Information current as of April 30, 2021.
COVID-19 has changed life across the globe. Many taxing jurisdictions are taking mitigating actions to create social distance and aid taxpayers. The following is a running list of actions by jurisdiction, which generally result in additional time to file and/or pay. Further, many jurisdictions have closed their offices to in-person use by taxpayers and suspended their audit and administrative functions. This alert doesn’t cover similar waivers from local-level taxing authorities. These developments continue to quickly evolve; check with your BKD Trusted Advisor™ or visit our COVID-19 Resource Center for current information as needed.
Information Specific to Oregon
- Oregon issued information on economic impact payments for individual income tax purposes. The payments aren’t taxed as income in the state but may affect federal tax calculations used on tax returns. For tax-year 2020, tax filers may subtract the first $6,950 in federal taxes paid from state taxable income. Taxpayers who won’t be affected include 1) lower-income taxpayers who don’t have a federal tax liability; 2) taxpayers whose federal income tax paid, after subtracting the total of their economic impact payments, is greater than $6,950; and 3) taxpayers who didn’t receive economic impact payments or won’t receive the recovery rebate credit as determined by the IRS.
- Oregon Department of Revenue, Economic Impact Payments Notice, February 1, 2021.
- Oregon updated its COVID-19 nexus guidance. Previously, Oregon announced that for the purposes of the corporate excise (income) tax, the presence in Oregon of teleworking employees of an employer corporation wouldn’t be treated by Oregon as a relevant factor when making a nexus determination if the employee(s) in question would otherwise have been regularly based outside Oregon absent the COVID-19 pandemic. The guidance has been expanded for purposes of the personal income tax. The guidance applies between March 8, 2020, and the expiration of the COVID-19 notice. The notice expires the later of 1) the expiration date of Oregon Executive Order 20-67; 2) the date of expiry of an emergency declaration, a stay-at-home or similar government order related to COVID-19 and issued by the state government for the employee’s assigned work location; or 3) December 31, 2021.
- Oregon DOR, Tax Relief Options; March 15, 2021.
- Oregon is automatically extending the income tax filing due date for individuals for the 2020 tax-year from April 15, 2021, to May 17, 2021. Individual taxpayers also can postpone state income tax payments for the 2020 tax-year due on April 15, 2021, to May 17, 2021, without penalties and interest, regardless of the amount owed. This postponement applies to individual taxpayers, including individuals who pay self-employment tax. Individual taxpayers don’t need to file any forms or call the Department of Revenue to qualify for this automatic tax filing and payment relief. Individual taxpayers who need additional time to file beyond the May 17 deadline can request a filing extension until October 15 by filing the federal extension. Oregon recognizes a taxpayer’s federal extension.
- State of Oregon; News Release; March 17, 2021.
- Oregon issued clarification on the extended tax filing deadline for tax-year 2020. The April 30 due date for Quarterly Statewide Transit Tax Withholding returns and payments for the first quarter isn’t extended. Taxpayers have until May 17 to contribute to their individual retirement accounts for tax-year 2020. The April 15 estimated income tax payment due date for tax-year 2021 hasn’t been extended. Lastly, contributions to Oregon 529 College Savings Network accounts need to be made by April 15 to qualify for the refundable credit.
- Oregon DOR, Tax-Year 2020 Filing FAQs; March 25, 2021.
- Oregon will adjust 2020 state income tax returns for those who have already filed but received unemployment benefits that are now exempt from tax. Adjustments will be made to exempt up to $10,200 of unemployment benefits per person in 2020 for households with less than $150,000 in income in accordance with federal provisions under the American Rescue Plan Act of 2021. Taxpayers who already filed their 2020 returns don’t need to file an amended return, and most of the thousands of affected taxpayers will receive a refund. Those who haven’t yet filed should just flow through the adjustment with federal taxable income to their Oregon return.
- Oregon DOR, News Release; March 26, 2021.
- Oregon provided guidance on state tax treatment of the Employee Retention Credit. The state allows a subtraction equal to the total amount of wage expense reduction on the federal income tax return, so taxpayers should subtract the federally disallowed wage expense in the tax-year taxpayers first claimed the federal credit. Individuals, partners, and S corporation shareholders should use subtraction code 340, and corporations should use subtraction code 354.
- Oregon DOR, FAQs; April 28, 2021.