own. While employers pay UI, the Ohio Department of Job and Family Services (ODJFS) oversees payments and administers funds to eligible residents.

Rates range from 0.4% to 10.1% in 2025 on a taxable wage base of $9,000. New employers start at 2.7% except for the construction industry where it’s 5.6%.

Employers can manage Ohio unemployment insurance through an online portal. For more information on paying your unemployment insurance, you can consult the Ohio Department of Jobs and Family Services.

Withholding personal income tax (PIT) from your Ohio employee

Employers must withhold and manage PIT if they hire any employees in Ohio. This tax is imposed on residents of the state and deducted from their wages.

Here are the tax rates for 2025:

After deducting the fee from the wages, the employer is responsible for paying the withheld amount to the state. Payment can be made through Ohio’s online portal. The Ohio Department of Taxation provides more information on paying the withheld amount.

Paying your Ohio workers’ compensation

Workers’ compensation is a type of insurance that provides medical and wage replacement benefits to employees who suffer work-related injuries or illnesses. It is designed to protect both workers and employers by offering financial support to injured or sick employees and, in return, shielding employers from potential lawsuits related to workplace accidents.

Workers’ compensation is a prerequisite for all Ohio employees, regardless of the number of employees you hire whether they’re full-time or part-time. Unlike other states, Ohio does not allow workers’ compensation coverage from private carriers, meaning you must purchase coverage from the state.

All necessary information on registration and coverage can be accessed from the Ohio Bureau of Workers’ Compensation.

Simplify US payroll tax compliance with Deel

While this guide provides essential information on Ohio payroll taxes, payroll compliance, and state requirements extend beyond what is covered above. To streamline the process and ensure full compliance, companies can turn to Deel. 

Deel offers a comprehensive solution for managing US and international payroll, including payments, taxes, worker classification, and more. Speak with an expert today to see how you can streamline your US payroll processes and ensure compliance with state regulations.