Personal Income Tax

ORS 316.992
Penalty for filing incorrect return that is based on frivolous position or is intended to delay or impede administration

  • appeal


The Department of Revenue shall assess a penalty of $250 against any individual who files what purports to be a return of the tax imposed by this chapter but which:


Does not contain information on which the substantial correctness of the self-assessment may be judged; or


Contains information that on its face indicates that the self-assessment is substantially incorrect.


A penalty may be imposed under subsection (1) of this section only if the conduct referred to in subsection (1) of this section is due to:


A position which is frivolous; or


An intention, apparent on the face of the purported return, to delay or impede the administration of the income tax laws of this state.


The penalty imposed under this section is in addition to any other penalty imposed by law. Any person against whom a penalty is assessed under this section may appeal to the tax court as provided in ORS 305.404 (Oregon Tax Court) to 305.560 (Appeals procedure generally). If the penalty is not paid within 10 days after the order of the tax court becomes final, the department may record the order and collect the amount assessed in the same manner as income tax deficiencies are recorded and collected under ORS 314.430 (Warrant for collection of taxes).


If an assessment of tax due for the taxable year with respect to which a penalty is imposed under this section is under appeal at the same time that an appeal is filed under this subsection, the tax court may consolidate the appeals into a single proceeding.


As used in this section, “a position which is frivolous” includes, but is not limited to:


Reference to a spurious constitutional argument;


Reliance on a “gold standard” or “war tax” deduction;


An argument that wages or salary are not includable in taxable income;


An argument that the Sixteenth Amendment to the United States Constitution was not properly adopted; or


An argument that “unenfranchised, sovereign, freemen or natural persons” are not subject to the tax laws. [1987 c.843 §11; 1995 c.650 §39]
Chapter 316

Notes of Decisions

Unless the divorce decree specifically designates that payments are for child support, payments will be treated as alimony. Henderson v. Dept. of Rev., 5 OTR 153 (1972)

The goal of this chapter is to incorporate all of the provisions of the federal Internal Revenue Code; taxable income should be adjusted whenever the result of the adjustment is to give effect to the policies or principles of the federal Internal Revenue Code, even though no express authority for the adjustment is present in the statutes. Christian v. Dept. of Rev., 269 Or 469, 526 P2d 538 (1974); Smith v. Dept. of Rev., 270 Or 456, 528 P2d 73 (1974)

By its enactment of this chapter, the legislature intended to adopt §172 of the federal Internal Revenue Code allowing for the carryback and carryforward of net operating losses. Christian v. Dept. of Rev., 269 Or 469, 526 P2d 538 (1974)

Where plaintiff failed to appeal timely as required by this section, appeal rights were not preserved so that cause could be considered on merits. Dela Rosa v. Dept. of Rev., 11 OTR 201 (1989), aff'd 313 Or 284, 832 P2d 1228 (1992)

Where taxpayers paid foreign income taxes on foreign income and claimed foreign taxes paid as federal tax credit and as state business expense deduction, taxpayers who claim federal foreign tax credit are entitled only to foreign tax deduction provided in ORS 316.690. Whipple v. Dept. of Rev., 309 Or 422, 788 P2d 994 (1990)

For purposes of claim preclusion, all issues regarding taxpayer's income tax liability for tax year constitute same claim. U.S. Bancorp v. Dept. of Revenue, 15 OTR 13 (1999)

Atty. Gen. Opinions

Political contributions as credit against Oregon tax return, (1974) Vol 37, p 159

Law Review Citations

57 OLR 309 (1978); 16 WLR 373 (1979)


Last accessed
Jun. 26, 2021