Chapter 150-314

150-314-0205 Substantial Understatement Penalty (SUP) (1) The department will assess a penalty if a substantial understatement of net tax exists for any taxable year. The penalty is equal to 20 percent of the amount of any underpayment of net tax attributable to the understatemen…

150-314-0207 Waiver of 20 Percent Substantial Understatement of Net Tax Penalty Imposed under ORS 314.402 (1) The department will waive the penalty if the taxpayer shows that there was reasonable cause for the understatement and that the taxpayer acted in good faith. (2) The depa…

150-314-0209 Substantial Authority, Adequate Disclosure and Reasonable Basis (1) Definitions. For purposes of ORS 314.402, OAR 150-314-0205, and this rule: (a) “Substantial authority” has the same meaning as used in Treasury Regulation 1.6662-4(d). (b) “Adequate disclosure” has t…

150-314-0215 Listed Transaction Understatement; Penalty (1) “Return of the taxpayer” for purposes of this penalty is defined as the original return filed with the department that contains a listed transaction understatement, or the most recent amended return filed with the depart…

150-314-0220 Additional Assessments (1) The filing of a ‘tentative return’ which does not reveal the details of income or deductions is not considered a filing within the meaning of ORS 314.410, and the statute of limitations upon an additional assessment does not begin to run un…

150-314-0222 Five-Year Statute of Limitations (1) For tax years beginning before January 1, 2014, the term “gross income” as used in ORS 314.410(2) has the same meaning as provided under section 61 of the Internal Revenue Code. For tax years beginning on or after January 1, 2014,…

150-314-0224 Time Limit to Make Adjustment (1) The provisions of this rule that apply to a federal change or correction apply to reports that are received by the department on or after October 4, 1997. The provisions of this rule that apply to another state's change or correction…

150-314-0226 Notification of Gain Realized Upon the Sale or Exchange of a Principal Residence (1) The period for the assessment of any deficiency attributable to any part of the gain realized upon the sale or exchange of the taxpayer's principal residence shall not expire prior t…

150-314-0228 Extension of Period for Assessment Once the provisions of ORS 314.410(6) have been exercised, the Department and the taxpayer may, by written agreement, extend beyond the original agreed period the period for mailing a notice of deficiency or assessing a deficiency, …

150-314-0230 Effect of Federal Extension of Period for Assessment If a taxpayer and the Commissioner of Internal Revenue, or the taxing authority of another state, enter into an agreement, or renewal thereof, extending the period of time for giving notices of deficiencies and ass…

150-314-0240 Refunds Generally (1) Refund Limitations - Time and Amount. (a) If the amount of the tax imposed by the statute is less than the amount paid by the taxpayer and the taxpayer does not then owe any other tax or liability to the State of Oregon, such overpayment must be…

150-314-0242 Refunds (1) The return of the taxpayer, filed timely and in the prescribed manner, constitutes a claim for refund under the provisions of this section. For the purpose of determining when the three-year period for claiming a refund expires, the due date of a return i…

150-314-0244 Minimum Offset Amount (1) The department is prohibited by statute from issuing refunds of less than the minimum allowed by ORS 314.415 after reduction for amounts owed. The department will not apply a refund less than the minimum to a subsequent year’s estimated tax …

150-314-0246 Interest Computation — Offset (1) An overpayment of any tax imposed and interest on the overpayment, if any, must be offset against any tax, penalty, or interest then due from the taxpayer. “Tax, penalty or interest then due from the taxpayer” means any amount of tax…

150-314-0248 Refund Offset Priority (1) As used in this rule: (a) “Appropriation accounts” means accounts that are established by an appropriation of the state legislature. (b) “Nonassessed accounts” means: tax accounts for which the department has determined a deficiency exists …

150-314-0250 Refunds; Net Operating Loss and Net Capital Loss Carryback Claims (1) Application. For purposes of this rule, provisions applying to individuals also apply to estates and trusts. (2) Extended period for refund claim. (a) A special period of limitations is provided un…

150-314-0252 Effect of Federal Extension of Period for Assessment If a taxpayer and the Commissioner of Internal Revenue enter into an agreement, or renewal thereof, extending the period of time for giving notices of deficiencies and assessing deficiencies of federal income tax f…

150-314-0254 Separate Refunds When a Joint Return Has Been Filed (1) The department may, as a convenience to taxpayers, issue separate refunds when either spouse submits a signed request. To issue separate refunds when a joint refund check has already been issued, the check must …

150-314-0256 Refunds of Tax Overpayments to Spouse or Heirs (1) For deaths which occur on or after September 9, 1995: Upon the death of a taxpayer entitled to a refund not in excess of $10,000, when the estate is not probated, refunds may be made to survivors by classes upon fili…

150-314-0265 Model Recordkeeping and Retention (1) Definitions. For purposes of this rule, these terms shall be defined as follows: (a) “Database management system” means a software system that controls, relates, retrieves, and provides accessibility to data stored in a database.…

150-314-0267 Requirement to Provide Copies of Documents (1) Definitions for purposes of this rule. (a) “Photocopy” (photocopied) means a copy or reproduction of an original document including books and papers; to make a photographic reproduction of any document, printed, pictoria…

150-314-0275 Definition: Collection Charge As used in ORS 314.430(1) “collection charge” includes: (1) The fees and costs listed in ORS 18.999(4), related to recovery of expenses incurred in enforcing judgments, and (2) All fees or charges of the Secretary of State imposed under …

150-314-0277 Payment Secured by Bond, Deposit or Otherwise The issuance of a warrant to the sheriff to enforce collection of delinquent taxes will be stayed either by paying the amount of assessed taxes, penalties and accrued interest after it becomes due or by securing payment o…

150-314-0279 Statute of Limitation on Tax Collection No statute of limitation runs on a tax self-assessed or additionally assessed by the Department in the time allowed by ORS 314.410 and collectible by warrant. However, the statute of 10 years limitation on judgment liens begins…

150-314-0285 Assessment of Withholding Tax Against Liable Officers The provisions of this rule dealing with hearings apply to hearing requests filed with the Department of Revenue prior to September 1, 1997. See OAR 150-305.525 for information about hearing requests filed on or a…

150-314-0290 Estimated Tax: When Estimates Are Required; Refunds Prior to Filing of Return (1) Every corporation or group of corporations required to file an Oregon excise or income tax return and expecting to have a tax liability of $500 or more must make estimated tax payments.…

150-314-0292 Estimated Tax: When Estimates Are Required For Tax Exempt Corporations Tax exempt corporations subject to tax on their “Unrelated Business Income” and that are required to file and pay federal income taxes, must also file an Oregon tax return. If their Oregon tax lia…

150-314-0294 Estimated Tax: Affiliated Corporations (1) If two or more affiliated corporations file a consolidated state return as described in ORS 317.710 through 317.725, each shall be jointly and severally liable for the filing and payment of the estimated tax liability. Estim…

150-314-0300 Estimated Tax: Due Dates of Payments for Short-Period Returns If a return is filed for a short period of less than 12 months, the estimated tax payments are due as follows: (1) If the period covered is less than four months, only one payment is required. It is equal …

150-314-0302 Estimated Tax: Application of Payments (1) Overpayments of tax (a) Election. When a corporation files its completed excise or income tax return and the tax shown due thereon is less than the amounts previously paid for that year, the corporation may make an irrevocab…

150-314-0310 Requirement to Use Electronic Funds Transfer (1) For tax years beginning on or after January 1, 2002, corporations are required to make estimated Oregon Corporation Excise or Income Tax payments by electronic funds transfer (EFT) if required to pay federal corporatio…

150-314-0315 Corporation Estimated Tax: Delinquent or Underestimated Payment or Both, Constitutes Underpayment (1) An underpayment of corporation estimated tax exists when the payments received on or before a payment due date are less than the required payment due as determined u…

150-314-0317 Estimated Tax: Consolidated Return Underpayments (1) If a consolidated state return is filed, any underpayment shall be computed on a consolidated basis. In computing the underpayment on a consolidated basis, the tax and facts shown on the returns for the preceding y…

150-314-0319 Estimated Tax: Apportioned Returns Corporations that are required to apportion income between Oregon and other states, are required to use either the current period’s actual or the prior full year’s apportionment factor to meet the annualization exception to underpay…

150-314-0321 Estimated Tax: Application of Net Loss, Annualized Income Exception In computing the annualized income, the net loss from a prior year carried forward shall be applied in the same manner as in the Internal Revenue Service Revenue Ruling (RR) 67-93. The RR 67-93 provi…

150-314-0323 Estimated Tax: Interest on Underpayment (1) When an estimated tax payment is underpaid, as defined in OAR 150-314-0315, interest accrues on the underpaid amount at the rate provided in OAR 150-305-0140 from the due date of the payment to the earlier of the date the t…

150-314-0325 Estimated Tax: Computation of Underpayment (1) Underpayment charges shall be assessed on the last filed return received before the due date for such return. That return shall be considered the “original return,” and the tax due shall be used as the basis for computin…

150-314-0327 Underpayment of Estimated Tax; First and Second Installment for Large Corporations (1) The first required installment is the lowest payment computed under ORS 314.525(2)(a) through (2)(d). (2) If a large corporation qualifies for the exception to paying interest on u…

150-314-0335 Apportionable and Nonapportionable Income Defined (1) This rule adopts a model regulation recommended by the Multistate Tax Commission to promote uniform treatment of this item by the states. This rule applies to tax years beginning on or after January 1, 2018. (2) A…

150-314-0337 Apportionable and Nonapportionable Income; Application of Definitions (1) This rule adopts a model regulation recommended by the Multistate Tax Commission to promote uniform treatment of this item by the states. This rule is applicable to tax years beginning on or af…

150-314-0339 Proration of Deductions (1) This rule adopts a model regulation recommended by the Multistate Tax Commission to promote uniform treatment of this item by the states. (2) Proration of deductions. In most cases an allowable deduction of a taxpayer will be applicable on…

150-314-0345 Apportionment and Allocation of Income Generally (1) If the business activity in respect to any trade or business of a taxpayer occurs both within and without this state, and if by reason of such business activity the taxpayer is taxable in another state, the portion…

150-314-0347 Application of ORS 314.610 to 314.667: Allocation Any taxpayer subject to the taxing jurisdiction of this state shall allocate all of its nonapportionable income or loss within or without this state in accordance with ORS 314.625 to 314.645. Statutory/Other Authority…

150-314-0349 Apportionment and Allocation for a Taxpayer Carrying on a Unitary Business Where the taxpayer’s Oregon business activities are a part of a unitary business carried on both within and without the state, use of the apportionment method is mandatory to determine the por…

150-314-0351 Two or More Businesses of a Single Taxpayer (1) A taxpayer may have more than one “trade or business”. In such cases, it is necessary to determine the apportionable income attributable to each separate trade or business. The income of each business is then apportione…

150-314-0353 Apportionment for Long-Term Construction Contracts (1) This rule adopts a model regulation recommended by the Multistate Tax Commission to promote uniform treatment of this item by the states. If a taxpayer elects to use the percentage of completion method of account…

150-314-0355 Special Rules: Installment Sales (1) Income from installment sales is reported at least in part in a year other than the year in which the sale took place. Apportionment of installment sale income on the basis of the factors in the years other than the year of sale w…

150-314-0357 Modified Factors for Motion Picture and Television Film Producers (1) This regulation applies to motion picture and television film producers and producers of television commercials. (2) Definitions. (a) “Film” means the physical embodiment of a play, story, or other…

150-314-0365 Taxable in Another State; In General Under ORS 314.615 the taxpayer is subject to the allocation and apportionment provisions of ORS 314.610 to 314.667 if it has income from business activity that is taxable both within and without this state. A taxpayer’s income fro…

150-314-0367 Taxable in Another State; When a Taxpayer is “Subject To” Tax Under ORS 314.620(1) (1) A taxpayer is “subject to” one of the taxes specified in ORS 314.620(1) only if it carries on business activity in such state and such state imposes such a tax thereon. Any taxpaye…