Cleveland local tax guide
Who pays Cleveland's local tax
Your work address decides withholding. A Lakewood, Parma, or Shaker Heights resident with a downtown or University Circle job has 2.5% withheld for Cleveland. Cleveland residents owe the city 2.5% on all wages, but CCA credits tax paid to the work city in full up to 2.5%. A resident working in Parma, which also charges 2.5%, owes Cleveland nothing extra. A resident working in a lower-rate suburb owes Cleveland the difference, and a resident working in a township or out of state owes the whole 2.5%.
How Cleveland's income tax works
Cleveland, Ohio's second-largest city with about 384,000 residents, levies a flat 2.5% on wages, commissions, and business net profit. The tax is administered by CCA, which publishes the city's forms and processes returns, estimated payments, and refunds.
CCA's individual return includes Schedule R, a grid that shows the residence-city rate left over after credit for each work-city rate. For Cleveland the leftover drops to zero once the work city charges 2.5% or more, which is how the full credit up to 2.5% shows up in practice.
The city taxes Medicare wages, so traditional 401(k) deferrals do not reduce it. Cuyahoga County has no county income tax, so the city tax and any school district tax are the only local layers.
Worked example: $75,000 in Cleveland
A single filer earning $75,000 pays $7,670 in federal income tax, $1,288 in Ohio tax, $4,650 for Social Security, and $1,088 for Medicare. Cleveland adds $1,875. Net pay lands at $58,429 for the year, close to $4,869 each month.
In a place with no municipal tax the same paycheck would net $60,304, so Cleveland costs $1,875 a year at this salary. The cost is identical for residents and commuters, because Cleveland applies one rate to both.
The residence credit changes the math for Clevelanders who work in suburbs. A resident with a $75,000 job in a 2% suburb has $1,500 withheld there and owes Cleveland the remaining $375. With a job in Lakewood, which charges 1.5%, Lakewood takes $1,125 and Cleveland collects $750.
Filing with CCA
Employers send Cleveland withholding to CCA, and residents who owe a balance file the CCA individual return by the April deadline. If your employer withholds only for a suburb, use Schedule R to find what you still owe Cleveland, or ask payroll to withhold the Cleveland difference as a courtesy.
Nonresidents who work from home part of the week can ask CCA for a refund of Cleveland tax withheld for days worked outside the city, supported by a log of work locations and, typically, a statement from the employer.
How Cleveland compares with other Ohio cities
Cleveland's 2.5% matches Columbus, Toledo, Akron, Dayton, and four smaller cities on this site, and only Youngstown's 2.75% is higher, at $2,063 on a $75,000 salary. Cincinnati's 1.8% costs $1,350, which is $525 less than Cleveland.
Inside Cuyahoga County the contrast is sharp. Parma matches Cleveland at 2.5%, while Lakewood's 1.5% costs $1,125, which is $750 less than Cleveland at $75,000. Those suburban rates matter mainly for where you live, because a Cleveland job is taxed at 2.5% regardless of your address.
Tips for Cleveland paychecks
Use Schedule R before you file
If you live in Cleveland and work in a suburb, CCA's Schedule R shows the Cleveland rate still owed for your work city's rate.
Ask for courtesy withholding
Clevelanders working in lower-rate suburbs or outside Ohio can ask payroll to withhold the Cleveland balance so it is not due all at once.
Track hybrid days
If you live outside Cleveland and work from home part of the week, keep a log of home days to support a refund request to CCA.
Do not expect a 401(k) break
Cleveland taxes Medicare wages, so retirement deferrals still carry the 2.5% city tax.