(1) Subject to subsection (2) of this section, if the Internal Revenue Code requires or permits an election or revocation to be made by an S corporation, then that election or revocation shall apply for Oregon tax purposes. If the Internal Revenue Code requires or permits an election or revocation to be made by a shareholder or shareholders of an S corporation, then that election or revocation shall apply for Oregon tax purposes.
(2) The Department of Revenue may adopt rules that contravene subsection (1) of this section if the election or revocation does not carry out the purposes of this chapter and ORS chapter 305, 316, 317 or 318. [1989 c.625 §48]
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