The taxpayer, a designer, marketer, and wholesaler of apparel and other fashion accessories, shipped products to its customer’s Ohio distribution center. The taxpayer argued that most of its products were subsequently shipped by its customer outside of Ohio after being received at the Ohio distribution center. And, because of this subsequent shipment, the taxpayer should be entitled to reduce its Ohio Commercial Activity Tax sales factor numerator. The Supreme Court of Ohio rejected the taxpayer’s position because it failed to document the amount of products that were shipped outside of Ohio.

The taxpayer presented testimony evidence of one of its employees who stated that he was certain that at least eighty percent of the products were shipped outside of Ohio. Additional evidence was provided by an employee of the taxpayer’s legal representative who provided a calculation using data from a subsequent period. The Court found that the evidence presented was not the type of supporting documentation sufficient to justify the taxpayer’s refund claim. 

Jones Apparel Group/Nine W. Holdings v. Harris, 2026-Ohio-74 (2026).