Oregon Department of Revenue

Rule Rule 150-314-0460
Apportionment of Net Loss


(1)

When a corporation or consolidated group of corporations is taxable both within and without this state, their Oregon net loss must be computed using the apportionment provisions in ORS 314.280 (Allocation of income of financial institution or public utility from business within and without state), or 314.610 (Definitions for ORS 314.605 to 314.675) through 314.667 (Additional methods to determine extent of business activity in this state).

(2)

If a corporation filed a combined return (prior to 1986) or a separate (not consolidated) return in the year of the loss, and files a consolidated return in the year to which the loss is carried, the net loss deduction may be limited. The allowable net loss deduction cannot exceed the Oregon net income attributed to the corporation with the net loss carryover. For the purpose of determining the net loss deduction allowable, the consolidated Oregon net income must be attributed to the corporation based on its share of the Oregon apportionment percentage. The following example demonstrates the application of this section: [Example not included. See ED NOTE].

(3)

If a corporation was included in a consolidated return in the year of the net loss and now files a separate return, or is included in a different consolidated return in the year to which the net loss is carried, the consolidated Oregon net loss must be apportioned to the corporations included in the net loss return for purposes of determining the allowable net loss carryover. The consolidated Oregon net loss must be apportioned to the corporations with taxable activities in Oregon, based upon their Oregon apportionment percentages. The net losses computed can be carried forward and deducted in subsequent years’ returns (subject to the carryover limitations specified in OAR 150-317-0460 (Limitation on Oregon Net Loss Deduction). The following example demonstrates the application of this section: [Example not included. See ED NOTE].

(4)

Net losses that are attributed to corporations which continue to be included in the same consolidated Oregon return can be deducted fully against the Oregon consolidated net income. [Example not included. See ED NOTE].

(5)

Paragraphs (2), (3) and (4) of this rule apply to Oregon net losses carried forward and deducted in tax years beginning on or after January 1, 1986.

(6)

The net loss carryover to a consolidated return when the loss is from a separate return of a prior year in which the taxpayer should have filed a combined or consolidated return must be recalculated as if the taxpayer had filed a combined or consolidated return.
Example: Corporation A reported a loss in 1999 on a separate return. Corporation A should have filed a consolidated return with Corporation B in 1999 A 1999 consolidated return would have resulted in net income. The net loss carryover for Corporation A from 1999 is zero.
[ED. NOTE: To view attachments referenced in rule text, click here to view rule.]
Source

Last accessed
Jun. 8, 2021