All employers with one or more employees must carry workers' compensation coverage. Section 4123 of the Ohio Revised Code specifically excludes certain business owners and ministers, and Ohio law makes coverage optional or elective for those excluded categories of individuals. The categories of employers or individuals that may elect coverage are:
- Sole proprietor.
- Limited liability company (LLC) acting as and filing a federal income tax return as a sole proprietor.
- Limited liability company (LLC) acting as and filing a federal income tax return as a partnership.
- Family farm corporate officers.
- Individual incorporated as a corporation with no employees (ICORP).
- Ordained or associate ministers of a religious organization.
To elect coverage, you must complete an Application for Elective Coverage (U-3S). For individuals electing coverage, you will be assigned the class code representing the highest rated classification of any of the duties you perform.
For more information on qualifications for elective coverage, see the elective coverage page.
Minimum and maximum reportable earnings
Each sole proprietor, partner, family farm corporation or I-CORP officer electing coverage must report a minimum amount, even if the amount earned is lower than this minimum amount.
- Earnings are reportable up to the current policy year's maximum amount. (See below.)
- Individuals who earn between the minimum and maximum should report the actual income as described above.
- Minimum and maximum amounts will change each policy year.
- When coverage is effective or cancelled during a policy year, the reportable amount is based on the days of active coverage.
The business year end that falls within the policy year is the tax return that is to be used for policy year reporting. For example, a business with a Dec. 31, 2017 year end would use the tax information from the 2017 return to report elective coverage for the policy year 2017 true-up. If a tax return is not yet completed, estimate the net income based on financial statements.
Reportable earnings for a sole proprietor who has elected coverage are calculated based on the Net Profit from the Federal 1040 Schedule C. Losses are not deductible.
Reportable earnings for an individual partner who has elected coverage are calculated based on the portion of Ordinary Income reported on the Federal form 1065 schedule K-1, plus any Guaranteed Payments to Partners, less Section 179 depreciation. Losses are not deductible.
||Minimum reportable wages per person per week
||Maximum reportable wages per person per week
|July 1, 2020 - June 30, 2021
|July 1, 2019 - June 30, 2020
|July 1, 2018 - June 30, 2019
|July 1, 2017 - June 30, 2018
|July 1, 2016 - June 30, 2017
|Jan. 1, 2015 - June 30, 2016
Reporting for ministers
A church must cover all employees through the standard policy of payroll reporting; however, ordained and/or licensed ministers are considered self-employed individuals not employees of the church. Therefore, if they are on the church's formal payroll, their wages and allowances should not be reported.
However, the church may voluntarily elect to cover the minister(s) by completing and submitting the U-3S to BWC. The form must also be submitted when adding or discontinuing coverage for ministers. Gross remuneration includes the minister's gross pay, parsonage and living allowance such as utilities and fuel, and other qualifying expenses. There is no minimum or maximum reportable for this coverage.
If a church decides not to cover its ministers, the ministers may elect to establish their own coverage as a sole proprietor using the Application for Ohio Workers' Compensation Coverage (U-3). Payroll reporting guidelines are the same as for sole proprietors.
If an ordained and/or licensed minister is also a corporate officer of a church, the minimum/maximum reporting requirements apply if the officer/minister does not perform pastoral duties. If the officer/minister performs pastoral duties, the reporting requirements for a minister are followed and there is no minimum or maximum limits on reporting the payroll.