Updated October 7, 2026. Quick answer: Only if you live there. Ohio’s instructions say residents are taxed on their income, and nonresidents may claim a credit for “all items of income not earned and not received in Ohio.”
How Ohio treats a pension earned elsewhere
| Item | What the state documents say |
|---|---|
| Nonresidents | Ohio requires a nonresident to file only when the nonresident has Ohio-sourced income, and the examples listed are wages earned in Ohio, lottery and gaming winnings, Ohio property, and Ohio business income. A nonresident may claim the nonresident credit for income not earned and not received in Ohio. This rests on the 2025 IT 1040 instructions and R.C. 5747.05(A). |
| Residents with a pension earned elsewhere | The IT 1040 instructions state that every Ohio resident is subject to Ohio income tax, so a pension earned in another state is taxed through Ohio adjusted gross income. Ohio offers a retirement income credit with a maximum of $200 per return, for taxpayers whose modified adjusted gross income less exemptions is under $100,000 and whose retirement income is included in Ohio adjusted gross income, and a resident credit may apply to tax paid to another state. The source says: “The maximum credit per return is $200.” This rests on the resident sections of the 2025 IT 1040 instructions. |
| Part-year residents (year of a move) | A part-year resident is someone who permanently moved into or out of Ohio during the year, and is entitled to the nonresident credit for income earned while a resident of another state. On form IT NRC, pensions, annuities and IRA distributions are entered in Column B when paid or accrued while an Ohio resident. The source says: “paid or accrued while you were an Ohio resident”. This rests on the part-year and IT NRC sections of the 2025 IT 1040 instructions. |
| Rate | Ohio prints a graduated schedule for 2025 with 0.000% on the first $26,050 of taxable nonbusiness income, 2.750% above that, and 3.125% on the amount over $100,000. The source says: “the highest tax rate has been reduced to 3.125%.” Ohio taxes business income not deducted at a flat 3%. |
| Return to file | Residents, part-year residents and nonresidents all use the Ohio IT 1040. Part-year residents and nonresidents calculate the nonresident credit on form IT NRC. The booklet states that form IT NRS is no longer used beginning with tax year 2025. |
A $40,000 move-year example
A retiree receives $40,000 of pension in the year of a move: $20,000 before the move date, as an Ohio resident, and $20,000 after leaving.
The first $20,000 can be taxed by Ohio; the rest is outside its reach under the federal rule below. Taxed wholly at the lowest printed rate, 0.000%, the tax on it is computed as $20,000 x 0 = $0; taxed wholly at the highest, 3.125%, it is computed as $20,000 x 0.03125 = $625. The real figure falls between these bounds before any exclusion or credit. Federal tax still applies.
What changes in 2026
Ohio Revised Code section 5747.02 sets a single rate of 2.75% above $26,050 for taxable years beginning in 2026 and thereafter.
The federal rule that protects a nonresident
4 U.S.C. 114(a) bars a state income tax on retirement income of an individual “who is not a resident or domiciliary of such State”. Retirement income means certain plan payments made as a “series of substantially equal periodic payments”, so not every payment is covered.
Related: how Ohio taxes retirement income, whether Ohio taxes pensions, Ohio to Arizona retirement taxes, Ohio to Florida retirement taxes, out-of-state pension tax by state, and deferred compensation lump sums after a move.
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Answer againSources
- 2025 Ohio IT 1040 / SD 100 Instructions (Ohio Department of Taxation): https://dam.assets.ohio.gov/image/upload/v1767095693/tax.ohio.gov/forms/ohio_individual/individual/2025/it1040-booklet.pdf
- Ohio Revised Code 5747.02 Levy of tax (Ohio Laws): https://codes.ohio.gov/ohio-revised-code/section-5747.02
- Ohio Revised Code 5747.05 Credits (Ohio Laws): https://codes.ohio.gov/ohio-revised-code/section-5747.05
- 4 U.S.C. 114, Limitation on State income taxation of certain pension income (U.S. Government Publishing Office, 2023 edition): https://www.govinfo.gov/content/pkg/USCODE-2023-title4/html/USCODE-2023-title4-chap4-sec114.htm
Sources: the primary documents linked above, read on October 7, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.