Forms 40, 40s, And Instructions; Schedule Wfc And Instructions - 2006 Page 18
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31Keogh distributions. Do not include interest on fed-
total of 403 months; 244 months were worked before
October 1, 1991. In 2006, she received taxable federal
eral tax refunds in the subtraction.
pension income of $35,000. Using the formula above,
Examples:
her allowable subtraction is:
• You can subtract interest from U.S. Series EE, I, or
244
HH bonds and Treasury bills or notes.
× $35,000 = $21,175
403
• You can subtract interest and dividends paid to you
by organizations that invest in U.S. government
She can subtract 60.5 percent (244 ÷ 403 = .6054), or
securities. The payer may have given the percent-
$21,175 ($35,000 × .605), of her taxable federal pen-
sion. She will continue to subtract 60.5 percent from
age of interest and dividends from U.S. government
securities on your Form 1099. Download the publi-
Oregon income in future years.
cation Interest and Dividends on U.S. Bonds and Notes
Other subtractions. You may qualify for one
18
from our website or contact us to order it.
or more other subtractions explained below.
Please identify the subtraction(s) using the numeric
• If you reported interest or dividends of your minor
code shown in brackets. Enter the numeric code on
child on your federal return, you can subtract any
line 18a and the amount on line 18b. For example, if
U.S. government interest included.
you’re claiming a $100 Oregon Lottery subtraction,
• You must reduce U.S. government interest and
enter “322” on line 18a and “$100” on line 18b. If you’re
dividends by any interest expense relating to U.S.
claiming two subtractions, enter the second numeric
government obligations deducted on your federal
code on line 18c and the amount on line 18d. Fill in the
Schedule A.
total amount of other subtractions on line 18.
Note: When you sell or dispose of a U.S. government
If you’re claiming more than three “other subtractions,”
obligation, you must include any gain or loss in Ore-
attach a statement to your return with the numeric
gon income.
codes and amounts of the subtractions that don’t fit on
the return. Add lines 18b, 18d, 18f, and the subtraction
Federal pension income. You may be able to
17
amounts on the statement and enter the total on line
subtract some or all of your taxable federal pen-
18. Number the statement. On line 19 (total subtrac-
sion included in 2006 federal income. This includes
tions), write “See Stmt” and the statement number in
benefits paid to the retiree or the beneficiary. The sub-
the space next to the total subtractions. Example: Write
traction amount is based on the number of months of
“See Stmt 3” for statement number 3. Do not use this
federal service before and after October 1, 1991:
line to subtract federal pension (use line 17 instead).
• If all your months of federal service were before
For more information, go to our website or contact us.
October 1, 1991, subtract 100 percent of the taxable
• 529 Oregon College Savings Plan [code 324]. You
amount of federal pension income you reported on
can subtract up to $2,000 ($1,000 if married filing
your federal return.
separately) of contributions made to a 529 Oregon
• If you have no months of service before October 1,
College Savings Network account in 2006. If you
1991, you cannot subtract any federal pension.
contribute more than $2,000, you can carry forward
the remaining contribution not subtracted over the
• If your service was both before and after October
next four years. Keep a copy of your account state-
1, 1991, subtract a percentage of the taxable federal
ment with your tax records. For more information,
pension income you reported on your federal return.
go to , or contact us.
To determine your percentage, divide the months of
service before October 1, 1991, by the total months of
• American Indian [code 300]. Are you an enrolled
service. Round to three places (example: .4576 = 45.8
member of a federally recognized American Indian
percent). Once you’ve determined the percentage, it
tribe? You may be able to subtract all or part of your
will remain the same each year. Write the percent-
income if all of the following are true:
age on line 17a. If you have two federal pensions,
— You are an enrolled member of a federally recog-
write the second percentage on line 17b and enter
nized American Indian tribe, and
your total subtraction amount on line 17. Figure the
— Your income was from sources within federally
percentage for each pension separately.
recognized Indian country in Oregon, and
— You lived in federally recognized Indian country
Federal pension subtraction formula:
in Oregon when the income was earned.
Months of service
Federal pension
before 10/1/91
Oregon
You must attach a completed copy of your Exempt
×
amount included
=
subtraction
Total months
Income Schedule for Enrolled Members of a Federally Rec-
in federal income
of service
ognized American Indian Tribe to your return. Down-
Example: Ann worked for the U.S. Forest Service
load the schedule from our website or contact us to
from May 27, 1971, until January 7, 2005. She worked a
order it.
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Form 40 line instructions
Have questions? Need forms? See page 40.
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