Form 40p Instructions - Oregon Department Of Revenue (Page 4 of 10) in pdf

For the portion of the year that you were a nonresident,

the subtraction in the space on the form. If you have

you may deduct a percentage of the alimony you paid.

more than one, show the type and amount of each sub-

The alimony must be taxable income to your former

traction. Fill in the total amount of “Other subtractions”

spouse. Figure your allowable Oregon deduction by com-

on line 38.

puting a special Oregon percentage on a separate sheet

• Federal pension income. You may be able to sub-

of paper as follows:

tract some or all of your pension income. This includes

1. Divide Oregon source income from when you were

benefits paid to the retiree or to the surviving spouse.

a nonresident by your total income while you were

The subtraction amount is based on the number of

a nonresident,

months of federal service before and after October 1,

2. Multiply this percentage by the alimony you paid

1991. Subtract your entire federal pension if all your

while you were a nonresident, and

months of federal service occurred before October 1,

3. Add the amount computed while you were a nonresi-

1991. If you have no months of service before Octo-

dent and the amount paid while you were a resident.

ber 1, 1991, you cannot subtract any federal pension.

Enter this amount on line 28 in the Oregon column.

If your service was both before and after October 1,

1991, you will subtract a percentage of your pension

Additions

income. Once you have determined the percentage,

it will not change from year to year.

Oregon treats these items differently than the federal

Example: Joe began working for the U.S. Postal Ser-

government.

vice February 5, 1965 and retired November 16, 1995.

Interest and dividends on government bonds

He worked 320 months before October 1, 1991 and a

of states other than Oregon.

total of 370 months. Joe moved to Oregon May 31,

1998. He can subtract 86.5 percent (320 ÷ 370) of his

Federal column. If you didn’t include interest or dividends

federal pension included in the Oregon column. He

in your federal income, fill in the amount you received from

will continue to subtract 86.5 percent of his federal

state and local governments outside of Oregon.

pension from Oregon income in future years.

Oregon column. Fill in the amount of interest and divi-

Use the following worksheet to determine your sub-

dends you got from states and local governments out-

traction amount:

side of Oregon while you were an Oregon resident.

1. Federal pension included in

1. __________

Federal election on interest and dividends

Oregon column.

of a minor child. Did you make the election

2. Divide months of service before 2. __________

to report the interest and dividends of your minor child

October 1, 1991 by total months

on your federal return? If so, see instructions on page 15.

of service.

3. Multiply line 1 by line 2. Enter

3. __________

Other additions. You may qualify for one or

here and on Form 40P, lines 38a

more other additions explained below. Identify

and 38b.

the addition in the space on the form. If you have more

• Difference in depreciation for Oregon. Are you

than one, show the type and amount of each addition.

Fill in the total amount of “Other additions” on line 33.

moving into Oregon with depreciable property located

in another state? You may need the “Oregon Depre-

Difference in depreciation for Oregon. Are you mov-

ciation Schedule.” See page 36 to order the form.

ing into Oregon with depreciable property located in

another state? You may need the “Oregon Depreciation

• Military active duty pay. Military active duty pay

Schedule.” See page 36 to order the form.

qualifies for a subtraction. See page 16 of the Form 40N

instructions.

There are also additions which apply to only a few

people. They are listed on page 15 of the 40N instructions.

• Interest and dividends from the U.S. government.

Make the addition in both the federal and Oregon col-

If you received interest and dividends from the U.S.

umns. If you need help, see page 36 for taxpayer assis-

government that you included on your federal return,

tance information.

see page 16 of the Form 40N instructions.

• Local government bond interest.

Subtractions

Federal column. The U.S. government taxes certain

Oregon treats these items differently than the federal

types of local government bond interest (e.g., private

government.

activity bonds). If you included income from Oregon

bonds on your federal return, deduct it on this line.

Subtract Social Security and Tier 1 Railroad retire-

Label it “Local government bond interest.”

ment benefits only if you included them on line 19.

Oregon column. Fill in Oregon local government

Other subtractions. You may qualify for one or

bond interest if you included it in Oregon income on

more other subtractions explained below. Identify

line 9.

Additions to income/25

Form 40p Instructions - Oregon Department Of Revenue Page 4

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