Ohio Revised Code Title LVII. Taxation § 5747.79

(1) “Qualifying capital gain” means a capital gain from the sale of an interest in an entity reported for the taxable year to the internal revenue service pursuant to the Internal Revenue Code, to the extent that such capital gain is not otherwise deducted or excluded in computing federal or Ohio adjusted gross income for the taxable year, provided that all of the following apply:

(2) A “sale of an interest in an entity” includes the sale, exchange, or other disposition of stock, a membership interest, or any other equity or ownership interest, owned directly or indirectly by the taxpayer, in an entity that conducts a trade or business in this state.

(3) “Qualifying payroll” means the amount of compensation used to determine the withholding obligations in division (A) of section 5747.06 of the Revised Code and paid over one of the following periods by the entity whose sale generated the qualifying capital gain:

(4) “Deductible payroll” means the qualifying payroll of the entity in which a taxpayer sold an ownership interest multiplied by the percentage of the interest in the entity the taxpayer sold.

(1) Each capital gain must meet the requirements of divisions (A)(1)(a) to (c) of this section to be classified as a qualifying capital gain.

(2) The deduction shall equal the lesser of the taxpayer's qualifying capital gain from the sale of each entity or the deductible payroll attributable to that entity. The deduction amounts related to each entity shall then be aggregated to determine the total deduction allowed.