Oregon Statutes - Chapter 316 - Personal Income Tax - Section 316.778 - Small city business development exemption; rules.

(1) For each tax year in which a business firm receives an annual certification under ORS 285C.506, the income of the taxpayer apportionable to the certified facility of the business firm shall be exempt from tax under this chapter.

(2) The income of a resident taxpayer that is exempt under this section shall be determined by:

(a) Multiplying the federal taxable income of the taxpayer by the ratio of the taxpayerís federal adjusted gross income derived from the business firm over the taxpayerís federal adjusted gross income; and

(b) Multiplying the amount determined under paragraph (a) of this subsection by the ratio of the business firmís income derived from the firmís activities at the certified facility over the business firmís income from all business activities.

(3) The income of a nonresident or part-year resident taxpayer that is exempt under this section shall be determined by:

(a) Multiplying the Oregon-sourced federal taxable income of the taxpayer by the ratio of the taxpayerís federal adjusted gross income derived from the business firm over the taxpayerís federal adjusted gross income; and

(b) Multiplying the amount determined under paragraph (a) of this subsection by the ratio of the business firmís income derived from the firmís activities at the certified facility over the business firmís income from all business activities.

(4) The Department of Revenue shall by rule prescribe a method by which a business firm determines the extent to which the firmís income is derived from the firmís activities at the certified facility.

(5)(a) A partnership or S corporation shall report the information necessary to compute exempt income under this section to the firmís owners within 30 days following the issuance of the annual certification to the partnership or S corporation under ORS 285C.506.

(b) The department may permit extensions of time for reporting the information required under this subsection.

(6) As used in this section:

(a) ďBusiness firmĒ has the meaning given that term in ORS 285C.500.

(b) ďCertified facilityĒ means a facility, as defined in ORS 285C.500, for which an annual certification under ORS 285C.506 has been issued. [2001 c.944 §6]

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Last modified: August 7, 2008