[Revenews] Form OR-STI: Verify Before You File

[SAKOFF Sophia * DOR]

Form OR-STI is the new Oregon Statewide Transit Individual Tax Return for taxpayers who are required to report and pay because their out-of-state employer did not withhold the statewide transit tax (STT) from their wages. Even though tax season just started on January 28th, we are already seeing some common mistakes:

*        Taxpayers who work only in Oregon do not need to file Form OR-STI. This is true even if the employee's Form W-2 does not report STT withholding. Electronic returns that do not report payments on line 4, tax due on line 8, or a refund on line 9 (i.e. a "Zero Return") will be rejected.

*        STT withheld by an employer should be reported on line 3, not line 4. 100% of the returns we have reviewed so far have this mistake. This could potentially cause your clients to receive a bill from us because we have no record of a "payment" on their account.
Oregon employers, and employers doing business in Oregon, are required to withhold STT from their employee's wages at the time wages are paid. Only employees who work for an out-of-state employer who doesn't withhold STT as a courtesy need to file Form OR-STI to report and pay tax due. Oregon nonresidents who work both inside and outside of Oregon for the same employer may choose to file Form OR-STI to claim a refund.
Tax professionals should review the instructions for Form OR-STI before submitting a return to ensure the taxpayer has a filing requirement. Instructions are available at www.oregon.gov/dor/forms<http://www.oregon.gov/dor/forms>. If your client does have a filing requirement, review Form OR-STI before submitting to verify amounts are reported on the correct lines.
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