(1) Interest or dividends on U.S. obligations
under ORS
316.680(1)(a)
included in distributions from self-employed plans or individual retirement
accounts as described under sections
401 to
408 of the Internal Revenue Code
shall be subtracted from federal taxable income to determine Oregon taxable
income.
(2) Annuities: The amount
of the subtraction shall be determined by applying a "state exempt-interest
ratio" to distributions received as annuity payments to the extent the payments
are included in federal adjusted gross income for the taxable year. The "state
exempt-interest ratio" is the year-to-date balance of qualifying interest or
dividends under ORS
316.680(1)(a)
included in the account balance prior to the current year distribution divided
by the account balance prior to the current year distribution. The year-to-date
balance of qualifying interest or dividends is equal to the cumulative total of
those earnings less any prior year's subtraction. The ratio shall be applied on
the later of the annuity starting date or the date on which the taxpayer
established residency. The annuity starting date shall be the date determined
under Treas. Reg. Section 1.72-4(b).
To see the formula and several examples, along with
illustrative tables, for this rule click on the PDF link.
(3) Lump-sum distributions: For lump-sum
distributions from individual retirement accounts and self-employed retirement
plans, the subtraction shall be equal to the total qualifying interest under
ORS 316.680(1)(a)
included in the account balance at the time of distribution.
(4) Change of status from nonresident to
resident: Nonresidents who become residents sometime after the annuity starting
date shall use the same formula for computation of the ratio as if they were
residents at the annuity starting date. For purposes of the formula shown in
subsection (2)(a), "a" will equal the year-to-date balance of qualifying
interest or dividends which is equal to the cumulative total of those earnings
less any prior years deemed or actual subtraction.
Notes
Or. Admin. Code §
150-316-0525
RD 11-1988,
f. 12-19-88, cert. ef. 12-31-88; RD 7-1991, f. 12-30-91, cert. ef. 12-31-91; RD
5-1997, f. 12-12-97, cert. ef. 12-31-97; Renumbered from 150-316.681,
REV
64-2016, f. 8-15-16, cert. ef.
9/1/2016;
REV
53-2017, f. & cert. ef.
8/3/2017;
REV
40-2020, amend filed 12/23/2020, effective
1/1/2021
Publications: The publication(s) referred to or incorporated
by reference in this rule is available from the Department of Revenue pursuant
to ORS 183.360(2) and
ORS 183.355(6).
To view attachments referenced in rule text,
click here to view
rule.
Statutory/Other Authority: ORS
305.100
Statutes/Other Implemented: ORS
316.681
