Form Or-18 - Report Of Tax Payments On Real Property Conveyances Page 2
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6determine if the entity is disregarded for tax purposes use
Determining residency status
the guidelines below:
Tax payments are required when nonresidents sell Oregon
Limited Liability Companies (LLCs). An LLC owned
real property (unless the transfer is exempt, see Exempt
entirely by a single member is disregarded for tax purposes
transfers on page 1). If you are uncertain whether or not
and tax payment requirements are based on the owner of
transferors are Oregon residents, use the criteria below to
the LLC. If an LLC is owned by one individual or spouses/
help make that determination. If still in doubt, authorized
registered domestic partners (RDPs) filing a joint return,
agents must obtain a completed Form WC from the trans-
treat the member(s) as individuals and follow the related
feror attesting to their residency status.
instructions. If the seller is a single member LLC owned by
an exempt transferor, such as a pass-through entity, then
Who is an Oregon resident?
tax payments are not required.
A transferor is a full-year resident of Oregon (even if living
Grantor Trusts. A grantor trust is not recognized for tax
outside of Oregon) if all of the following are true:
purposes because the grantor retains substantial control. A
grantor trust is sometimes referred to as a “revocable trust”
• The transferor thinks of Oregon as his or her permanent
or a “living trust.” As long as the grantor is living, treat the
home;
trust as an individual and follow the related instructions.
• Oregon is the center of the transferor’s financial, social,
If the grantor is deceased, the trust is irrevocable and tax
and family life; and
payments are not required.
• Oregon is the place the transferor intends to return to
when away.
Form WC
The transferor is still an Oregon resident if he or she moves
General
out of Oregon temporarily or moved back to Oregon after a
temporary absence.
A nonexempt transferor must complete Form WC, Writ-
ten Affirmation for an Oregon Real Property Conveyance. This
Who is a nonresident?
is true even if a nonexempt transferor is engaging in an
exempt transfer. Form WC is retained in the records of the
A nonresident is a transferor that maintains his or her
authorized agent for six years from the date the transac-
permanent home outside of Oregon all year. Sometimes,
tion closed. The authorized agent also sends a copy of Form
Oregon residents are deemed nonresidents if they:
WC and any required attachments to the department. The
• Maintained a permanent home outside Oregon the entire
transferor should keep a copy of the Form WC provided to
year; and
the authorized agent.
• Didn’t keep a home in Oregon during any part of the
Complete the top section of the form for all nonexempt
year; and
transferors that must complete Form WC. Use the following
• Spent less than 31 days in Oregon during the year.
guidelines to determine which box to check in the “Type of
property conveyed” section:
What if the transferor moves into or out of
“Specially assessed” is property that has received a spe-
Oregon during the year?
cial property tax assessment such as a reduced valuation
A transferor who moved into or out of Oregon during the
or deferral.
calendar year is a “part-year resident.” The individual is a
“Rental property” is any real property that is a rental build-
resident for part of the year and a nonresident for part of the
ing or structure (including mobile homes) for which rental
year. A part-year resident may only claim exemption from
income is received (commercial, industrial, or residential).
this requirement if the conveyance occurs and the proceeds
are disbursed during the part of the year that the transferor
“Undeveloped land” is a parcel of land that is vacant and
is a resident of Oregon or another exemption applies.
has not been improved for accessibility to utilities nor has
any structures located upon it.
Example 1: Anne moved from Oregon to California on
March 31, 2010. She sold her Oregon rental property on July
“Farm use” is land that is employed in the trade or business
28, 2010. Even though Anne was a resident of Oregon for the
of farming for a profit. The land may be zoned for exclusive
first three months of the year, she was not a resident at the
farm use (EFU) but is not required to be.
time of the conveyance so she may not claim exemption as
“Acquired as gift” is property that the seller did not pur-
a resident of Oregon.
chase. It could be property that was inherited or simply
gifted to the seller.
Determining nonexempt status
When the property is owned by more than one
Disregarded entities
transferor
If a transferor is a limited liability company (LLC) or a
grantor trust, special rules apply for tax purposes. Some-
Each transferor is considered separately for exemption. If
times these entities are disregarded for tax purposes. To
one transferor is exempt, tax payments are only required on
150-101-183 (Rev. 12-12)
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