Ohio has expanded its job creation credit to employers of “home-based employees.” Sub. H.B. 327 (effective Sept. 6, 2012). A “home-based employee” is an employee who works primarily from the employee’s Ohio residence exclusively for the benefit of a qualifying project and is paid at least 131% of federal minimum wage. To qualify for the credit for telecommuting employees, the employer must employ 200 more employees than it employed on June 30, 2011. The Director of Development may require employers to make health care benefits and tuition reimbursement available for all employees to receive the credit.

Separate applications must be submitted if the employer seeks the credit for both telecommuters and employees working on-site. The credit can be taken against the employer’s Ohio commercial activity tax, franchise tax (for financial institutions) or insurance company premium tax.

The job creation credit based upon home-based employees is available for a six-year trial period, with the Director of Development to report to the Ohio Governor, Senate President and Speaker of the House regarding the effect thereof and nationwide trends for telecommuting employees after the trial period. See Final Analysis of Sub. H.B. 327.