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Department of Revenue: Personal Income Tax

Oregon Connection to Federal Law
For tax year 2011
For tax year 2011 - Oregon is tied to December 31, 2010 federal income tax laws. Oregon has a rolling tie to federal changes made to the definition of taxable income with the following exceptions:
 
  • IRC section 139A for Federal Subsidies for Prescription Drug Plans;
  • IRC section 199 for Income Attributable to Domestic Production Activities, also known as Qualified Production Activity Income (QPAI).

Income under these sections is specifically exempt from tax on the federal return. If you have any of these types of income, you will have an addition on your Oregon tax return.

Frequently Asked Questions
Question: I filed a return and added back some items that we are now connected to (for example, the tuition and fees deduction).  Will the department make the adjustment or should I amend?

Answer:  You need to file an amended return removing the addition.



Question: I forgot to add back the depreciation and expensing differences.  Should I file an amended return or will the department make the adjustment?

Answer:  You need to file an amended return with the add back in order to avoid the possibility of additional penalties and interest later.
For tax year 2010
For tax year 2010 – Oregon was disconnected from federal law (and an addition on the 2010 return is required) for the following items:
 
-IRC section 139A (federal subsidies for prescription drug plans) [ORS 316.837; ORS 317.401]

-IRC section 199 (domestic production activities – QPAI) [ORS 316.836; ORS 317.398]

-IRC section 108(i) (discharge of indebtedness from the reacquisition of an applicable debt instrument after December 31, 2008) [ORS 316.739(1); ORS 317.301(1)]

-IRC section 179 (temporary federal increase of 179 expense deduction) [ORS 316.739(3) ORS 317.301(3)]

-IRC section 168(k) (bonus deprecation) [ORS 316.739(2); ORS 317.301(2)]