TAX NEWS - DECEMber 2009

Oregon Income / Franchise tax: Department explains effect of January 2010 ballot measures on 2009 legislation that increased corporate income tax rates & minimum taxes

Measures 66 and 67, Or. Dept. of Rev. (12/14/09). The department clarifies the impact of January 2010 ballot measures on legislation that was enacted during 2009 [H.B. 3405 and H.B. 2649], which included:
URL: http://www.oregon.gov/DOR/2010measures.shtml

- Replacing Oregon's $10 minimum tax with a sliding-scale minimum tax (based on Oregon sales) that ranges from $150 to $100,000,
- Adding new (higher) corporate income/excise tax brackets to Oregon's current 6.6% tax rate on corporate income, and
- Adding new (higher) personal income tax rates applicable to individuals earning over $125,000 per year.

Many of the changes in this legislation were supposed to effective for tax years beginning on or after January 1, 2009.

The department now explains that this legislation has since been referred for a vote in a January 26, 2010 special election.

The department states that if the ballot measures pass in this special election, the applicable taxes will increase retroactively beginning in 2009. Accordingly, these law changes could affect 2009 tax returns due on April 15, 2010. Therefore, to avoid errors and "unnecessary delays," the department recommends that taxpayers wait to file their respective 2009 tax returns until the election results are known (around February 1, 2010), as the department will not begin processing these returns until the results are known.