Ohio Schedule of Adjustments — Additions and Deductions

Get the blank Schedule of Adjustments (PDF)  ·  Checked line by line against the official Ohio form, last verified September 9, 2026  ·  How we verify

What is Schedule of Adjustments?

The Ohio Schedule of Adjustments (Sequence No. 3) sits between your federal return and the Ohio IT 1040. Ohio starts its tax calculation from federal adjusted gross income, but Ohio taxes some things the federal government does not, and exempts some things the federal government taxes. This schedule captures both: additions on Lines 1 through 11, deductions on Lines 13 through 46. The two totals flow to Ohio IT 1040, Lines 2a and 2b, and produce your Ohio adjusted gross income on Line 3.

Most of the lines are narrow situations. The ones that matter for a typical return are the deductions: Social Security benefits, most military and uniformed-services pay and retirement income, 529 college savings contributions, unreimbursed medical expenses, and — for anyone with self-employment or pass-through income — the business income deduction. Completing the schedule correctly matters because a missed deduction leaves income on the return that Ohio never intended to tax.

Who Must File the Ohio Schedule of Adjustments?

Complete the Schedule of Adjustments if you have any addition or deduction on it. In practice that includes anyone who: – received Social Security or railroad retirement benefits that were taxable federally; – received military pay while stationed outside Ohio, or uniformed-services retirement income; – contributed to an Ohio 529 (CollegeAdvantage) plan or a STABLE account; – had unreimbursed medical and health care expenses above the threshold in the worksheet; – has business or pass-through income eligible for the business income deduction; or – earned interest on non-Ohio state or local bonds, took bonus depreciation, or has one of the other listed items.

You do not attach it if none of its lines apply — then Ohio IT 1040 Lines 2a and 2b are simply zero.

How to File the Ohio Schedule of Adjustments

• Electronically: OH|TAX eServices and approved software include the schedule and carry the totals to the IT 1040 automatically.
• By mail: Complete only the lines that apply, enter the Line 12 and Line 47 totals on Ohio IT 1040, Lines 2a and 2b, and include the schedule with your return. Attach the medical-expense and medical-savings-account worksheets if you use Lines 44 or 45, and the Ohio Schedule of Business Income if you use Line 13.

Before you start, finish your federal return and your Ohio Schedule of Business Income (if you have business income), and gather your SSA-1099, any military or retirement statements, your 529 and STABLE contribution records, and your medical expense records.

When Is the Ohio Schedule of Adjustments Due?

The schedule has no separate deadline. File it with your Ohio IT 1040 by that return’s due date — April 15, 2026 for the 2025 tax year. An IRS extension extends the Ohio filing deadline as well, but not the time to pay.

Where to Send the Ohio Schedule of Adjustments

Send it with your Ohio IT 1040 — it is not filed separately. The IT 1040 goes to the Ohio Department of Taxation, Columbus: P.O. Box 2679 (43270-2679) without a payment, or P.O. Box 2057 (43270-2057) with a payment. Always include the OUPC with a mailed check.

How to Complete the Ohio Schedule of Adjustments Line by Line

Additions (Lines 1–12)

Line 1 — Non-Ohio state or local government interest and dividends. Interest and dividends from another state’s or locality’s bonds, to the extent they were not already in federal AGI. Do not include interest on Ohio obligations or on U.S. or U.S. territory obligations.

Line 2 — Ohio pass-through entity tax add-back. Ohio PTE tax paid on the IT 1140 or IT 4738, to the extent it was not in your federal AGI.

Line 3 — Taxes paid to another state or D.C. related to IRS Notice 2020-75. The state PTE-style tax add-back described in that notice.

Line 4 — 529 plan funds used for non-qualified expenses. Distributions from a 529 savings plan that were not used for qualified expenses, to the extent a deduction was taken in a prior year.

Line 5 — Losses from the sale or disposition of Ohio public obligations. Add back losses on Ohio public obligations, which Ohio does not allow.

Line 6 — Nonmedical withdrawals from a medical savings account. Amounts withdrawn from an Ohio medical savings account for non-medical purposes.

Line 7 — Reimbursement of expenses previously deducted on an Ohio return. If you deducted an expense on a prior Ohio return and were later reimbursed, add the reimbursement back.

Line 8 — Ineligible withdrawals from an Ohio Homebuyer Plus account. Withdrawals not used for an eligible home purchase.

Line 9 — IRC 168(k) and 179 depreciation add-back. The portion of federal bonus depreciation and Section 179 expense Ohio requires you to add back now and deduct over later years (see Line 27).

Line 10 — Exempt federal interest and dividends subject to state taxation. Federally exempt interest and dividends that Ohio does tax.

Line 11 — Federal conformity additions. Additions arising from differences between Ohio law and recent federal changes, per the instructions.

Line 12 — Total additions. Add Lines 1 through 11 only. Enter here and on Ohio IT 1040, Line 2a.

Deductions (Lines 13–47)

Line 13 — Business income deduction. Enter the amount from the Ohio Schedule of Business Income, Line 13. That schedule totals your business income (from federal Schedules B, C, D, E, and F, plus guaranteed payments to a 20%-or-greater owner and certain add-backs), then deducts the first $250,000 of it ($125,000 if married filing separately). Business income above the deduction is taxed at a flat 3% on the IT 1040.

Line 14 — Employee compensation earned in Ohio by residents of neighboring states. Reciprocity: wages earned in Ohio by a full-year resident of Indiana, Kentucky, Michigan, Pennsylvania, or West Virginia are not taxed by Ohio.

Line 15 — Taxable refunds, credits, or offsets of state and local income taxes. The state tax refund amount from federal Schedule 1, Line 1.

Line 16 — Taxable Social Security benefits. Enter the taxable Social Security benefits from federal Form 1040, Line 6b. Ohio does not tax Social Security, so this removes it.

Line 17 — Certain railroad benefits. Railroad Retirement benefits and railroad unemployment/sickness benefits that Ohio does not tax.

Line 18 — Interest and gains from Ohio public obligations. Interest income from Ohio public obligations and purchase obligations, gains on their disposition, or income from a transfer agreement.

Line 19 — Ohio county individual development account contributions. Amounts you contributed to a county IDA program.

Line 20 — STABLE account contributions (Ohio’s ABLE plan). Deductible up to $5,000 per account per year.

Line 21 — Disaster-response income. Income earned in Ohio by a qualifying out-of-state business or employee for disaster work during a declared disaster response period.

Line 22 — East Palestine train derailment payments. Certain payments related to the derailment.

Line 23 — Ohio adoption grant program payments. Grant payments received from the Ohio Department of Children and Youth.

Line 24 — Ohio Homebuyer Plus account. Amounts contributed to, and interest earned on, an Ohio Homebuyer Plus account.

Line 25 — Pregnancy resource center contributions. Contributions to a qualifying center.

Line 26 — Federal interest and dividends exempt from state taxation. U.S. government interest and other federally sourced interest and dividends Ohio may not tax.

Line 27 — Prior-year 168(k) and 179 depreciation deduction. The portion of a prior-year depreciation add-back (Line 9) you are allowed to deduct this year.

Line 28 — Prior-year federal itemized deduction refunds. Refunds or reimbursements from federal Schedule 1, Line 8z, for federal itemized deductions claimed on a prior-year return.

Line 29 — Repayment of income reported in a prior year. Income you reported and paid Ohio tax on in an earlier year and had to repay.

Line 30 — Wage expense not deducted due to the federal work opportunity tax credit. The wage expense the federal credit disallowed.

Line 31 — Federal conformity deductions. Deductions arising from Ohio–federal conformity differences, per the instructions.

#### Uniformed Services (Lines 32–36)

Line 32 — Military pay received by Ohio residents while stationed outside Ohio. Active-duty pay earned while stationed outside Ohio.

Line 33 — Compensation earned by nonresident military servicemembers and their civilian spouses. Military pay of a nonresident servicemember, and the qualifying civilian spouse’s Ohio wages.

Line 34 — Uniformed services retirement income. Deduct military and uniformed-services retirement income if both conditions in the instructions are met. “Uniformed services” includes the armed forces and their reserve components and the National Guard.

Line 35 — Military injury relief fund grants and veterans’ disability severance payments.

Line 36 — Certain Ohio National Guard reimbursements and benefits.

#### Education (Lines 37–41)

Line 37 — Contributions to a 529 plan. Deduct contributions to a 529 savings plan, up to $4,000 per beneficiary per year, with any amount over $4,000 carried forward and deducted in future years. Also deduct 529 plan income that is not otherwise excluded.

Line 38 — Pell / Ohio College Opportunity taxable grant amounts used for room and board.

Line 39 — Ohio educator expenses in excess of the federal deduction. Classroom expenses a teacher paid beyond what the federal educator-expense deduction allowed.

Line 40 — Rural practice incentive program loan repayments. Income attributable to loan repayments made by the Ohio Department of Higher Education under that program.

Line 41 — Grants for adopted students. Grant program payments made by the Ohio Department of Higher Education on behalf of adopted students.

#### Medical (Lines 42–46)

Line 42 — Disability benefits. Disability benefits that Ohio does not tax, including certain railroad disability benefits.

Line 43 — Survivor benefits. Survivor benefits a beneficiary receives; married taxpayers may deduct up to the limit in the instructions.

Line 44 — Unreimbursed medical and health care expenses. Use the worksheet in the instructions to figure the deductible amount (only expenses above a percentage-of-income threshold count), and include a copy of the worksheet.

Line 45 — Medical savings account contributions and earnings. Use the worksheet in the instructions and include a copy.

Line 46 — Qualified organ donor expenses. Unreimbursed expenses for a living organ donation.

Line 47 — Total deductions. Add Lines 13 through 46 only. Enter here and on Ohio IT 1040, Line 2b.

Common Mistakes to Avoid

• Not deducting Social Security. Ohio does not tax it — enter the federally taxable amount on Line 16.
• Missing the 529 deduction, or over-claiming it. The limit is $4,000 per beneficiary per year; more than that carries forward, it is not lost.
• Forgetting military retirement. Uniformed-services retirement income is deductible on Line 34 when the conditions are met.
• Skipping the medical-expense worksheet. Lines 44 and 45 require the worksheet, and you must attach a copy.
• Adding the wrong lines. Additions total is Lines 1–11 only (Line 12); deductions total is Lines 13–46 only (Line 47).
• Double-counting the business income deduction. It comes only from the Schedule of Business Income, Line 13 — do not also enter business income anywhere else on this schedule.
• Deducting Ohio-bond interest as an addition, or non-Ohio-bond interest as a deduction. Line 1 adds non-Ohio bond interest; Line 18 deducts Ohio public obligation income.

Frequently Asked Questions

Does Ohio tax Social Security? No. The federally taxable portion of your benefits is deducted on Line 16.

Does Ohio tax military retirement pay? Uniformed-services retirement income is deductible on Line 34 when the conditions in the instructions are met.

How much of my 529 contributions can I deduct? Up to $4,000 per beneficiary per year. Contributions over $4,000 carry forward to future years.

Do I have to file this schedule? Only if you have an addition or a deduction on it. If not, IT 1040 Lines 2a and 2b are zero.

What is the business income deduction? On the Schedule of Business Income you deduct the first $250,000 of business income ($125,000 if married filing separately); the remainder is taxed at a flat 3%. The deduction amount is carried to Line 13 here.

Where do the totals go? Line 12 (additions) to Ohio IT 1040, Line 2a; Line 47 (deductions) to Ohio IT 1040, Line 2b.

Can I deduct medical expenses? Yes, unreimbursed medical and health care expenses above the worksheet threshold, on Line 44 — attach the worksheet.

Final Review Before Filing

• Only the addition and deduction lines that apply to you are completed.
• Line 12 adds Lines 1–11 only and matches Ohio IT 1040, Line 2a.
• Line 47 adds Lines 13–46 only and matches Ohio IT 1040, Line 2b.
• Social Security (Line 16) and any uniformed-services pay or retirement (Lines 32–34) are deducted if they apply.
• 529 contributions on Line 37 do not exceed $4,000 per beneficiary; excess is carried forward.
• The medical-expense and medical-savings-account worksheets are attached if Lines 44 or 45 are used.
• The Ohio Schedule of Business Income is attached if Line 13 is used.
• The schedule is included with the IT 1040.

General information from the official form and its instructions, not advice for your circumstances. See the full disclaimer.