As Introduced

136th General Assembly

Regular Session S. B. No. 250

2025-2026

To amend sections 5725.38, 5725.98, 5726.61, 5726.98, 5729.21, 5729.98, 5747.86, and 5747.98 and to enact section 122.841 of the Revised Code to authorize a nonrefundable, transferable tax credit for charitable organizations that construct owner-occupied housing and to name this act the Promised Land Act.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 5725.38, 5725.98, 5726.61, 5726.98, 5729.21, 5729.98, 5747.86, and 5747.98 be amended and section 122.841 of the Revised Code be enacted to read as follows:

Sec. 122.841. (A) As used in this section:

(1) "Eligible nonprofit organization" means an entity organized and operated exclusively for charitable purposes and recognized as exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code, which may be a church as defined by section 1710.01 of the Revised Code.

(2) "Development period" means the six-month period from the first day of January to the thirtieth day of June, or from the first day of July to the thirty-first day of December.

(3) "Business day" has the same meaning as in section 122.84 of the Revised Code.

(B) An eligible nonprofit organization that owns, in fee simple, real property in this state, and that facilitates the construction of housing on at least one acre of that property may apply to the director of development for a nonrefundable credit against the tax levied under section 5725.18, 5726.02, 5729.03, or 5747.02 of the Revised Code after one or more units of the housing are sold to an owner-occupant for use as the owner-occupant's primary residence. Sales of housing to an owner-occupant need not include transfer of fee simple ownership of the underlying land to qualify for a credit authorized by this section, but must include transfer of ownership of the housing unit and at least a leasehold interest in the underlying land.

The application shall be made on forms prescribed by the director. The director shall accept and review applications submitted under this section during two annual periods, the first of which begins on the tenth day of January and ends after the first day of February, and the second of which begins on the tenth day of July and ends after the first day of August. If any of those dates fall on a day that is not a business day, then the application period begins on or ends after the next business day, as applicable. The credit shall equal ten per cent of the total cost to construct the housing, including the cost or value of real property on which the housing is built.

The eligible nonprofit organization shall include the following information with its application:

(1) The number of housing units the organization facilitated construction of that were sold to owner-occupants for use as a primary residence during the immediately preceding development period;

(2) The aggregate acreage of all parcels on which the housing units were constructed;

(3) The amount spent to construct each unit. If the costs include land acquisition costs from the purchase of land on which multiple units were constructed, the organization shall apportion the land costs or value to each unit in proportion to the unit's share of the total amount of livable square footage.

(4) Any other information the director may require.

The director shall review and process applications in the order in which they are received.

(C) An eligible nonprofit organization shall be deemed to have facilitated the construction of housing if it enters into an agreement with another person under which the eligible nonprofit organization provides real property through contribution, lease, or similar arrangement, and the other person finances and constructs housing on the real property.

(D) An agreement described in division (C) of this section, an agreement to transfer ownership of housing to an owner-occupant, and documents of title transferring such ownership may include any terms that are not contrary to the terms of this section without affecting eligibility for the tax credit authorized by this section. Such terms may include provisions to preserve affordability and owner-occupancy.

(E)(1) Subject to division (E)(2) of this section, if the director determines that the applicant qualifies for a credit under this section, the director shall issue, within sixty days after the last day on which an application may be submitted for that application period, a tax credit certificate to the applicant identified with a unique number and listing the amount of credit the director determines is eligible to be claimed or transferred.

(2) The total amount of tax credits issued by the director shall not exceed twenty-five million dollars for any fiscal year.

The director shall not issue certificates to a single applicant in any fiscal biennium in a credit amount that exceeds two million dollars.

(3) The credit may be claimed by a person under section 5725.38, 5726.61, 5729.21, or 5747.86 of the Revised Code, as applicable. An eligible nonprofit organization that is not subject to taxation under section 5725.18, 5726.02, 5729.03, or 5747.02 of the Revised Code shall not claim the credit but may transfer the right to claim the credit under division (G) of this section.

(4) The eligible nonprofit organization shall be the sole applicant of any tax credit awarded under this section, regardless of whether another person finances or constructs the housing improvements.

(5) In awarding tax credit certificates, the director of development may grant preference to applications that incorporate ground lease arrangements, deed restrictions, or other mechanisms designed to preserve affordability and owner-occupancy.

(F) A taxpayer claiming a credit through a certificate issued under this section shall submit a copy of the certificate with the taxpayer's return or report.

(G) A person that holds a wholly or partially unclaimed certificate issued under this section may transfer the right to claim all or part of the remaining credit to any other person. To effectuate the transfer, the transferor shall notify the tax commissioner, in writing, that the transferor is transferring the right to claim all or part of the remaining credit stated on the certificate. The transferor shall identify in that notification the certificate's number, the name and the tax identification number of the transferee, the amount of remaining credit transferred to the transferee, and, if applicable, the amount of remaining credit retained by the transferor. The transferee may claim the amount of credit received under this division pursuant to and in the manner required under divisions (E)(3) and (F) of this section. Transferring a credit under this division does not extend the taxable year or calendar year for which the credit may be claimed or number of years for which the unclaimed credit amount may be carried forward under section 5725.38, 5726.61, 5729.21, or 5747.86 of the Revised Code, as applicable.

Any person to which a credit has been transferred under this division may transfer the right to claim all or part of the transferred credit amount to any other person, in the same manner prescribed by this division for the initial transfer, including that any such transfer be reported by the transferor to the tax commissioner as described in this division.

(H) On or before the first day of August each year, the director of development shall submit a report to the governor, the president and minority leader of the senate, and the speaker and minority leader of the house of representatives on the tax credit program authorized under this section. The report shall include the number of owner-occupied housing units for which a tax credit application was submitted under this section during the preceding year, the address of each unit, and the number of owner-occupied housing units for which certificates were issued during the preceding year.

(I) The tax credit authorized by this section shall be known as "the promised land credit."

Sec. 5725.38. ~~Terms used in this section have the same meanings as in section 122.84 of the Revised Code.~~

There is allowed a nonrefundable credit against the tax imposed by section 5725.18 of the Revised Code for a domestic insurance company that is issued, or to which is transferred, a tax credit certificate under section 122.84 or 122.841 of the Revised Code. The credit equals the amount stated on the certificate and may be claimed for the calendar year that includes the investment period or development period that was the subject of the application for the certificate under ~~that~~ the applicable section or for the ensuing calendar year. For a credit issued under section 122.84 of the Revised Code during the July application round each year, the credit may also be claimed for the preceding calendar year. A taxpayer applying a that credit for the preceding calendar year shall file an amended return or apply that amendment on the taxpayer's original return, for that year.

~~The~~ A credit authorized in this section shall be claimed in the order required under section 5725.98 of the Revised Code. If the amount of a credit exceeds the tax otherwise due under section 5725.18 of the Revised Code after deducting all other credits preceding the credit in that order, the excess may be carried forward for not more than five ensuing calendar years. The amount of the excess credit claimed in any such year shall be deducted from the balance carried forward to the next calendar year.

No credit shall be claimed under this section to the extent the credit was claimed under section 5726.61, 5729.21, or 5747.86 of the Revised Code.

Sec. 5725.98. (A) To provide a uniform procedure for calculating the amount of tax imposed by section 5725.18 of the Revised Code that is due under this chapter, a taxpayer shall claim any credits and offsets against tax liability to which it is entitled in the following order:

The credit for an insurance company or insurance company group under section 5729.031 of the Revised Code;

The credit for eligible employee training costs under section 5725.31 of the Revised Code;

The credit for purchasers of qualified low-income community investments under section 5725.33 of the Revised Code;

The nonrefundable job retention credit under division (B) of section 122.171 of the Revised Code;

The nonrefundable credit for investments in rural business growth funds under section 122.152 of the Revised Code;

The nonrefundable Ohio low-income housing tax credit under section 5725.36 of the Revised Code;

The nonrefundable affordable single-family home credit under section 5725.37 of the Revised Code;

The nonrefundable credit for contributing capital to a transformational mixed use development project under section 5725.35 of the Revised Code;

The nonrefundable opportunity zone investment credit under section 5725.38 of the Revised Code;

The nonrefundable promised land credit under section 5725.38 of the Revised Code;

The offset of assessments by the Ohio life and health insurance guaranty association permitted by section 3956.20 of the Revised Code;

The refundable credit for rehabilitating a historic building under section 5725.34 of the Revised Code;

The refundable credit for Ohio job retention under former division (B)(2) or (3) of section 122.171 of the Revised Code as those divisions existed before September 29, 2015, the effective date of the amendment of this section by H.B. 64 of the 131st general assembly;

The refundable credit for Ohio job creation under section 5725.32 of the Revised Code;

The refundable credit under section 5725.19 of the Revised Code for losses on loans made under the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code.

(B) For any credit except the refundable credits enumerated in this section, the amount of the credit for a taxable year shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating that credit. Nothing in this chapter shall be construed to allow a taxpayer to claim, directly or indirectly, a credit more than once for a taxable year.

Sec. 5726.61. ~~Terms used in this section have the same meanings as in section 122.84 of the Revised Code.~~

A taxpayer may claim a nonrefundable credit against the tax imposed under section 5726.02 of the Revised Code for each person included in the annual report of the taxpayer to whom a certificate is issued or transferred under section 122.84 or 122.841 of the Revised Code ~~or is transferred pursuant to that section~~. The credit equals the amount stated on the certificate and may be claimed for the taxable year that aligns with the calendar year that includes the investment period or development period that was the subject of the application for the certificate under ~~that~~ the applicable section or for the ensuing calendar year. For a credit issued under section 122.84 of the Revised Code during the July application round each year, the credit may also be claimed for the preceding taxable year. A taxpayer applying a that credit for the preceding taxable year shall file an amended report or apply that amendment on the taxpayer's original report, for that year.

~~The~~ A credit authorized in this section shall be claimed in the order required under section 5726.98 of the Revised Code. If the amount of a credit exceeds the tax otherwise due under section 5726.02 of the Revised Code after deducting all other credits preceding the credit in that order, the excess may be carried forward for not more than five ensuing taxable years. The amount of the excess credit claimed in any such year shall be deducted from the balance carried forward to the next taxable year.

No credit shall be claimed under this section to the extent the credit was claimed under section 5725.38, 5729.21, or 5747.86 of the Revised Code.

Sec. 5726.98. (A) To provide a uniform procedure for calculating the amount of tax due under section 5726.02 of the Revised Code, a taxpayer shall claim any credits to which the taxpayer is entitled under this chapter in the following order:

The nonrefundable job retention credit under division (B) of section 5726.50 of the Revised Code;

The nonrefundable credit for purchases of qualified low-income community investments under section 5726.54 of the Revised Code;

The nonrefundable credit for transformational mixed use development tax credit certificate holders under section 5726.62 of the Revised Code;

The nonrefundable credit for qualified research expenses under section 5726.56 of the Revised Code;

The nonrefundable credit for qualifying dealer in intangibles taxes under section 5726.57 of the Revised Code;

The nonrefundable Ohio low-income housing tax credit under section 5726.58 of the Revised Code;

The nonrefundable affordable single-family home credit under section 5726.60 of the Revised Code;

The nonrefundable welcome home Ohio (WHO) program credit under section 122.633 of the Revised Code;

The nonrefundable opportunity zone investment credit under section 5726.61 of the Revised Code;

The nonrefundable promised land credit under section 5726.61 of the Revised Code;

The refundable credit for rehabilitating an historic building under section 5726.52 of the Revised Code;

The refundable job retention or job creation credit under division (A) of section 5726.50 of the Revised Code;

The refundable credit under section 5726.53 of the Revised Code for losses on loans made under the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code;

The refundable motion picture and broadway theatrical production credit under section 5726.55 of the Revised Code.

Sec. 5729.21. ~~Terms used in this section have the same meanings as in section 122.84 of the Revised Code.~~

There is allowed a nonrefundable credit against the tax imposed by section 5729.03 of the Revised Code for a foreign insurance company that is issued, or to which is transferred, a tax credit certificate under section 122.84 or 122.841 of the Revised Code. The credit equals the amount stated on the certificate and may be claimed for the calendar year that includes the investment period or development period that was the subject of the application for the certificate under ~~that~~ the applicable section or for the ensuing calendar year. For a credit issued under section 122.84 of the Revised Code during the July application round each year, the credit may also be claimed for the preceding calendar year. A taxpayer applying a that credit for the preceding calendar year shall file an amended return or apply that amendment on the taxpayer's original return, for that year.

~~The~~ A credit authorized in this section shall be claimed in the order required under section 5729.98 of the Revised Code. If the amount of a credit exceeds the tax otherwise due under section 5729.03 of the Revised Code after deducting all other credits preceding the credit in that order, the excess may be carried forward for not more than five ensuing calendar years. The amount of the excess credit claimed in any such year shall be deducted from the balance carried forward to the next calendar year.

No credit shall be claimed under this section to the extent the credit was claimed under section 5725.38, 5726.61, or 5747.86 of the Revised Code.

A foreign insurance company shall not be required to pay any additional tax levied under section 5729.06 of the Revised Code as a result of claiming ~~the~~ a tax credit authorized by this section.

Sec. 5729.98. (A) To provide a uniform procedure for calculating the amount of tax due under this chapter, a taxpayer shall claim any credits and offsets against tax liability to which it is entitled in the following order:

The credit for an insurance company or insurance company group under section 5729.031 of the Revised Code;

The credit for eligible employee training costs under section 5729.07 of the Revised Code;

The credit for purchases of qualified low-income community investments under section 5729.16 of the Revised Code;

The nonrefundable job retention credit under division (B) of section 122.171 of the Revised Code;

The nonrefundable credit for investments in rural business growth funds under section 122.152 of the Revised Code;

The nonrefundable Ohio low-income housing tax credit under section 5729.19 of the Revised Code;

The nonrefundable affordable single-family home credit under section 5729.20 of the Revised Code;

The nonrefundable credit for contributing capital to a transformational mixed use development project under section 5729.18 of the Revised Code;

The nonrefundable opportunity zone investment credit under section 5729.21 of the Revised Code;

The nonrefundable promised land credit under section 5729.21 of the Revised Code;

The offset of assessments by the Ohio life and health insurance guaranty association against tax liability permitted by section 3956.20 of the Revised Code;

The refundable credit for rehabilitating a historic building under section 5729.17 of the Revised Code;

The refundable credit for Ohio job creation under section 5729.032 of the Revised Code;

The refundable credit under section 5729.08 of the Revised Code for losses on loans made under the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code.

Sec. 5747.86. ~~Terms used in this section have the same meanings as in section 122.84 of the Revised Code.~~

There is hereby allowed a nonrefundable credit against a taxpayer's aggregate tax liability under section 5747.02 of the Revised Code for a taxpayer who is issued, or to whom is transferred, a tax credit certificate under section 122.84 or 122.841 of the Revised Code. The credit equals the amount stated on the certificate and may be claimed for the taxable year that includes the first day of the investment period or development period that was the subject of the application for the certificate under ~~that~~ the applicable section or for the ensuing taxable year. For a credit issued under section 122.84 of the Revised Code during the July application round each year, the credit may also be claimed for the preceding taxable year. A taxpayer applying a that credit for the preceding taxable year shall file an amended return or apply that amendment on the taxpayer's original return, for that year.

If the certificate is held by a pass-through entity, any taxpayer that is a direct or indirect investor in the pass-through entity on the last day of the entity's qualifying taxable year may claim the taxpayer's proportionate or distributive share of the credit against the taxpayer's aggregate amount of tax levied under section 5747.02 of the Revised Code.

The credit shall be claimed in the order required under section 5747.98 of the Revised Code. If the credit exceeds the taxpayer's aggregate tax due under section 5747.02 of the Revised Code for that taxable year after allowing for credits that precede the credit under this section in that order, such excess shall be allowed as a credit in each of the ensuing five taxable years, but the amount of any excess credit allowed in any such taxable year shall be deducted from the balance carried forward to the ensuing taxable year.

No credit shall be claimed under this section to the extent the credit was claimed under section 5725.38, 5726.61, or 5729.21 of the Revised Code.

Sec. 5747.98. (A) To provide a uniform procedure for calculating a taxpayer's aggregate tax liability under section 5747.02 of the Revised Code, a taxpayer shall claim any credits to which the taxpayer is entitled in the following order:

Either the retirement income credit under division (B) of section 5747.055 of the Revised Code or the lump sum retirement income credits under divisions (C), (D), and (E) of that section;

Either the senior citizen credit under division (F) of section 5747.055 of the Revised Code or the lump sum distribution credit under division (G) of that section;

The dependent care credit under section 5747.054 of the Revised Code;

The credit for displaced workers who pay for job training under section 5747.27 of the Revised Code;

The twenty-dollar personal exemption credit under section 5747.022 of the Revised Code;

The joint filing credit under division (E) of section 5747.05 of the Revised Code;

The earned income credit under section 5747.71 of the Revised Code;

The nonrefundable credit for education expenses under section 5747.72 of the Revised Code;

The nonrefundable credit for donations to scholarship granting organizations under section 5747.73 of the Revised Code;

The nonrefundable credit for tuition paid to a nonchartered nonpublic school under section 5747.75 of the Revised Code;

The nonrefundable vocational job credit under section 5747.057 of the Revised Code;

The nonrefundable job retention credit under division (B) of section 5747.058 of the Revised Code;

The enterprise zone credit under section 5709.66 of the Revised Code;

The credit for beginning farmers who participate in a financial management program under division (B) of section 5747.77 of the Revised Code;

The credit for commercial vehicle operator training expenses under section 5747.82 of the Revised Code;

The nonrefundable welcome home Ohio (WHO) program credit under section 122.633 of the Revised Code;

The nonrefundable credit for transformational mixed use development tax credit certificate holders under section 5747.87 of the Revised Code;

The credit for selling or renting agricultural assets to beginning farmers under division (A) of section 5747.77 of the Revised Code;

The credit for purchases of qualifying grape production property under section 5747.28 of the Revised Code;

The small business investment credit under section 5747.81 of the Revised Code;

The nonrefundable lead abatement credit under section 5747.26 of the Revised Code;

The opportunity zone investment credit under section 5747.86 of the Revised Code;

The nonrefundable promised land credit under section 5747.86 of the Revised Code;

The enterprise zone credits under section 5709.65 of the Revised Code;

The research and development credit under section 5747.331 of the Revised Code;

The credit for rehabilitating a historic building under section 5747.76 of the Revised Code;

The nonrefundable Ohio low-income housing tax credit under section 5747.83 of the Revised Code;

The nonrefundable affordable single-family home credit under section 5747.84 of the Revised Code;

The nonresident credit under division (A) of section 5747.05 of the Revised Code;

The credit for a resident's out-of-state income under division (B) of section 5747.05 of the Revised Code;

The refundable motion picture and broadway theatrical production credit under section 5747.66 of the Revised Code;

The refundable jobs creation credit or job retention credit under division (A) of section 5747.058 of the Revised Code;

The refundable credit for taxes paid by a qualifying entity granted under section 5747.059 of the Revised Code;

The refundable credits for taxes paid by a qualifying pass-through entity granted under division (I) of section 5747.08 of the Revised Code;

The refundable credit under section 5747.80 of the Revised Code for losses on loans made to the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code;

The refundable credit for rehabilitating a historic building under section 5747.76 of the Revised Code;

The refundable credit under section 5747.39 of the Revised Code for taxes levied under section 5747.38 of the Revised Code paid by an electing pass-through entity.

(B) For any credit, except the refundable credits enumerated in this section and the credit granted under division (H) of section 5747.08 of the Revised Code, the amount of the credit for a taxable year shall not exceed the taxpayer's aggregate amount of tax due under section 5747.02 of the Revised Code, after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating that credit. Nothing in this chapter shall be construed to allow a taxpayer to claim, directly or indirectly, a credit more than once for a taxable year.

Section 2. That existing sections 5725.38, 5725.98, 5726.61, 5726.98, 5729.21, 5729.98, 5747.86, and 5747.98 of the Revised Code are hereby repealed.

Section 3. This act shall be known as the Promised Land Act.