Tax Payments On Real Property Conveyances - 2015 printable pdf download

2015

Tax Payments on Real Property Conveyances

Form OR-18, Form WC, Form TPV-18, and instructions

Introduction

Exemptions

Real estate tax payments at a glance

Exempt transferors

Those who sell Oregon real property are subject to Oregon

Authorized agents are not required to submit tax payments

tax on the gain from the sale. Escrow agents and, in some

if the transferor is an exempt transferor, such as:

cases, attorneys (“authorized agents”) are usually required

• An individual who is a resident of Oregon (see Deter-

to withhold and remit tax payments to the Oregon Depart-

mining residency status);

ment of Revenue as an estimated payment for any taxes that

may be due when the seller is a nonresident. Taxpayers will

• A C corporation registered to do business in Oregon;

claim these tax payments on their Oregon tax returns filed

• A personal representative, executor, conservator, bank-

for the year in which the sale was made. These instructions

ruptcy trustee, or other person acting under judicial review;

and forms are designed to inform authorized agents and tax-

• A pass-through entity; or

payers of their requirements. Note that there are exceptions

• A governmental instrumentality (i.e. city, county, state, or

as indicated in these instructions.

federal agencies).

Definitions

Authorized agents should keep information showing that

The following terms are used in these instructions:

the seller is an exempt transferor or obtain Form WC, Writ-

ten Affirmation for an Oregon Real Property Conveyance, from

is an escrow agent licensed under

“Authorized agent”

the seller.

Oregon Revised Statutes (ORS) 696.505 to 696.590. An attor-

ney is an authorized agent if there is no licensed escrow

Exempt transfers

agent involved and the attorney deposits the proceeds of

the sale into a client trust account and disburses funds to

Authorized agents are not required to submit tax payments if:

the transferor.

• The consideration (total sales price) for the real property is

“BIN” is the Oregon business identification number a busi-

$100,000 or less;

ness is assigned for Oregon tax purposes.

• The transferor delivers to the authorized agent a written

is a transferor that is:

“Exempt transferor”

assurance as provided in section 6045(e) of the Internal

Revenue Code (IRC) that the sale or exchange qualifies for

• A resident of Oregon;

exclusion of gain as the seller’s principal residence under

• An entity registered to do business in Oregon;

IRC section 121;

• A pass-through entity;

• The conveyance is pursuant to a judicial foreclosure proceed-

• An agency or instrumentality of the United States or the

ing, a writ of execution, a nonjudicial foreclosure of a trust

State of Oregon; or

deed, or a nonjudicial forfeiture of a land sale contract; or

• A city, county, or other municipal or public corporation.

• The conveyance is occurring instead of foreclosure of

is the federal employer identification number a busi-

“FEIN”

a mortgage, trust deed sales contract, or other security

ness is assigned for federal tax purposes.

instrument, or a land sale contract with no additional mon-

“Nonexempt transferor”

is a transferor that is a nonresident

etary consideration.

of Oregon, including grantor trusts and single-member

If the transferor is selling a

Principal residence exemption.

LLCs, or a C corporation that is not registered to do busi-

personal residence and the entire gain qualifies for exclu-

ness in Oregon.

sion under federal law, the transferor must provide a written

is an entity through which income

“Pass-through entity,”

assurance to the authorized agent that the entire gain quali-

and expenses flow to the owners of the entity, such as a

fies for exclusion under IRC section 121. The transferor does

partnership, S corporation, limited liability company (LLC)

not need to complete Form WC.

that is not a disregarded entity, limited liability partnership

(LLP), certain trusts, or estates.

If the transferor is selling a personal residence and the entire

is a person who acquires ownership of real

“Transferee”

gain is not excludable from federal tax, the transferor must

property located in Oregon.

complete Form WC. Situations where the entire gain is not

excludable include if the taxpayer claimed business use of

is a property owner who transfers, sells, deeds,

“Transferor”

home deductions in the past, or the gain exceeds the federal

or otherwise conveys their ownership interest in real prop-

erty to another person or entity.

exclusion amount.

150-101-183 (Rev. 12-14)

Tax Payments On Real Property Conveyances - 2015

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