As an Ohio resident starting a small business, you need to check your tax obligations regularly. Navigating the complicated web of local, state, and federal duties could be difficult, though this is why additional check-ins are required. However, living in Ohio, one of the payroll specialist job duties is to deduct business income taxes from workers' paychecks. Therefore, to complete the payroll process accurately, you need to be updated about the rules and regulations of Ohio business law.

Different Ways to Pay Employees in Ohio

Unemployment insurance laws do not exist in Ohio. Notably, more than 7 million Americans still need a bank account, which means that they need more than a direct payment. In this situation, both checks and credit cards are good options. With the following, you will have enough options to choose from to pay your employees.

Minimum Wage

Employers must pay workers twice a month when hired on minimum wage. Here, one of the payroll specialist job duties includes setting up automatic payments every two weeks, on the first and fifteenth of each month, or even every week or day.

Thus, the first of the next month pay for all hours performed from the first to the fifteenth. Section 4113.5 of the Ohio State Code doesn't identify any exclusions, although employment or industry codes of behavior may.

Pay Stub Laws

There are no rules about pay stubs in Ohio. However, you are expected to keep salary records for each employee for five years. These records should include the following statements:

• Pay rate
• Total pay
• Work hours
• Name, address, and job

Paycheck Deduction Rules

Ohio law allows taxes and health insurance payments to be deducted from an employee's pay as a normal deduction. Additionally, it lists the expenses that are allowed, but only after getting written permission from the employee.

• Final paycheck rules
• Savings plans or accounts
• US defense stamps & bonds
• Credit union shares or loans
• Government contributions
• Charitable gifts
• Union fees
• Political donations

You must pay a quitter or dismissed employee their final paycheck on the following payment or within 15 days. Unfortunately, you can't retain your paycheck, but Ohio doesn't require you to pay back unused paid time off. Unless your company needs it, you will not have to pay for this benefit. So, its advised that you make it part of your company's policy.

Guide to Payroll in Ohio

Ohio payroll administration includes a number of steps, such as registering your business as a job and making sure that all state and federal tax rules are followed. In this section, we have explained in depth the payroll process in Ohio:

Setting Up Your Business

Before you start handling Excel payrolls in Ohio, make sure your business is legally listed and has the right structure. You also need a unique Employer Identification Number (EIN) before you start paying people. You can complete Form SS-4 or apply online at the IRS website to get it quickly. Moreover, youll also need EFTPS accounts.

Registering with the State

It is necessary to be registered with both the State of Ohio and the Ohio Department of Taxation. For this, you must agree to follow all state tax rules, especially those that have to do with income and unemployment taxes.

You will also have to set up your account to track withholdings here. Paying the State Unemployment Tax Act (SUTA) also requires signing up with the Ohio Department of Job and Family Services and the Employer Resource Information Center (ERIC).

Setting Up Payroll Process

Create a clear and well-organized accounting method as the next step. Your choices include how often you'll pay your workers (weekly, daily, or monthly) and how you'll handle payrolls and figure out their salaries. You can use payroll software or simply use Excel payroll features. Legally, you have to pay your workers at least twice a month in Ohio if theyre hired on a minimum wage. You can pay one time on the first and the second time on the fifteenth. If that works better for your company, another option is to pay every week.

Collect Information & Forms

You have to collect your workers' full names, Social Security numbers, and tax forms (IT-4 for Ohio state taxes and W-4 for federal taxes); this information is best gathered during the onboarding process.

Get Timesheets

Correct timesheets are needed to make proper payouts. Keeping track of your workers' hours can be easier with time clocks, paper timesheets, or special tools for tracking time and attendance. Utilize a tool that can record overtime hours to ensure that rules about working extra hours are followed.

Calculate Payroll & Pay

Once you have timesheets and details about your workers, you need to do some math. You can see in your records how much each worker worked, how much they owed, and what changes were made. You also need to check the numbers you're using to figure out your Social Security, federal, and state taxes again. Also, following a thorough check of all details, you may choose any way to pay your employees.

File State Payroll Taxes

Ohio Business Gateway (OBG) helps you submit and pay state withholding taxes on time. You have two options for paying your taxes: you can use the Ohio Treasurer of State to send salaries directly or use the OBG to pay payrolls online. Moreover, the number of times you have to file is based on how much income and district taxes were taken out over a year, finishing on June 30.

Record Store Payroll Records

Every time someone gets paid, they should carefully keep track of their timesheets, tax forms, and pay stubs. According to Ohio law, you need to keep these papers for at least three years, so make sure they are safe and in order.

Annual Payroll Tax Reports

Other payroll specialist job duties include providing the federal government with the necessary W-2 and 1099 forms for freelancers and employees, respectively. The IT3 Transmittal of Wage and Tax Statements must also be sent. Moreover, tax settlement forms, like IT 942, must be sent through the Ohio Business Gateway (OBG).