From steve.purkeypile at dor.state.or.us Thu Jan 6 11:22:21 2011 From: steve.purkeypile at dor.state.or.us (PURKEYPILE Steve) Date: Thu, 6 Jan 2011 19:22:21 +0000 Subject: [Revenews] 2010 Connection Issues Message-ID: For tax year 2010, Oregon is tied to the definition of federal taxable income as of December 31, 2009. Couple that with a very busy Congressional session in 2010 and we've got a great deal of uncertainly when it comes to filing the 2010 Oregon tax return. We know that the upcoming 2011 legislature will consider reconnect bills but given the state's challenging budget situation, there is no way to predict what a final bill may look like. At this time, if your client is affected by any of the issues listed below, there are two options: Option 1: Delay the filing of the tax return until the legislature indicates its policy preference in this area. This does not necessarily mean that you have to wait to file until the legislature has adjourned. We hope the legislature will act quickly to resolve this issue early on in the session. Option 2: Go ahead and file under current law. If you choose this option, an add back on the Oregon return will be required in some situations. Below is a list of what codes to use when adding back items for Oregon purposes. We will keep you updated via this listserve and our website of any developments. (Note: For tax year 2011, current law provides for the rolling reconnect to resume, but this is also subject to change in the 2011 session.) 100% expensing of equipment and machinery by businesses - this provision is effective for items placed in service after September 8, 2010. Prior law (which Oregon is also not connected to) allowed 50% expensing for items placed in service in 2010. Current Oregon law allows for up to $134,000 in expensing up to a ceiling of $530,000. The difference between the amount allowed under federal law and Oregon law must be added back using addition code 101. Tax Extenders extended for two more years - this provision extends expired (or expiring) tax deductions for two more years (2010 and 2011). Under current Oregon law, these tax deductions have expired for 2010 and, if taken on the federal return, must be added back to the Oregon return using addition codes listed below. The provisions are: * Tax free distributions from IRAs for charitable purposes (use addition code 131) * Contribution of capital gain real property for conservation purposes (use addition code 131) * The $250 above-the-line deduction for educators who purchase items for their classrooms or students (use addition code 132) * The option to deduct state and local sales tax in lieu of income tax (this should reduce federal itemized deductions by using line 24, as usual) * The tuition and fees above-the-line deduction (Note: For 2010, a subtraction is currently not allowed on the Oregon return when a taxpayer elects a federal education credit in lieu of the tuition and fees deduction) (use addition code 132) Self-Employment tax deduction for health insurance - this provision allows business owners to deduct health insurance costs incurred in 2010 for themselves and their family members in calculating their 2010 self-employment tax. When taxpayers proceed to take the above-the-line deduction of ? of their self-employment tax they will be receiving less of a deduction than they would be allowed under current Oregon law. Taxpayers should use code 346 to take a subtraction for the difference between ? of the self-employment tax deduction (Form 1040, line 27) calculated with the health insurance deduction and without. Imputed income for health coverage provided to certain adult children - this provision of the health reform law extends the tax exemption for health insurance coverage provided to adult children by their parent's employer for those who are age 19-26 (keeping in mind that previous law provided for an exemption for adult children through age 23 if they are also a student - this is still the case). The fair market value of the cost of health insurance is imputed income and is taxable to Oregon*. Keep in mind that the cost of the coverage is figured as if the insurance were purchased in an arm's length transaction and not what the employer may actually be paying. Taxpayers should use addition code 133 to report this imputed income on the Oregon return. (*Note that this provision only pertains to tax year 2010. Current law provides that we return to a rolling reconnect beginning in tax year 2011.) Please continue to keep an eye out for future listserve posts or check the practitioner page of our webpage for more information in the weeks ahead. Questions? Do not reply to this email. Email your questions to prac.revenue at state.or.us. Steve Purkeypile Personal Income Tax Policy Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From mark.k.ruth at dor.state.or.us Wed Jan 12 15:44:58 2011 From: mark.k.ruth at dor.state.or.us (RUTH Mark K) Date: Wed, 12 Jan 2011 23:44:58 +0000 Subject: [Revenews] Oregon Personal Income Tax Electronic Filing to open January 18th Message-ID: <65A5912F539F864DB90806CFBAC2EDE80978DA4B66@MBX17.EXCHPROD.USA.NET> Good afternoon, The Oregon Department of Revenue plans to open our e-file systems on Tuesday morning January 18th. Assuming returns are available at the IRS we will then begin downloading, acknowledging, and preparing returns to send on through our processing system that morning. No Oregon acknowledgements will go out before the 18th. E-file System Questions? Email your question to Electronic.Filing at state.or.us Tax Year 2010 Federal Tie Issues? Keep an eye out for future listserve posts or check the practitioner page of our website for more information in the weeks ahead: http://www.oregon.gov/DOR/index.shmtl Mark K. Ruth PIT Electronic Filing Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From steve.purkeypile at dor.state.or.us Fri Jan 28 13:35:07 2011 From: steve.purkeypile at dor.state.or.us (PURKEYPILE Steve) Date: Fri, 28 Jan 2011 21:35:07 +0000 Subject: [Revenews] 2010/2011 Due Dates and reconnect Message-ID: Good afternoon - I have two things for you to check out on our website. First we have a 2010/2011 due date page that may be helpful with the celebration of DC Emancipation Day this year. Remember that calendar year corporate returns are due April 15 and almost everything else will be due April 18. http://www.oregon.gov/DOR/duedates.shtml Also, we have added information explaining the disconnect issues we have for the 2010 tax year. This is similar to information that has already been distributed to you in a prior Revenews posting. http://www.oregon.gov/DOR/PERTAX/federal-disconnect-2010.shtml Some related news - the House Revenue Committee has scheduled a hearing on a reconnect bill (HB 2535) for this Thursday. We'll keep you posted of any developments. Do not reply to this email. If you have questions, please email us at prac.revenue at state.or.us. If you want to cancel or modify your REVENEWS listserve subscription, please visit this webpage http://listsmart.osl.state.or.us/mailman/listinfo/revenews. Steve Purkeypile Personal Income Tax Policy Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From steve.purkeypile at dor.state.or.us Mon Jan 31 15:07:02 2011 From: steve.purkeypile at dor.state.or.us (PURKEYPILE Steve) Date: Mon, 31 Jan 2011 23:07:02 +0000 Subject: [Revenews] UPDATE-Oregon Personal Income Tax Electronic Filing to open on January 18th Message-ID: Good afternoon, We wanted to follow up on our January 12th season opening REVENEWS. We opened our Electronic filing system on January 18th as planned and have been downloading, acknowledging and preparing returns to send on through the processing system since that date. We have downloaded some 112,000 returns from the IRS since the 18th, and are in production with all Oregon return types. Download volume is only slightly behind last year at this time, likely due to the IRS extender delay. E-file System Questions? Email your questions to Electronic.Filing at state.or.us. Do not reply to this email. Mark K. Ruth PIT Electronic Filing Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From david.farr at dor.state.or.us Tue Feb 8 08:20:53 2011 From: david.farr at dor.state.or.us (FARR David) Date: Tue, 8 Feb 2011 16:20:53 +0000 Subject: [Revenews] Oregon inheritance tax and the Federal Tax Relief Act of 2010 Message-ID: Hello Tax Professionals, The recent Federal Tax Relief Act of 2010 allows an automatic extension to file and pay the federal estate tax to September 17, 2011, if the decedent's date of death is January 1, 2010, through December 17, 2010. The automatic federal extension does not change the requirements for filing or paying the Oregon Inheritance Tax. Oregon requires: (1) the Oregon inheritance tax return, Form IT-1, and inheritance tax payment received by the department nine months after the decedent's date of death (due date), or (2) a request for an extension to file the Oregon inheritance tax return, Form IT-1, and payment of the Oregon inheritance tax received by the department nine months after the decedent's date of death (due date), or (3) a request for an extension to file the Oregon inheritance tax return, Form IT-1, and request for extension of time to pay the Oregon inheritance tax received no later than nine months after the decedent's date of death (due date). Payment received after the original or Oregon approved extended payment due date will be subject to interest and penalty. Please visit our website at www.oregon.gov/DOR for more Oregon inheritance tax information. If you have other questions, email us at estate.help.dor at state.or.us, or call our taxpayer assistance at 503.378.4988, or call toll-free from an Oregon prefix 1.800.356.4222. Do not reply to this email, see the estate help email address above. To unsubscribe from Revenews, get a password reminder, or change your subscription options visit www.listsmart.osl.state.or.us/mailman/listinfo/revenews Estate Tax Unit Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From steve.purkeypile at dor.state.or.us Thu Feb 17 15:47:10 2011 From: steve.purkeypile at dor.state.or.us (PURKEYPILE Steve) Date: Thu, 17 Feb 2011 23:47:10 +0000 Subject: [Revenews] Update on 2010 reconnect bill Message-ID: Good afternoon, The legislature took the first step toward a 2010 tax year reconnect yesterday. SB 301 passed out of the Senate Finance and Revenue Committee unanimously yesterday afternoon. The bill, if passed into law, would connect the Oregon definition of taxable income to federal law with the exception of IRC Section 168 bonus depreciation and IRC Section 179 expensing provisions. Those provisions would still be tied to federal law as of December 31, 2009. Remember...this is just the first step. The bill now heads to the Senate floor and if it passes there, over to the House of Representatives and then the Governor. Stay tuned for further updates. If you would like to track the progress of this bill yourself, go to the legislature's bill status page and enter "SB 301". Here's the link: http://www.leg.state.or.us/searchmeas.html. Please do not reply to this email. To unsubscribe from Revenews, get a password reminder, or change your subscription options visit www.listsmart.osl.state.or.us/mailman/listinfo/revenews Steve Purkeypile Personal Income Tax Policy Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From steve.purkeypile at dor.state.or.us Thu Feb 17 16:07:53 2011 From: steve.purkeypile at dor.state.or.us (PURKEYPILE Steve) Date: Fri, 18 Feb 2011 00:07:53 +0000 Subject: [Revenews] Update on 2010 reconnect bill In-Reply-To: References: Message-ID: UPDATE: SB 301 passed the Senate this morning and now moves to the House. ________________________________ From: revenews-bounces at listsmart.osl.state.or.us [mailto:revenews-bounces at listsmart.osl.state.or.us] On Behalf Of PURKEYPILE Steve Sent: Thursday, February 17, 2011 3:47 PM To: revenews at listsmart.osl.state.or.us Subject: [Revenews] Update on 2010 reconnect bill Good afternoon, The legislature took the first step toward a 2010 tax year reconnect yesterday. SB 301 passed out of the Senate Finance and Revenue Committee unanimously yesterday afternoon. The bill, if passed into law, would connect the Oregon definition of taxable income to federal law with the exception of IRC Section 168 bonus depreciation and IRC Section 179 expensing provisions. Those provisions would still be tied to federal law as of December 31, 2009. Remember...this is just the first step. The bill now heads to the Senate floor and if it passes there, over to the House of Representatives and then the Governor. Stay tuned for further updates. If you would like to track the progress of this bill yourself, go to the legislature's bill status page and enter "SB 301". Here's the link: http://www.leg.state.or.us/searchmeas.html. Please do not reply to this email. To unsubscribe from Revenews, get a password reminder, or change your subscription options visit www.listsmart.osl.state.or.us/mailman/listinfo/revenews Steve Purkeypile Personal Income Tax Policy Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From steve.purkeypile at dor.state.or.us Tue Mar 8 13:55:08 2011 From: steve.purkeypile at dor.state.or.us (PURKEYPILE Steve) Date: Tue, 8 Mar 2011 21:55:08 +0000 Subject: [Revenews] Update on reconnect Message-ID: Today, the Senate passed SB 301. This follows yesterday's passage of the same bill in the House of Representatives. The bill now heads to the governor for his signature. For tax year 2010 - Proceed with filing returns! The bill reconnects Oregon to the federal definition of taxable income including all of the changes Congress made in 2010 with these significant exceptions: (1) Additional expensing allowed under IRC section 179 (Oregon's limit remains at $134,000 with a dollar for dollar reduction beginning at $530,000); and (2) Bonus depreciation allowed under IRC section 168(k). To reiterate, Oregon is connected to the following items for tax year 2010: * Tuition and fees deduction * Educator expenses deduction * Exemption of imputed income related to the extension of health insurance coverage provided to adult children (as allowed by the Affordable Care Act) * Modification of the calculation of the self-employment tax * Tax free distributions from IRAs for charitable purposes * Contribution of capital gain property for conservation purposes * Any amount excluded from income under section 2011 of the Small Business Jobs Act relating to the sale of small business stock * Additional start-up expenses deducted under section 2031 of the Small Business Jobs Act * Any other federal difference except those listed below Important! Remember that Oregon remains disconnected from (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)] Some 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 2011 - After some discussion and debate, the legislature has reinstated a full, rolling reconnect for tax year 2011 including the depreciation and expensing provisions. Please do not reply to this email. To unsubscribe from Revenews, get a password reminder, or change your subscription options visit www.listsmart.osl.state.or.us/mailman/listinfo/revenews Steve Purkeypile Personal Income Tax Policy Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From steve.purkeypile at dor.state.or.us Wed Mar 9 11:22:42 2011 From: steve.purkeypile at dor.state.or.us (PURKEYPILE Steve) Date: Wed, 9 Mar 2011 19:22:42 +0000 Subject: [Revenews] Update on reconnect - correction Message-ID: In yesterday's post regarding the update on reconnect, one of the frequently asked questions addressed what taxpayers (or practitioners) should do if they have already filed a 2010 return with an addback. Our answer to that question has been modified from yesterday's post as follows: 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? Updated Answer: If you filed the return before March 8, 2011 with an addback for either the tuition and fees or educator expenses deduction, the department will make the necessary corrections to the return for you. For all other addbacks, you will need to file an amended return removing the addition. Please do not reply to this email. To unsubscribe from Revenews, get a password reminder, or change your subscription options visit www.listsmart.osl.state.or.us/mailman/listinfo/revenews. Steve Purkeypile Personal Income Tax Policy Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From steve.purkeypile at dor.state.or.us Thu Mar 10 08:24:24 2011 From: steve.purkeypile at dor.state.or.us (PURKEYPILE Steve) Date: Thu, 10 Mar 2011 16:24:24 +0000 Subject: [Revenews] Update on reconnect - revision from yesterday Message-ID: Good morning. Unfortunately, I must rescind my posting yesterday in which I indicated that the department would correct returns where an addback was included for tuition and fees or educator expenses. We initially thought it was just a couple thousand returns but it turns out that it was about 10 times that amount. Simply put, the department does not have the resources to take on that work without severely impacting the current filing season. As a result, any 2010 returns that include an addback for any items we are now connected to need to be amended. I am truly sorry for the confusion. Thanks for your patience and understanding. Steve Purkeypile Personal Income Tax Policy Oregon Department of Revenue -------------- next part -------------- An HTML attachment was scrubbed... URL: From penny.s.raths at dor.state.or.us Thu Mar 10 15:09:36 2011 From: penny.s.raths at dor.state.or.us (RATHS Penny S) Date: Thu, 10 Mar 2011 23:09:36 +0000 Subject: [Revenews] TriMet and Lane Transit Districts adopt federal deduction for self-employed health insurance. Message-ID: Beginning tax year 2010, the IRS made changes to the Federal Schedule SE to allow a deduction from your net self-employed earnings for the self-employed health insurance you paid. The TriMet Transit District and the Lane Transit District have adopted this modification to your self-employed earnings. You will continue to use the amount on line 3 from your Federal Schedule SE in calculating both your TriMet Self-employed Transit Tax (Form TM) and your Lane Self-employed Transit Tax (Form LTD). Note: If your self-employed earnings after the deduction are $400 or less, you do not need to file a Transit Self-employed tax return. If you have questions please email us at: TSE.Help.DOR at state.or.us -------------- next part -------------- An HTML attachment was scrubbed... URL: