Ohio Annual Application for Distribution Center Qualifying Certificate

Annual Application for Distribution Center Qualifying Certificate
Form CAT QDC
CAT QDC
Rev. 07/23

Commercial Activity Tax Annual Application for Distribution Center
Qualifying Certificate and Ohio Delivery Percentage Certification
for the Qualifying Year Jan. 1, 2024 through Dec. 31, 2024
This annual application pertains only to the Ohio distribution center identified below for the above qualifying year. The application must
be accompanied by a $100,000 annual fee payable to the “Ohio Treasurer of State” and must be filed on or before Sept. 1, 2023 or
within 45 days after the opening of a new distribution center, whichever date is later. Send this completed application along with the fee
to: Ohio Department of Taxation, Revenue Processing Unit, Attn: Leslie Berning, P.O. Box 183077, Columbus, Ohio 43218-3077.
	 Section A
Name and address of distribution center
Street	

City 	

State

	

ZIP code

The distribution center located at the above address is operated by
Name of applicant/operating entity 	

FEIN

Street 	

City 	

State 	

Contact person 	

Phone number 	

ZIP code
E-mail

The “qualifying period” referred to throughout this application is from July 1, 2022 to June 30, 2023. Was the distribution center identified
above operated during the entire qualifying period?
Yes
No
Does the operator of the distribution center identified above, or do persons in the same consolidated elected taxpayer group as the
operator of the distribution center identified above, operate warehouses or other similar facilities within one mile of the distribution
center identified above?
Yes
No Does the operator of the distribution center identified above, or do persons in the same
consolidated elected taxpayer group as the operator of the distribution center identified above, operate a refining facility in the same
or an adjacent county of the distribution center above?
Yes
No [If “yes,” See Ohio Revised Code section (R.C.) 5751.40(A)
(3) and provide a list of other locations and operators on a separate sheet.]

	 Section B
During the above qualifying period, 	
, as operator of the distribution center identified above and
members of the operator’s consolidated elected taxpayer group, met all of the following criteria:
1.	 Purchased qualified property from suppliers (excluding suppliers that are members of the operator’s consolidated elected
taxpayer group) for delivery to the distribution center identified above, in the amount of $
; (Note that such
purchases for delivery to the distribution center must exceed $500 million.)
2.	 The cost of qualified property shipped from the distribution center to Ohio locations during the qualifying period was
	 $
.
3.	 The cost of qualified property shipped from the distribution center to locations everywhere during the qualifying period was
	 $
.

.

4.	 The Ohio delivery percentage on the qualified property sitused to Ohio locations compared with qualified property sitused to
locations everywhere was
%. The cost of qualified property shipped in (2) and (3), above, were calculated
on the same basis.

	 Section C
I declare under penalties of perjury that the information contained in this application, to the best of my knowledge, is correct. In
addition, I agree that, upon request, I will promptly allow an agent(s) of the tax commissioner to inspect the records of the operator of
the distribution center to verify the above amounts and the Ohio delivery percentage.
Signature of officer	

Date	

Title

NOTE: A properly completed Report of Independent Auditor must be attached to this application.

CAT QDC
Rev. 07/23

Report of Independent Auditor
[Appropriate Addressee]
We have audited Section B of the accompanying Commercial Activity Tax Annual Application for Distribution Center Qualifying Certificate
and Ohio Delivery Percentage Certification of [Name of Distribution Center] at [Distribution Center Location] for the qualifying period from
July 1, 20
to June 30, 20
.
Management’s Responsibility for Section B of the Accompanying Commercial Activity Tax Annual Application for Distribution
Center Qualifying Certificate and Ohio Delivery Percentage Certification
Management is responsible for the preparation and fair presentation of Section B of the accompanying Commercial Activity Tax Annual
Application for Distribution Center Qualifying Certificate and Ohio Delivery Percentage Certification in accordance with Ohio Revised
Code (R.C.) section 5751.40 and accounting principles generally accepted in the United States of America; this includes the design,
implementation and maintenance of internal control relevant to the preparation and fair presentation of Section B of the accompanying
Commercial Activity Tax Annual Application for Distribution Center Qualifying Certificate and Ohio Delivery Percentage Certification that
is free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our objectives are to obtain reasonable assurance about whether Section B as a whole is free from material misstatement, whether due
to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not
absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards
will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher
than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control. Misstatements are considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users made on the basis of Section B.
In performing an audit in accordance with generally accepted auditing standards, we:
●	 Exercise professional judgment and maintain professional skepticism throughout the audit.
●	 Identify and assess the risks of material misstatement of Section B, whether due to fraud or error, and design and perform audit
procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts in Section B.
●	 Obtain an understanding of internal control relevant to the audit of Section B in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly,
no such opinion is expressed.
●	 Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by
management, as well as evaluate the overall presentation of Section B.
●	 Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about
the Company’s ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of
the audit, significant audit findings, and certain internal control–related matters that we identified during the audit.
Opinion
In our opinion, Section B of the accompanying Commercial Activity Tax Annual Application for Distribution Center Qualifying Certificate
and Ohio Delivery Percentage Certification presents fairly, in all material respects, the qualifying criteria and Ohio delivery percentage of
[Name of Distribution Center] for the period from July 1, 20
to June 30, 20
, in accordance with R.C. section 5751.40 and
accounting principles generally accepted in the United States of America.
Other Matter
We have not audited the information in Sections A and C of the accompanying Commercial Activity Tax Annual Application for Distribution
Center Qualifying Certificate and Ohio Delivery Percentage Certification of [Name of Distribution Center] and, accordingly, we do not
express an opinion on Sections A and C.
Restriction on Use
Our report is intended solely for the information and use of management of [Name of Distribution Center Applicant/Operator] and the Ohio
Department of Taxation, and is not intended to be and should not be used by anyone other than these specified parties.

Accounting firm

Accounting firm office

Date of report

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CAT QDC
Rev. 07/23

Qualifying Certificate Information and Instructions
The tax commissioner will issue to the operator of the distribution
center for which this application is filed a qualifying certificate1
certifying the distribution center as a qualifying distribution
center for the 2024 qualifying year only if (i) the applicant pays the
$100,000 annual fee; (ii) the operator of the distribution center is not
part of a CAT combined taxpayer group (see R.C. 5751.012(A)); and
(iii) the applicant substantiates to the tax commissioner’s satisfaction
that during the qualifying period July 1, 2022 to June 30, 2023 the
following thresholds are met:
	

	
	

a.	 The operator of the distribution center purchased from its
suppliers (excluding suppliers that are members of the
operator’s consolidated elected taxpayer group) at least $500
million of qualified property for delivery to the distribution
center; and
b.	 The cost of qualified property shipped by the operator from
the distribution center to Ohio locations during the qualifying
period was less than 50% of the cost of qualified property
shipped from the distribution center to locations everywhere
during the qualifying period (cost being determined on a
consistent and generally recognized method).

Note: In determining whether the above thresholds are met,
members of a consolidated elected taxpayer group are considered
one taxpayer. The operator of a qualifying distribution center is
deemed to be the person actually operating the distribution center
along with each member of that person’s consolidated elected
taxpayer group that purchases and receives qualified property
at the qualified distribution center. While a qualified distribution
center, by definition, cannot be operated by a person that is a
member of a combined taxpayer group, a qualified distribution
center can be operated by a person or persons that are members
of a consolidated elected taxpayer group.
	
The applicant meets the tax commissioner’s substantiation
requirement in (a) and (b), above, only if:
	

	

	
	

•	 The operator of the distribution center attaches to this
application a schedule showing each of the following: (i)
the amount of qualified property purchased from suppliers
delivered to the distribution center; (ii) the cost of qualified
property shipped from the distribution center to Ohio locations
during the qualifying period; (iii) the cost of qualified property
shipped from the distribution center to locations everywhere
during the qualifying period; and (iv) the Ohio delivery
percentage (carried out to four decimal places – XX.XXXX%).
•	 An officer of the distribution center’s operator signs and dates
the statement in Section C of this application attesting to the
information contained on the application and declaring that,
to the best of his/her knowledge, the information is correct. In
addition, the officer must agree to allow the tax commissioner
to inspect the records of the operator of the distribution center
in order to verify all amounts.
•	 An independent certified public accountant signs and
dates the Report of Independent Auditor accompanying
this application. That report must be signed and completed
by an independent certified public accountant and not an
employee of the operator or the operator’s taxpayer group.
Absent approval by the tax commissioner, the exact verbiage
must be used, replacing “[Name of Distribution Center]”,
“[Distribution Center Location]”, and “[Name of Distribution

Center Applicant/Operator]” with the name and location of
the distribution center, as well as the name of the distribution
center applicant/operator. In addition, the complete years must
be inserted for both the beginning and ending of the qualifying
period.
	

•	 The operator of the distribution center furnishes both (a)
the cost of property shipped from the distribution center to
Ohio locations during the qualifying period; and (b) the cost
of property shipped from the distribution center to locations
everywhere during the qualifying period.

If the tax commissioner approves this annual application by issuing
a qualifying certificate to the applicant for the distribution center
identified on the application, then for the qualifying year (calendar
year 2024) each supplier to the distribution center, except for those
suppliers that are members of the operator’s consolidated elected
taxpayer group, can exclude from the supplier’s gross receipts
subject to the CAT the supplier’s qualifying distribution center
receipts. A supplier’s qualifying distribution center receipts are
the supplier’s receipts from qualified property (qualified property is
tangible personal property shipped by the supplier to the distribution
center solely for storing, repackaging and further shipping – but
not manufacturing or processing) multiplied by the quantity one
minus the distribution center’s certified Ohio delivery percentage.
(The distribution center’s Ohio delivery percentage is the ratio of
the cost of property shipped from the distribution center to Ohio
locations during the qualifying period (July 1, 2022 through June
30, 2023) to the cost of property shipped from the distribution center
to locations everywhere during the qualifying period (July 1, 2022
through June 30, 2023).
Definitions
“Qualifying certificate” means the certificate issued by the tax
commissioner after the operator of a distribution center files an
annual application with the commissioner. The application and
annual fee shall be filed and paid for each qualified distribution
center on or before the first day of September before the qualifying
year or within forty-five days after the distribution center opens,
whichever is later. R.C. section 5751.40(B)(1).
“Qualified distribution center” means a warehouse, a facility
similar to a warehouse, or a refining facility in this state that, for the
qualifying year, is operated by a person that is not part of a combined
taxpayer group and that has a qualifying certificate. All warehouses
or facilities similar to warehouses that are operated by persons in
the same taxpayer group and that are located within one mile of
each other shall be treated as one qualified distribution center. All
refining facilities that are operated by persons in the same taxpayer
group and that are located in the same or adjacent counties may
be treated as one qualified distribution center.
“Qualifying year” means the calendar year to which the qualifying
certificate applies. R.C. section 5751.40(A)(4).
“Qualifying period” means the period of the first day of July of
the second year preceding the qualifying year through the 30th
day of June of the year preceding the qualifying year. R.C. section
5751.40(A)(5).
“Qualified property” means tangible personal property delivered
to a qualified distribution center that is shipped to that qualified
1

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Terms defined in the law appear in bold print the first time they are used.

CAT QDC
Rev. 07/23

Qualifying distribution
center receipts

=

The supplier’s 2024
receipts from qualified
property delivered to the
qualified distribution center

x

distribution center solely for further shipping by the qualified
distribution center to another location in this state or elsewhere
or, in the case of gold, silver, platinum or palladium, delivered to a
refining facility solely for refining to a grade and fineness acceptable
for delivery to a registered commodities exchange. “Further
shipping” includes storing and repackaging property into smaller
or larger bundles, so long as the property is not subject to further
manufacturing or processing. “Refining” is limited to extracting
impurities from gold, silver, platinum or palladium through smelting
or some other process at a refining facility.
“Ohio delivery percentage” means the proportion of the total
property delivered to a destination inside Ohio from the qualified
distribution center during the qualifying period compared with total
deliveries from such distribution center everywhere during the
qualifying period. R.C. section 5751.40(A)(7).
“Qualifying distribution center receipts” means receipts of
a supplier from qualified property that is delivered to a qualified
distribution center, multiplied by a quantity that equals one minus
the Ohio delivery percentage. R.C. section 5751.40(A)(1).
QDC Application Instructions
Section A
•	 Enter the name and address of the distribution center for which
the application is being filed.
•	 Enter the name, FEIN and address of the operating entity of the
distribution center for which the application is being filed. Include
the name, phone number and e-mail address of the contact
person for the operating entity.
•	 Was the applicant distribution center in operation during the entire
qualifying period?
•	 Does the operator of the applicant distribution center (or do
members of the same consolidated elected taxpayer group)
also operate similar distribution centers within one mile of the
applicant-distribution center?

(1–

The cost of property shipped from the distribution
center to Ohio locations during the qualifying period
July 1, 2022 through June 30, 2023
The cost of property shipped from the distribution
center to locations everywhere during the qualifying
period July 1, 2022 through June 30, 2023

)

•	 Does the operator of the distribution center identified above, or
do persons in the same consolidated elected taxpayer group as
the operator of the distribution center identified above, operate a
refining facility in the same or an adjacent county of the distribution
center?
•	 If the operator or other members of the operator’s consolidated
elected taxpayer group operate similar distribution centers to that
of the applicant distribution center, all such distribution centers
are included as one qualified distribution center for purposes of
this application.
Section B
•	 Enter the name of the operator for the applicant distribution center
in the first blank.
•	 On line 1, enter the amount of qualified property the applicant
distribution center purchased from suppliers during the qualifying
period. For purposes of this calculation, suppliers that are
members of the operator’s consolidated elected taxpayer group
may not be included. The amount entered on line 1 must be more
than $500 million.
•	 On line 2, enter the cost of qualified property shipped from the
distribution center to Ohio locations during the qualified period.
•	 On line 3, enter the cost of qualified property shipped from the
distribution center to locations everywhere during the qualified
period. This figure should include the amount entered on line 2.
•	 Divide line 2 by line 3 to arrive at the Ohio delivery percentage.
Section C
•	 This section must be completed by an officer of the applicant
distribution center.

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