[Revenews] Oregon Cultural Trust

[BALL Shannon * DOR]

2016 Oregon Cultural Trust Changes

Beginning with tax year 2016, the Oregon Cultural Trust add back (OR-ASC code 143) is no longer available.  Based on a revised interpretation of the statute (ORS 315.675(7)), the credit is allowed in addition to any charitable deduction that is claimed on the Schedule A.  The statute does not state that an addback is required when a deduction is claimed on the federal return for the same contribution that qualified for the Oregon credit as is stated in other similar Oregon credit statutes.

For Oregon purposes, if a taxpayer makes a matching donation to the Trust for Cultural Development Account and claims that amount as both a charitable contribution on the Schedule A and a credit on the Oregon return, no addback is required even though this creates a double benefit.  However, what is allowed to be claimed on the Schedule A is federal tax law, and the IRS has yet to make a determination on whether or not a donation in exchange for a state credit is considered a charitable deduction.

Question:  Can you amend prior year returns to remove the addback?
Answer:  Yes, you can amend prior Oregon returns that are still open under the statute of limitations to remove the add-back code (code 143).

Question:  Does this interpretation affect all state credits or just the Oregon Cultural Trust?
Answer:  This only impacts the credit for Oregon Cultural Trust donations.  ORS 315.675 is different from the other credit statutes as it does not require an addition.

We realize this is a change to what has been communicated to you about the Oregon Cultural Trust credit in the past and we apologize for any confusion it has caused.


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