Instructions For Form 20-I - Oregon Corporation Income Tax

Note: If a deficiency is assessed against any taxpayer

Oregon, or a foreign country. Oregon’s definition of a for-

because of a retroactive adoption of federal law changes,

eign LLC includes an unincorporated association orga-

we’ll cancel any penalty or interest pertaining to these

nized under the laws of a federally recognized American

changes. If a taxpayer files an amended return showing

Indian tribe, no matter when organized.

a refund due based on the retroactive adoption of federal

Political organizations

law changes, we won’t pay interest.

Political organizations (for example, campaign commit-

Special filing requirements

tees and political parties) normally don’t pay state or

federal taxes. However, income earned from investments

See Oregon 2014 Corporation Excise Tax Form 20 Instruc-

is taxable. Examples include interest earned on deposits,

tions, 150-102-020-1, for filing information for the follow-

dividends from contributed stock, rents or royalties, and

ing entity types:

gains from the sale of contributed property. We follow

• Agricultural or horticultural cooperatives.

the federal definitions of a political organizations and

• Exempt organizations.

taxable income.

• Homeowners associations.

• IC-DISCs.

A political organization that isn’t incorporated and hasn’t

• Interstate broadcasters.

elected to be taxed as a corporation should file a personal

(These entities don’t file Form 20-I.)

income tax return. [ORS 316.277(2)]

Limited liability companies (LLCs)

For more information, including how to file your

return,

for

“Political

Organizations”

Oregon follows federal law in determining how an LLC

is taxed. Federal law doesn’t recognize an LLC as a clas-

sification for federal tax purposes. An LLC business

Publicly traded partnerships

entity must file a corporation, partnership or sole pro-

A “publicly traded partnership” is a partnership treated

prietorship tax return, depending on elections made by

the LLC and the number of members. An LLC is always

as a corporation for federal tax purposes under IRC

classified under federal law as one of these types of tax-

§7704.

able entities.

The partners in a publicly traded partnership aren’t

A multi-member LLC can be either a partnership or a

subject to tax on their distributive shares of partnership

corporation, including an S corporation. A single mem-

income. A publicly traded partnership taxed as a corpo-

ber LLC (SMLLC) can be either a corporation or a single

ration must file a Form 20 if doing business in Oregon,

member “disregarded entity.” Refer to federal law for

or Form 20-I if not doing business in Oregon, but the

more information and requirements.

publicly traded partnership is receiving Oregon-source

An LLC taxed as a C corporation must file Form 20 if

income.

doing business in Oregon, or Form 20-I if not doing busi-

Real Estate Mortgage Investment Conduits

ness in Oregon but the LLC is receiving Oregon-source

(REMICs)

income. The LLC must file Form 20-S if the entity files

federal Form 1120-S.

A REMIC isn’t subject to Oregon tax; the income is tax-

An LLC taxed as a partnership must file Form 65, Ore-

able to the holders of the REMIC’s interests under ORS

gon Partnership Return, 150-101-065, if doing business in

chapter 316, 317, or 318, whichever is applicable. A REMIC

Oregon, or if receiving income from an Oregon source,

must file Form 20-I if it gets prohibited transaction

or if it has any Oregon resident members. If the LLC has

income from Oregon sources or has any resident holders

a corporate member, the member is taxed on its share of

of a residual interest. Income is from an Oregon source

the LLC’s Oregon income.

if it comes from tangible property located in Oregon or

If an LLC is part of a corporation’s overall business oper-

from intangible property used in Oregon.

ations and is treated as a partnership, include the corpo-

ration’s ownership share of LLC property, payroll, and

All REMICs required to file must file Form 20-I and

sales in the apportionment percentage calculation on

attach a complete copy of federal Form 1066. The REMIC

Schedule AP, Apportionment of Income for Corporations and

must also attach a federal Schedule Q for each residual

Partnerships, 150-102-171. (OAR 150-314.650)

interest holder for each quarter of the tax year. Enter the

amount of net income from prohibited transactions from

Foreign LLCs are identified as unincorporated asso-

ciations organized under the laws of a state other than

federal Form 1066 Schedule J. (ORS 314.260)

150-102-021-1 (Rev. 10-14)

Form 20-I Instructions

Instructions For Form 20-I - Oregon Corporation Income Tax - 2014 Page 6

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