Or. Admin. Code § 150-305-0030

Current through Register Vol. 63, No. 12, December 1, 2024

Section 150-305-0030 - Declaratory Rulings

(1) Applicability of this rule. The provisions set forth in this rule shall apply to declaratory ruling requests with respect to the validity or applicability of:

(a) Tax and revenue laws of the State of Oregon to any person, property or state of facts.

(b) Any Department of Revenue administrative rule to any person, property or state of facts.

(2) Definitions for purposes of this rule.

(a) Declaratory Ruling. A declaratory ruling is an advisory opinion or order issued by the department specifying how a tax and revenue law of the State of Oregon or an administrative rule promulgated by the department is to be applied to any person, property or state of facts.

(b) Person. The term person includes an individual, a county assessor or tax collector, trust, estate, partnership, association, joint stock company, corporation, syndicate, group, pool, joint venture, or other unincorporated organization or group. Such term also includes a guardian, trustee, executor, administrator, trustee in bankruptcy, receiver, conservator, or any person acting in a fiduciary capacity.

(3) General practice. Upon petition by an interested person, the department has discretionary authority to issue declaratory rulings. This discretion shall be exercised in the light of all relevant circumstances, including the business or other reasons motivating the transaction, and with a view to issuing rulings only to the extent consistent with the proper administration of the tax laws.

(4) Examples of situations in which declaratory rulings shall not be issued. Generally, the department shall not issue declaratory rulings if:

(a) At the time the ruling is requested the identical issue is involved in a person's return for an earlier tax year and:

(A) That issue is being examined by the department or the courts;

(B) That issue has already been examined by the department and an opinion and order has been issued;

(C) That issue has been examined by the department and the statutory period of limitation for appealing the department's determination has not expired; or

(D) That issue has already been examined by the Oregon Tax Court and a decision has been issued.

(b) The person is considering alternative plans of proposed transactions or is requesting a ruling on a hypothetical situation.

(c) The administrative rule being considered is scheduled for amendment as it relates to the issue involved or, the legislature is considering, or has adopted, legislation which will necessitate revision to the rule as it applies to the tax year involved.

(d) The transaction to be ruled on will not be entered into until some indefinite future time.

(e) The legislature is considering a revision to the statute as it applies to the tax year involved.

(5) Instructions to person requesting a ruling.

(a) A request for a declaratory ruling shall be accompanied by a declaration in the following form: "Under penalties for false swearing, I declare that I have examined this request, including accompanying documents, and to the best of my knowledge and belief, the facts presented in support of the requested declaratory ruling are true, correct, and complete." The declaration shall be signed by the person or persons on whose behalf the request is made or by their representative. The person who signs for a corporation shall be an officer of the corporation, an authorized employee or an authorized representative of the corporation regularly employed by the corporation in tax matters who has personal knowledge of the facts. The officer or employee shall be one whose duties are not limited to obtaining a ruling from the department. The person signing for a trust, estate, or partnership shall be a fiduciary or partner who has personal knowledge of the facts.

(b) Each request for a declaratory ruling shall contain a complete statement of all of the facts relating to the transaction. Such facts include: names, addresses, telephone numbers, and personal identification numbers of all interested parties; a full and precise statement of the reasons for the transaction, and a carefully detailed description of the transaction. (The term "all interested parties" does not mean that a list is required of all shareholders of a widely-held corporation requesting a declaratory ruling or a list of employees where a larger number may be involved.) If the request deals with only one step of a larger integrated transaction, the facts, circumstances, etc. relating to the entire transaction must be submitted. In addition, true copies of all contracts, wills, deeds, agreements, instruments, and other documents in the transaction shall be submitted with the request. Original documents, such as contracts, wills, etc., should not be submitted because they become part of the department's file and will not be returned. All material facts and documents shall be included in the taxpayer's letter requesting a ruling or in supplemental letters, or attached to the letter. Material facts furnished to the department orally shall be promptly confirmed by letter to the department with a declaration in the form described in section (5)(a). This confirmation shall be furnished within 30 calendar days to be considered part of the request.

(c) The request shall contain a statement of whether, to the best of the knowledge of the person and the person's representative(s), if any, the identical issue is in a tax return of the person for an earlier tax year and, if so, whether the issue (1) is being examined by the department or (2) has been examined by the department and whether the statutory period of limitation for appealing the department's determination has expired. If, after the request is filed but before a declaratory ruling is issued, the person knows that an examination of the issue by the department has been started, the person shall notify the department of such action. If a return is filed before a ruling is received concerning the issue, a copy of the request shall be attached to the return. This alerts the department's processing center and avoids premature action on the issue.

(d) If the person advocates a particular conclusion, an explanation of the grounds for the assertion shall be furnished, together with a statement of relevant authorities in support of the person's views. The person is encouraged to inform the department and discuss the implications of any legislation, court decisions, or administrative rules that the person determines to be contrary to the position advanced. If the person determines that there are no contrary authorities, a statement to this effect would be helpful in the ruling request. Identification and discussion of contrary authorities will generally enable department personnel to arrive more quickly at a full understanding of the issue and the relevant authorities.

(e) A request for a declaratory ruling shall be sent to the Oregon Department of Revenue, Director's Office, Revenue Building, 955 Center St. N.E., Salem, OR 97301. The request shall clearly indicate what tax program is affected (i.e., personal income tax, corporate excise tax, property tax, timber tax, etc.).

(f) A person who wants to have a hearing on the issue or issues involved shall indicate this in writing when filing the request.

(6)

(a) If a request for a declaratory ruling does not comply with all the provisions of this administrative rule, the request shall be acknowledged, and the requirements that have not been met shall be pointed out. If a request for a ruling lacks essential information, the person shall be notified in writing that if the information is not received within 30 calendar days, the request shall be closed. After 30 days, a letter shall be sent by the department to inform the taxpayer that a declaratory ruling will not be issued. If the information is received after the request is closed, it shall be reopened and treated as a new request as of the date the essential information is received.

(b) The department shall process requests for declaratory rulings as expeditiously as possible. Although consideration shall be given to requests for processing by a specified time, the department cannot give assurance that any ruling will be processed by the time requested.

(c) A person may obtain information regarding the status of a request by calling the department representative whose name and telephone number is shown on the acknowledgement of receipt of the request.

(d) A person who receives a declaratory ruling before filing a return about any transaction that has been consummated and that is relevant to the return being filed shall attach a copy of the ruling to the return when it is filed.

(7) Effect of declaratory rulings.

(a) A declaratory ruling issued by the department pertains only to the person, property or state of facts presented in the ruling request and is binding on the department and the requestor with respect to those facts. The ruling is not binding on the department if the facts and circumstances which the ruling addresses are different when the department is auditing a transaction once it has occurred.

(b) A change in the applicable statutory law or an amendment of administrative rules has the effect of an automatic revocation of a declaratory ruling to the extent that the declaratory ruling is inconsistent with the amended statute or administrative rule. The director may also revoke or modify a declaratory ruling by direct letter to the taxpayer.

(c) A person shall not rely on a ruling issued to another person unless that person has substantially identical facts or property as the person who received the prior declaratory ruling. If the person knows of a ruling issued to another person on a similar state of facts, such information shall be included in the declaratory ruling request. The department may use the prior declaratory ruling as a guide in issuing a subsequent declaratory ruling on a similar state of facts unless the circumstances explained at section (4)(c) of this rule exist.

(8)

(a) Hearings. A person may request a department hearing on all issues to be addressed by a declaratory ruling. The request must be in writing. If tentative findings have been made by the director or the director's agents prior to the hearing, they will be made available to the petitioner for use at the hearing. At least 30 days before the declaratory ruling hearing, parties to the hearing shall be given written notice of the procedures to be followed in the hearing. The hearing procedures shall be those which the department determines are best suited for the particular issues to be decided.

(b) Oregon Tax Court. A person may appeal a declaratory ruling issued by the department in the Oregon Tax Court and Oregon Supreme Court in the manner provided by ORS 305.445.

(9) Oral advice to persons.

(a) The department shall not issue declaratory rulings from oral requests. The request must be in writing and contain the information required in Section (5). However, representatives of the department ordinarily will discuss with taxpayers or their representatives, inquiries regarding: substantive tax issues; whether the department will issue rulings on particular issues and questions relating to procedural matters about submitting ruling requests. Any discussion of substantive issues shall be at the discretion of the department and shall not be binding on the department.

(b) Oral advice from the department is advisory only and the department is not bound to recognize it in the examination of the person's return.

Or. Admin. Code § 150-305-0030

1-64; 12-31-77; RD 7-1989, f. 12-18-89, cert. ef. 12-31-89; RD 1-1997(Temp), f. 6-13-97, cert. ef. 7-4-97 thru 12-31-97; RD 5-1997, f. 12-12-97, cert. ef. 12-31-97; REV 13-1999, f. 12-30-99, cert. ef. 12-31-99; REV 8-2000, f. & cert. ef. 8-3-00; Renumbered from 150-305.105, REV 48-2016, f. 8-13-16, cert. ef. 9/1/2016

Stat. Auth.: ORS 305.100

Stats. Implemented: ORS 305.105