Forms 40, 40s, And Instructions; Schedule Wfc And Instructions - 2006 Page 21
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312.
If your
And the number
Then your
Then add
+
4,116
filing
of boxes checked
standard
Their Oregon tax is
$ 6,411
status is…
in step 1 is…
deduction is…
Single
1
$3,040
Tax from farm income averaging or farm asset capital
2
4,240
gain method. If you qualify, you can compute your
Married filing
1
4,685
Oregon tax using one of the following methods:
2
5,685
jointly
Farm income averaging method. You can use the fed-
3
6,685
eral farm income averaging method even if you did not
4
7,685
use farm income averaging on your federal return.
Married filing
1
2,840
2
3,840
separately
Use Form FIA-40, Oregon Farm Income Averaging for
3
4,840
Full-Year Residents, to calculate tax on your farm income
4
5,840
and other Oregon income. Download the form from
Head of
1
4,165
our website or to order it, see page 40. Enter the tax
2
5,365
household
amount from Form FIA-40, line 22, on Form 40, line 29.
Qualifying
1
4,685
Check box 29b labeled “Form FIA-40.” Attach a copy of
widow(er)
2
5,685
Form FIA-40 to your return.
Fill in the total standard deduction on Form 40, line 26.
Farm asset capital gain method. Did you sell or
Standard deduction—Dependents. If someone else
exchange capital assets primarily used in farming
can claim you as a dependent, your standard deduc-
because you were getting out of a farming business?
tion is limited to the larger of:
Or, did you sell or exchange a farming partnership,
corporation, or other farming entity in which you held
• Your earned income plus $300, up to the maximum
at least a 10 percent ownership interest? If the sale or
allowed for your filing status, or
exchange was not to a family member and you were
• $850.
getting out of a farming business completely, you may
The limit applies even if you qualify but are not claimed
be eligible for a reduced tax rate on the net capital gain
as a dependent on another person’s return. See the stan-
from the proceeds.
dard deduction instructions for dependents on page 9.
Use Worksheet FCG, Farm Liquidation Long-Term Capital
Gain Tax Rate, to calculate tax on your net farm capital
Standard deduction —Nonresident aliens. The stan-
gain and other Oregon income. Download the work-
dard deduction for nonresident aliens (as defined by
sheet from our website or contact us to order it. Enter
federal law) is -0-.
the tax amount from Worksheet FCG, line 7, on Form
Total deductions. Enter the larger of line 25 or
27
40, line 29. Check box 29c labeled “Worksheet FCG.”
line 26.
Do not attach a copy of Worksheet FCG to your return.
Keep a copy with your records.
Oregon tax
Interest on certain installment sales. Do you
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have installment sales where you were required
Tax from tax tables or tax rate charts. Figure
29
to pay interest on the deferred tax liability for federal
the tax on your Oregon taxable income, line 28.
purposes? If so, you must also compute interest for
Go to the tax tables or rate charts on pages 21–23. Fill in
Oregon. The amount due for Oregon is computed the
your tax amount on line 29 and check box 29a. Please
same as the federal amount. The interest rate is 0.583
double-check that the tax you entered is correct.
percent per month (7 percent per year) for 2006. For
more information, please contact us.
Example 1: A single Oregon taxpayer has taxable
income of $19,500. The taxpayer will use column S on
page 22. The tax is $1,568.
Credits—Non-refundable
Example 2: A married couple has Oregon taxable
Most credits cannot be more than your Oregon tax lia-
income of $75,500. They are filing jointly. They will use
bility. Some credits have a carryforward provision that
the married filing jointly rate chart J on page 23. They
allows you to use the unused balance in the next year.
figure their tax like this:
Use credits that cannot be carried forward first.
Oregon taxable income
$75,500
Retirement income credit. If you were age 62
34
or older on December 31, 2006, and receiving
Subtract
–
50,000
retirement income, you may qualify for a retirement
25,500
income credit if:
Multiply by 9%
×
.09
• Your household income is less than $22,500 ($45,000
2,295
if married filing jointly), and
Or, visit our website at
Form 40 line instructions
29
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