Form Or-19 - Pass-Through Entity Withholding (Page 2 of 4) in pdf

Oregon-source distributive income

Credits

Credits normally allowed on owners’ tax returns, such as the

For withholding purposes, distributive income is the net

credit for taxes paid to another state, are not taken into account

amount of income, gain, deduction, or loss of a pass-through

for this purpose.

entity for the tax year. It includes items directly related to the

PTE that are considered in determining the federal taxable

income of the nonresident owner. It also includes modifica-

Form TPV-19 tax payment

tions provided in ORS Chapter 316 and other Oregon laws

instructions (withholding)

that directly relate to the PTE.

Examples of the modifications allowed that relate to the

Calculate the amount of tax to be withheld and remitted to

PTE’s income include adjustments for depreciation, deple-

the department as follows:

tion, gain or loss difference on the sale of depreciable prop-

erty, U.S. government interest, and any modification for

• Individual owners: Use the highest individual tax rate on

federal targeted jobs tax credit. Modifications do not include

the nonelecting owner’s share of Oregon-source distribu-

the federal tax subtraction, itemized deductions, and the

tive income.

Oregon standard deduction.

• C corporation owners: See the corporate estimated pay-

Oregon-source distributive income does not include return of

ment instructions.

capital, income sourced in another state, or other distributions

not taxable by Oregon. Oregon-source distributive income is

Payments must be made in the nonelecting owner’s name

the portion of the entity’s modified distributive income that

as it will be shown on their individual or corporate income

is derived from or connected with Oregon sources.

or excise tax return.

If the PTE has business activity only in Oregon, multiply the

Remember: Disregard grantor trusts and single member

distributive income of the PTE by the ownership percentage

LLCs owned by individuals or corporations. Use the indi-

of the nonresident owner.

vidual’s name and SSN or the corporation’s name and EIN,

Apportionable income

not the disregarded entity.

The tax payment must be accompanied by Form TPV-19 for

PTEs with business activity both inside and outside Oregon

during the year must calculate Oregon-source distributive

each taxpayer. On the voucher, identify the date the payment

income for nonresident owners. Fill out Schedule AP-1 to figure

is being made and the type of taxpayer.

the apportionment percentage. Fill out Schedule AP-2 using the

PTE’s modified distributive income to apportion the income

Tax payments on behalf of 20 or more

between Oregon and other states.

nonelecting owners

Multiply line 11 on the Schedule AP-2 by the ownership

percentage of each nonresident owner to get their share of

If a PTE has 20 or more nonelecting owners, the PTE may

Oregon-source distributive income. Enter this amount in box

choose to file a schedule listing all nonelecting owners instead

2 of Part C, Form OR-19.

of using Form TPV-19. The PTE should complete a schedule

Guaranteed payments

that contains the following information in an 8-point font

size or larger:

Guaranteed payments are treated as a business income

• For the PTE that is filing the report, provide:

component of the PTE’s distributive income and attributed

directly to the owner receiving the payment. See Oregon

—Name of PTE, address, FEIN/BIN, and the PTE’s year

Administrative Rule (OAR) 150-316.124(2).

end;

Deductions

—Contact name and telephone number for payment

questions;

Individual tax deduction

—Date of payment; and

Deductions normally allowed to individuals (itemized deduc-

• For each nonelecting owner, provide:

tions or the standard deduction) are not allowed.

—Name, address, SSN/FEIN/BIN, subject income, total

Self-employment tax deduction

withholding, and identify type of entity (individual,

Each PTE must calculate the self-employment tax deduction

corporation, or trust). If ownership is joint, provide this

for each electing member that is subject to self-employment

information for both spouses. Also, identify the date the

tax. The self-employment tax deduction that is attributable to

payment was made on the schedule.

the Oregon-source distributive income is subtracted from the

Send a single tax payment for all owners with the completed

Oregon-source distributive income to determine the amount

upon which withholding is based.

schedule. See page 3 for a schedule example.

150-101-182 (Rev. 09-09)

Form Or-19 - Pass-Through Entity Withholding Page 2

Related Articles

Related forms

Related Categories