OAR 150-316-0035
Oregon Net Operating Losses — Treatment After 1984

(1) Applicability of this rule. This rule applies to the computation of a net operating loss (NOL) occurring in loss years beginning after December 31, 1984; and a net operating loss deduction (NOLD) allowed or allowable in tax years beginning after December 31, 1984.
(2) Definitions for purposes of this rule.
(a) “Prohibited amounts” means those amounts that the state of Oregon is prohibited from taxing, such as all stocks, bonds, Treasury notes, and other obligations of the United States as provided in 31 United States Code Section 3124. Prohibited amounts do not include such items as federally taxable social security benefits since Oregon is not prohibited from indirectly taxing such types of income.
(b) “Oregon Adjusted Gross Income (Oregon AGI)” for a full-year resident is generally the same as federal adjusted gross income (federal AGI). For a nonresident, “Oregon AGI” means the items included in federal AGI as defined in IRC Section 62 that relate to Oregon sources without modifications.
(c) “Modified Oregon taxable income” for a full-year resident is generally the same as federal taxable income as modified in IRC Section 172(d). For a nonresident, it means Oregon AGI reduced by the sum of the following:
(A) Federal itemized or standard deductions;
(i) Federal itemized deductions. For part-year and nonresident taxpayers, only the Oregon percentage of federal itemized deductions are used; or
(ii) Federal standard deduction. For part-year and nonresident taxpayers, only the Oregon percentage of the federal standard deduction is used;
(B) Federal personal exemption(s); and
(C) Prohibited amounts included in Oregon AGI.
(3) NOL for a full-year resident.
(a) For Oregon purposes, a resident’s NOL is computed in the same manner as for federal purposes without Oregon modifications. Generally, the Oregon NOL is the same as the federal NOL. The only modification necessary is to subtract prohibited amounts.
(b) The computation of the Oregon NOL begins with the Oregon AGI to arrive at modified Oregon taxable income. Modified Oregon taxable income is then adjusted as required by IRC Section 172(d).
(4) Application of an NOL for a full-year resident.
(a) General rule. An Oregon NOL for any loss years is applied in the same manner as the federal NOL as provided in IRC Section 172(b). If the loss was not attributable to Oregon sources and was incurred while the taxpayer was a nonresident, there is no Oregon NOL to carry over even if the taxpayer later becomes an Oregon resident. In such cases, the amount of the NOL carryover that is not attributable to Oregon sources is added back on the Oregon resident tax return. If a taxpayer carries back a federal NOL, the taxpayer is treated as carrying the loss back for Oregon purposes as well. If a taxpayer makes an election to carry over the federal NOL, the taxpayer is treated as making the same irrevocable election for Oregon purposes as well.
(b) Exceptions.
(A) If a taxpayer has an Oregon NOL but does not have a federal NOL, the taxpayer may elect to carry the Oregon NOL over to the next succeeding year. This is an irrevocable election that a taxpayer makes on a timely filed Oregon loss year return (including extensions). If no such election is made, then the taxpayer may only carry the Oregon loss forward or back in the same manner as provided in IRC Section 172(b).
(B) If a taxpayer is not required to file an Oregon return for all years to which the federal NOLD is applied, the Oregon NOL is carried to the year in which the loss may be first applied.
(C) The total number of years to which an NOL may be carried back or forward is the same for Oregon and federal (including exceptions and limitations).
(5) NOLD carryback and carryover amount for a full-year resident.
(a) A taxpayer’s NOLD, carryback, and carryover amount is computed in the same manner as for federal purposes. The method to compute the carryback and carryover amount is not modified for Oregon purposes.
(b) For a full-year resident, generally an NOLD, carryback, and carryover amount is the same as for federal purposes except that prohibited amounts as defined in section (2)(a) of this rule are not taken into consideration.
(6) NOL for a part-year resident and a nonresident.
(a) A nonresident is allowed an Oregon NOL for any loss year when the NOL is attributable to Oregon sources. A taxpayer is not allowed an NOL or carryover on the Oregon return if the loss was incurred while the taxpayer was a nonresident and the loss was not attributable to Oregon. The computation of the allowable NOL for Oregon purposes begins with Oregon AGI as defined in this rule, which is generally income after federal adjustments in the Oregon column.
(b) Next, calculate federal modified taxable income as it relates to Oregon. Starting with Oregon AGI, subtract federal itemized or standard deductions as multiplied by the Oregon percentage (as calculated on the Oregon return). Note: Federal exemptions are not required to be used in this calculation and may be ignored, because they always have a net effect.
(c) Add back any modifications provided in IRC Section 172(d) applied to all items of income and deduction included in Oregon AGI or federal deductions. The IRC Section 172(d) modifications attributable to Oregon sources are the following:
(A) Oregon NOLD from prior years included in Oregon income after adjustments.
(B) Net Oregon capital loss deduction.
(C) Excess of nonbusiness deductions over nonbusiness income that are from Oregon sources. Do not include the standard deduction or itemized deductions or non-Oregon items in this calculation.
(D) Nonbusiness federal itemized deductions or standard deduction multiplied by the Oregon percentage.
(d) Add back prohibited amounts as defined in this rule.
(7) Application of an NOL for a part-year resident and a nonresident.
(a) General rule. An Oregon NOL for any loss years is applied in the same manner as the federal NOL as provided in IRC Section 172(b). If the loss was not attributable to Oregon sources and was incurred while the taxpayer was a nonresident, there is no Oregon NOL to carry over. If a taxpayer carries back a federal NOL, the taxpayer is treated as carrying the loss back for Oregon purposes as well. If a taxpayer makes an election to carry over the federal NOL, the taxpayer is treated as making the same irrevocable election for Oregon purposes as well.
(b) Exceptions.
(A) If a taxpayer has an Oregon NOL but does not have a federal NOL, the taxpayer may elect to carry the Oregon NOL forward or back in the same manner as provided in IRC Section 172(b).
(B) If a taxpayer is not required to file an Oregon return for all years to which the federal NOLD is applied, the Oregon NOL is carried to the year in which the loss may be first applied.
(C) The total number of years to which an NOL may be carried back or forward is the same for Oregon and federal (including exceptions and limitations).
(8) NOLD carryback and carryover amount for a part-year resident and a nonresident.
(a) A taxpayer’s NOLD, carryback, and carryover amount is computed in the same manner as for federal purposes. The method to compute the carryback and carryover amount is not modified for Oregon purposes.
(b) A part-year resident and a nonresident use the federal method without modifications, except that prohibited amounts are not taken into consideration, and the NOLD, carryback and carryover are based only upon amounts attributable to Oregon sources.
[Publications: Contact the Oregon Department of Revenue for information about how to obtain a copy of the publication referred to or incorporated by reference in this rule pursuant to ORS 183.360 (Publication of rules and orders)(2) and ORS 183.355 (Filing and taking effect of rules)(1)(b).]
[ED. NOTE: To view attachments referenced in rule text, click here to view rule.]

Source: Rule 150-316-0035 — Oregon Net Operating Losses — Treatment After 1984, https://secure.­sos.­state.­or.­us/oard/view.­action?ruleNumber=150-316-0035.

150‑316‑0006
Application of Capital Losses and Capital Loss Carryforwards 150‑316‑0007
Policy — Application of Various Provisions of the Federal Internal Revenue Code 150‑316‑0009
Policy — Application of Various Provisions of Tax Law to Domestic Partners 150‑316‑0015
Adoption of Federal Law 150‑316‑0020
Tax Reform Act of 1984 Adjustments 150‑316‑0025
Definition: “Resident” 150‑316‑0027
Status of Individuals in a Foreign Country 150‑316‑0035
Oregon Net Operating Losses — Treatment After 1984 150‑316‑0040
Administrative and Judicial Interpretations 150‑316‑0043
Qualified Business Income Reduced Tax Rate (QBIRTR) 150‑316‑0045
Taxable Income of Nonresidents and Part-year Residents 150‑316‑0050
Farm Capital Gain 150‑316‑0055
Transitional Provision to Prevent Doubling Income or Deductions 150‑316‑0060
Taxable Income of Resident 150‑316‑0065
Social Security and Railroad Retirement Benefits Eligible for Subtraction 150‑316‑0080
Credit for Income Taxes Paid to Another State 150‑316‑0082
Credit for Taxes Paid to Another State When Paid by a Pass-Through Entity 150‑316‑0084
Credit for Income Taxes Paid to Another State — Computation 150‑316‑0086
Credit for Income Taxes Paid to Other States — Proof Required and Procedure for Obtaining the Credit 150‑316‑0088
Addition of Taxes Paid to Another State Claimed as an Itemized Deduction 150‑316‑0090
Credit for Duplicative State Taxation Relating to Different Years 150‑316‑0115
Disabled Child Exemption Credit 150‑316‑0120
Credit for Political Contributions 150‑316‑0125
Credit for the Gain on the Sale of a Residence Taxed by Another State 150‑316‑0130
Credit for Installation of Alternative Energy Devices 150‑316‑0135
Proration of Income and Deductions for Nonresidents and Part-Year Residents 150‑316‑0145
Proration for Pass-through Entity Income of Part Year Oregon Residents 150‑316‑0150
Separate or Joint Federal Returns for Spouses in a Marriage 150‑316‑0155
Nonresident Partners: Guaranteed Payments 150‑316‑0157
Nonresident Partners: Other Methods of Allocation and Apportionment 150‑316‑0165
Gross Income of Nonresidents 150‑316‑0167
Gross Income of Nonresidents 150‑316‑0169
Gross Income of Nonresidents 150‑316‑0171
Gross Income of Nonresidents 150‑316‑0173
Gross Income of Nonresidents 150‑316‑0175
Gross Income of Nonresidents 150‑316‑0179
Student Loan Interest Deduction — for Part-Year and Nonresidents 150‑316‑0181
Moving Expense Deduction — for Part-year and Nonresidents 150‑316‑0183
Gross Income of Nonresidents 150‑316‑0185
Gross Income of Nonresidents: Waterway Workers 150‑316‑0195
Alimony Deduction — for Part-Year and Nonresidents 150‑316‑0197
Nonresident Deduction for Contributions to IRA, Keogh, or Qualified Medical Savings Accounts 150‑316‑0205
Credit for Taxes Paid to State of Residence 150‑316‑0225
Retirement Income Credit 150‑316‑0230
Subtraction for Previously Taxed Contributions 150‑316‑0234
“Withholding Statement” and “Exemption Certificate” 150‑316‑0235
Withholding: Basis of Amount Withheld 150‑316‑0237
Employees Exempt from Withholding 150‑316‑0239
Withholding on Fringe Benefits 150‑316‑0241
Independent Contractor Definition 150‑316‑0243
Personal Liability of Responsible Officers, Members, or Employees for Taxes Withheld 150‑316‑0250
Bonding Requirements for Delinquent Withholding Employers 150‑316‑0255
Withholding by Employers 150‑316‑0257
Employer’s Election of Method of Computing Withholding 150‑316‑0265
Withholding Payments: Cash Basis 150‑316‑0267
Additional Time to File Reports 150‑316‑0275
Treatment of Payroll Based Program Overpayments 150‑316‑0282
Exemptions for Military Personnel 150‑316‑0284
Penalty 150‑316‑0290
Procedure for Correcting the Filing of Withholding Certificates 150‑316‑0295
Credit for Tax Withheld 150‑316‑0297
Where Taxpayer Reports on Fiscal Year Basis 150‑316‑0305
Withholding Income Taxes on IRAs, Annuities, and Compensation Plans 150‑316‑0307
Withholding Income Taxes on IRAs, Annuities, and Compensation Plans 150‑316‑0315
Alternative Withholding Payment Method for Employers to Avoid Undue Burden 150‑316‑0320
Voluntary Withholding for Retired Members of the Uniformed Services 150‑316‑0325
Voluntary Withholding for Civil Service Annuitants 150‑316‑0330
Semiannual Reports and Payments 150‑316‑0332
Withholding: Payment Due Dates 150‑316‑0334
Withholding Tax Payment Requirements for Agricultural Employers 150‑316‑0336
Employee’s Rights 150‑316‑0345
Requirement to use Electronic Funds Transfer 150‑316‑0347
Electronic Funds Transfer. Payroll taxes and corporation estimated income and excise taxes not combined in determining mandate. Payments to be included. 150‑316‑0355
Withholding: Payment and Reports 150‑316‑0357
Waiver of Termination Reports 150‑316‑0359
Withholding: Annual Report by Employer 150‑316‑0361
Combined Reports and Statewide Transit Tax Reports: Agricultural Employers 150‑316‑0370
Liability for Unpaid Withholdings 150‑316‑0372
Officer Liability: Joint Determination of Liability Conference 150‑316‑0380
Withholding Penalties 150‑316‑0385
Nonresident Alternate Filing 150‑316‑0390
Deductions Allowed on Either the Inheritance Tax Return or the Fiduciary Income Tax Return 150‑316‑0395
Tax Treatment of Unincorporated Organization 150‑316‑0400
Resident and Nonresident Estates and Trusts 150‑316‑0402
Oregon Qualified Trust Tax Return 150‑316‑0410
Fiduciary Adjustment 150‑316‑0415
Accumulation Distribution Credit for Oregon Taxes Paid by Trust During Income Accumulation Years 150‑316‑0420
Taxable Income of Nonresident Estate or Trust 150‑316‑0425
Oregon Multiple Funeral Trust Tax Return 150‑316‑0427
Persons Required to Make Returns 150‑316‑0435
Petitioning Department to Equally Split Joint Liability 150‑316‑0440
Innocent Spouse, Separation of Liability, and Equitable Relief Provisions 150‑316‑0445
Liability of Fiduciaries 150‑316‑0450
Decedent’s Estate: Request for a Final Tax Determination 150‑316‑0452
Decedents’ Estate: Application for Discharge from Personal Liability for Tax on Decedent’s Income 150‑316‑0465
Estimated Tax 150‑316‑0470
Allocation of Joint Estimated Tax Payments 150‑316‑0475
Estimated Tax: Farmer’s and Fisher’s 150‑316‑0480
Estimated Tax: Application of Prior Year Overpayment (Refund) 150‑316‑0485
Tax Used to Compute Underpayment of Estimated Tax 150‑316‑0487
Estimated Tax: Underpayment Interest Not Imposed if There is a Casualty, Disaster or Other Unusual Circumstances 150‑316‑0489
Estimated Tax: Underpayment Interest Not Imposed If There Is Reasonable Cause 150‑316‑0491
Estimated Tax: Partnership and S Corporation Income of Part-year Residents and Nonresidents 150‑316‑0493
Required Installments for Estimated Tax 150‑316‑0495
Estimated Tax: Joint Return to Single or Separate Return 150‑316‑0497
Estimated Tax: Single or Separate Returns to Joint Return 150‑316‑0505
Oregon Lottery Winnings and Losses 150‑316‑0507
Modification of Federal Taxable Income: Interest and Dividends 150‑316‑0509
U.S. Government Obligations 150‑316‑0511
Addition for Original Issue Discount (OID) 150‑316‑0513
Modification of Federal Taxable Income: Adding Interest or Dividends of the United States Exempted by Federal Income Tax Law 150‑316‑0515
Modification of Federal Taxable Income: Adding Federal Estate Tax Attributable to Income in Respect of a Decedent Not Taxable by Oregon 150‑316‑0519
Gain or Loss Upon the Sale of State and Municipal Bonds of Other States (Foreign States) 150‑316‑0525
U.S. Government Interest in Retirement Accounts 150‑316‑0530
Pool of Assets that Qualify to Pay State Exempt-Interest Dividends 150‑316‑0535
Federal Tax Deduction: Accrual Method of Accounting Required 150‑316‑0537
Adjustment of Federal Tax Liability 150‑316‑0545
Election to Include Child’s Unearned Income — Addition Required 150‑316‑0550
Special Oregon Medical Subtraction 150‑316‑0555
Modification of Federal Taxable Income: Itemized vs. Standard Deduction 150‑316‑0557
Modification of Federal Taxable Income: Oregon Income Tax Claimed as an Itemized Deduction 150‑316‑0559
Modification of Federal Taxable Income: Previously Taxed Contributions to Pension or Annuity 150‑316‑0565
Basis of Depreciable Assets Moved into Oregon 150‑316‑0567
Property Subject to Accelerated Cost Recovery System 150‑316‑0569
Adjustment to Income for Basis Differences 150‑316‑0575
Amount Specially Taxed Under Federal Law to Be Included in Computation of State Taxable Income: Accumulation Distributions 150‑316‑0580
Definition for Severely Disabled Exemption 150‑316‑0585
Exemption for Blind and Severely Disabled 150‑316‑0590
Substantiation for Permanently Severely Disabled 150‑316‑0595
Exempt Income of Native Americans 150‑316‑0600
Oregon Investment Advantage Apportionable Income Exemption 150‑316‑0605
Military Pay Subtraction 150‑316‑0607
First-time Home Buyer Savings Account 150‑316‑0610
Road Construction Worker’s Travel Expenses 150‑316‑0615
Substantiation Required for Construction Worker and Loggers Expenses 150‑316‑0625
(Miscellaneous) Valuation of Forest Land or “Farm Use” Land for Oregon Inheritance Tax Purposes 150‑316‑0630
Scholarship Awards used for Housing Expenses 150‑316‑0635
Subtraction for Land Contributed to Educational Institutions 150‑316‑0640
Subtraction for Qualified Investment of Severance Pay 150‑316‑0650
Waiver of Frivolous Return Penalty Imposed Under ORS 316.992 150‑316‑0652
Frivolous Return Penalty
Last Updated

Jun. 8, 2021

Rule 150-316-0035’s source at or​.us