Dayton Local Tax Guide (2026)
Understanding how local taxes work in Dayton, Ohio, and how they affect your take-home pay.
In this guide
Last updated: October 1, 2026
- •Dayton has a local income tax that applies to income earned in the city.
- •Residents pay 2.50% on all income.
- •Local tax is separate from Ohio state tax and federal tax. Both are calculated independently and add to your total tax burden.
- •Local tax directly reduces your take-home pay. Combined with state and federal taxes, the total tax burden can be significant for high earners.
What Dayton local tax costs at three incomes
The 2.50% resident rate is charged on top of federal tax, Ohio state tax and FICA. Priced for 2026, a $75,000 salary loses $1,875 to Dayton alone and takes home $58,371: a combined 22.2% of gross across all four.
| Salary | Dayton tax | Ohio tax | Federal + FICA | Take-home | Total rate |
|---|---|---|---|---|---|
| $50,000 | $1,250 | $659 | $7,645 | $40,446 | 19.1% |
| $75,000 | $1,875 | $1,346 | $13,408 | $58,371 | 22.2% |
| $120,000 | $3,000 | $2,584 | $26,750 | $87,666 | 26.9% |
How Dayton compares
Of the 62 US jurisdictions that levy a local income tax, Dayton ranks 31st by resident rate, level with 5 other jurisdictions. The median is 2.50%, the highest is New York City at 3.078%–3.876%, and the lowest is St. Louis at 1.00%. Immediately above Dayton sits Columbus (2.50%) and below it Toledo (2.50%).
Within Ohio, 8 jurisdictions charge a local income tax and Dayton is the 6th highest. Same salary, different address:
What local taxes apply in Dayton
Dayton has a local income tax that applies to income earned in the city.
Key Takeaway
| Residency Status | Rate | Applies To |
|---|---|---|
| Resident | 2.50% | All income |
Dayton has a local income tax that applies to income earned in the city. The rate depends on whether you're a resident or non-resident.
Dayton has a local income tax that applies to income earned in the city.
Residents: If you live in Dayton, you pay 2.50% on all your income.
Want to see this with your numbers? Try the calculator with your numbers →
How they interact with state taxes
Dayton local tax is calculated separately from Ohio state income tax. Both taxes are calculated on your taxable income and are withheld by your employer.
Tax Deduction
Dayton local tax is calculated separately from Ohio state income tax. This means:
- Local tax is in addition to state tax, not instead of it
- Both taxes are calculated on your taxable income (or wages, depending on the tax type)
- Your employer withholds both local and state taxes from your paycheck
- You may be able to deduct local tax on your state tax return, depending on Ohio tax rules
For example, if you earn $100,000 in Dayton, you pay Ohio state tax on that income, plus Dayton local tax. The local tax doesn't reduce your state taxable income.
Want to see this with your numbers? Try the calculator with your numbers →
Who is affected
You're subject to Dayton local tax if you live in the city or work in the city, depending on whether you're a resident or non-resident.
You're subject to Dayton local tax if:
- You live in Dayton (residents pay on all income)
- You're self-employed and perform work in Dayton
Want to see this with your numbers? Try the calculator with your numbers →
Common paycheck misconceptions
Common misunderstandings about Dayton local tax, including when it applies and how it's calculated.
Common misconceptions about Dayton local tax:
- "It's the same as state tax": False. Local tax is separate from Ohio state tax and is calculated independently.
- "I only pay if I live there": True for residents, but check if non-residents are subject to tax.
- "Remote work means no tax": If you're a Dayton resident, you typically pay on all income regardless of where you work.
Take-home pay impact
Dayton local tax directly reduces your take-home pay. The amount depends on your income level and whether you're a resident or non-resident.
Dayton local tax directly reduces your take-home pay. For example, if you earn $100,000 as a Dayton resident:
- Local tax: approximately $2500 annually
- This reduces your bi-weekly paycheck by about $96
- Combined with Ohio state tax and federal tax, the total tax burden can be significant
To see exactly how Dayton local tax affects your paycheck, use our calculator above. You can adjust your income, filing status, and deductions to see how different scenarios affect your net pay.
Want to see this with your numbers? Try the calculator with your numbers →
Does this apply to you?
Determine whether you're subject to Dayton local tax based on where you live and work.
Check Your Pay Stub
You're subject to Dayton local tax if:
- You live in Dayton (residents pay on all income)
You're not subject to Dayton local tax if you live and work outside the city, even if you're a Ohio resident.