Accumulation distribution from certain domestic trusts (ORS 316.737) [Addition code 132]
If you used federal Form 4970 to figure the partial tax on a distribution of accumulated income from a domestic trust created before March 1, 1984, contact us or email the Fiduciary Unit at firstname.lastname@example.org for information about this addition.
Achieving a Better Life Experience (ABLE) Account nonqualified withdrawal [ORS 316.680(2)(k)] [Addition code 164]
Did you withdraw funds from an Oregon ABLE account for a purpose other than paying for qualified disability expenses? If the withdrawn funds were from contributions previously subtracted on your Oregon return, you must report an addition on Schedule OR-ASC or OR-ASC-NP for the amount you withdrew. Qualified disability expenses are defined in IRC Section 529A.
Capital loss carryover difference [Addition code 162]
This addition affects few taxpayers. You'll have an addition on your Oregon return only if you're carrying over a capital loss from last year’s return and last year’s federal AGI was within the limits shown in Table 6.
Claim of right income repayments [ORS 316.680(1)(i)] [Addition code 103]
Are you taking a deduction on your federal return under IRC Section 1341(a) for a repayment of more than $3,000 that was included in a prior year’s taxable income under a claim of right? If you’re claiming the Oregon credit for the same repayment, you can’t deduct the repayment on your Oregon return.
If you claimed the repayment deduction on Schedule OR-A, see “Itemized deduction add backs” in “Other items.” If you claimed the repayment deduction on a federal form or schedule other than Schedule A, you must add back the deduction as an addition on Schedule OR-ASC, section 1 or Schedule OR-ASC-NP, section 3.
Depletion in excess of property basis [ORS 316.680(2)(d)] [Addition code 151]
Depletion is using up natural resources by mining, quarrying, drilling, or felling. The depletion deduction allows an owner or operator to account for the reduction of a product’s reserves.
If you claim percentage depletion on your federal return, you must add to your Oregon income any depletion that is more than your adjusted basis in the property. The addition includes any depletion in excess of basis taken by an S corporation or partnership of which you are a shareholder or partner. Usually you need to add to Oregon income any depletion that is a preference item subject to the federal alternative minimum tax.
Disposition of inherited Oregon farmland or forestland (ORS 316.844) [Addition code 106]
You may have an addition on your return if:
• You dispose of farmland you inherited from someone who died on or after October 5, 1973, and before January 1, 1987; or
• You dispose of forestland you inherited from someone who died on or after November 1, 1981, and before January 1, 1987.
You may have this addition because the valuation of the land for Oregon inheritance tax purposes may differ from the valuation for federal estate tax purposes. Generally, the federal valuation is the fair market value of the property at the date of the previous owner’s death. The Oregon valuation is usually less than the federal valuation, because for inheritance tax purposes the property may have been valued as farm-use or forestland.
Federal business income deduction (Or Laws 2018, ch 108, § 10) [Schedule OR-ASC-FID only: Addition code 185]
Oregon is disconnected from the federal deduction for qualified business income in IRC Section 199A
Federal election on interest and dividends of a minor child (ORS 316.372) [Addition code 107]
Did you report the interest or dividends of your minor child on your federal return? If so, you must add the amount subject to the special federal tax to Oregon income. You must also include any interest or dividends your child received on bonds or notes of another state or political subdivision of another state that you didn’t include on your federal return.
Federal income tax refunds (ORS 316.685) [Addition code 109] [Modification code 601]
Did you get a federal tax refund because of a federal audit or amended return? If so, you may need to add part or all of that refund to your Oregon income. An explanation of the federal tax liability subtraction can be found in “Subtractions.”
Federal subsidies for employer prescription drug plans (ORS 316.837) [Addition code 123]
Employers who provide a prescription drug plan for their retired employees may receive a federal subsidy if they meet the requirements in 42 U.S.C. Section 1395w-132. This subsidy is excluded from federal taxable income under IRC Section 139A. Oregon law doesn’t allow this exclusion. If you’re an employer with a qualified plan for your retired employees and you received this subsidy, you’ll have an addition on your Oregon return.
Income taxes paid to another state by a pass-through entity (ORS 316.082) [Addition code 148]
If you claim a credit for income taxes paid to another state by a pass-through entity (PTE) of which you're an owner, and the PTE is deducting the tax on its own return, you'll have an addition on your return for the amount of tax paid or deducted by the PTE. Note: See the instructions for fiduciary returns at the end of this section if a credit is claimed on Form OR-41.
Individual development account (IDA) (ORS 316.848) [Addition code 137 or 159]
For more information about IDAs, see this topic under "Subtractions."
Interest and dividends on government bonds of other states [ORS 316.680 (2)(b)] [Addition code 158]
Full-year residents. Oregon taxes interest and dividends on bonds and notes of another state or political subdivision of another state that you didn’t include on your federal return. This income is an addition using Schedule OR-ASC. Did you report the interest or dividends of your minor child on your federal return? And, did your child receive interest or dividends from another state or political subdivision? If so, include this income as an addition using Schedule OR-ASC. See “Federal election on interest and dividends of a minor child.”
Lump-sum distributions (ORS 316.737) [Addition code 139]
Did you complete federal Form 4972 to figure the tax on your qualified lump-sum distribution using the 20 percent capital gain election and/or the 10-year tax option? If so, part or all of your lump-sum distribution wasn't included in your federal AGI. The excluded portion of your distribution must be included as an addition to your Oregon income. See the examples below.
Nonresident capital losses and loss carryforwards (OAR 150-316-0006) [Addition code 161]
Capital losses and losses carried forward from prior years may be claimed on an Oregon return only if:
• The capital loss was incurred while you were an Oregon resident; or
• If you were a nonresident when the capital loss was incurred, the loss was attributable to Oregon sources.
If you have a capital loss or are carrying forward a loss from a prior year on this year’s return (or are using the loss to offset capital gain), and the loss doesn’t meet these requirements, you will have an addition on your Oregon return.
Oregon College and MFS 529 Savings Plan nonqualified withdrawal [ORS 316.680(2)(j)] [Addition code 117]
Did you withdraw funds from an Oregon College or MFS 529 Savings Plan account for nonqualified purposes, where the funds were subtracted on a prior year’s Oregon return? Nonqualified purposes include using funds in the account to pay tuition at a K-12 school. If so, you must report an addition on Schedule OR-ASC or OR-ASC-NP for the amount you withdrew. IRC Section 529(e) defines qualified higher education expenses. If a portion of the withdrawal was used for qualified purposes, use any reasonable method to determine the amount of the addition. Keep a copy of this determination with your tax records. For more information about these plans see this topic under “Subtractions.”
Unused business credits [ORS 316.680(2)(f)] [Addition code 122]
Did you claim a deduction on your federal return for unused business credits (UBC)? Oregon doesn’t allow this deduction.