Or. Admin. R. 150-317-0160

Current through Register Vol. 63, No. 6, June 1, 2024

Section 150-317-0160 - Exemption and Return Requirements

(1) For taxable years beginning on or after January 1, 1987, corporations exempt for federal tax purposes, will no longer need to submit an affidavit or a federal determination letter to the department as previously required. This does not, however, preclude the department from requesting information regarding the activities or other information from the exempt corporation.

(2) In order to establish its exemption and thus be relieved of the duty of filing returns and paying taxes, each organization claiming exemption for Oregon purposes but which is not exempt for federal purposes must file with the department:

(a) An affidavit showing the character of the organization, the purpose for which it was organized, its actual activities, the sources and the disposition of its income, whether or not any of its income is credited to surplus or may inure to the benefit of any private stockholder or individual (see below), and in general all other facts relating to its operations which affect its right to exemption;

(b) A copy of the articles of association or incorporation;

(c) The by-laws of the organization; and

(d) The latest financial statement showing the assets, liabilities, receipts and disbursements of the organization. The articles should clearly indicate the disposition to be made of surpluses in the event of termination.

(3) When an organization has established its right to exemption and does not have unrelated business taxable income, it need not thereafter voluntarily make a return or any further showing with respect to its status unless it changes the character of its organization or operations from the purpose for which it is organized, or unless the department requests the filing of returns or the furnishing of other information.

(4) As provided in ORS 317.920, a corporation otherwise exempt from tax shall be subject to Oregon Corporation Excise Tax on its unrelated business taxable income, and shall file a return in any tax year the corporation has unrelated business taxable income.

(5) Organizations exempt under federal law, but not exempt under Oregon law, must attach a copy of the organization's federal Form 990 or 990T to the Oregon return in lieu of a federal Form 1120.

(6) Organizations which devote a substantial amount of their time or funds to promote legislation or support political candidates are not exempt within any section of ORS 317.080.

(7) The exempt status granted to organizations by the Internal Revenue Service (IRS) or the department may be reviewed at a later date. If the department finds that the exempt status was granted in error due to misstatements or fraud in the application for exemption, or a mistake on a point of law by an employee of the department or the IRS, the exemption will be retroactively revoked to the date the exemption was granted. If the department finds that the exemption was justified when granted, but that subsequent activities disqualified the organization for the exemption, the exemption shall be revoked as of the date such disqualifying activities began.

(8) If an organization's exemption is revoked by the IRS, the department shall revoke the exemption for Oregon tax purposes with the same effective date as the IRS.

Or. Admin. R. 150-317-0160

1953; 6-68;12-19-75; 12-31-82; RD 15-1987, f. 12-10-87, cert. ef. 12-31-87; RD 11-1988, f. 12-19-88, cert. ef. 12-31-88; RD 7-1989, f. 12-18-89, cert. ef. 12-31-89; Renumbered from 150-317.080, REV 67-2016, f. 8-15-16, cert. ef. 9/1/2016

Stat. Auth.: ORS 305.100

Stats. Implemented: ORS 317.080