Biannual Newsletter: Spring 2024

What’s inside: Updates for 2023 Tax Year, Corporate Transparency Act, Portland Adopts Oregon’s Market-Souring Rules, Downtown Business Incentive Credit

Credit for College Saving Plan Increases in OR

1. If you made contributions to an Oregon 529 or ABLE account in 2023, you are eligible for a tax credit. Married Filing Joint taxpayers will see a $40 increase from last year, receiving a credit of $340. All other taxpayers will see a $20 increase, receiving a credit of $170.

Oregon Surplus “Kicker” credit

This credit is offered on odd years when revenues are more than predicted. It is designed to return some of your taxes that have already been paid. It can be claimed as a refundable tax credit or it can be donated to the State School Fund. The amount is calculated based on 2022’s tax liability (before any credits) multiplied by 44.28%. To learn more, click here.

Corporate Transparency Act

1. The Corporate Transparency Act went into effect on January 1st, 2024 to “prevent corrupt and other actors from laundering illicit funds through anonymous companies in the United States” (US Department of the Treasury, 2023). This means that companies are required to report information to the Financial Crimes Enforcement Network (FinCEN) about their beneficial owners.

2. Companies must report through the FinCEN’s website and there is no fee for submitting the report. 

3. There are 23 business entity types that are exempt from reporting including inactive entities, banks, large operating companies, and more. For the full list, click here.

4. Businesses formed before January 1st, 2024 have up to one year to complete the filing.

5. For more information:

   1. U.S. Chamber of Commerce

   2. Department of the Treasury

   3. Oregon Secretary of State

Portland adopts Oregon’s market-sourcing rules

1. Portland City Council voted to adopt Oregon’s market sourcing rules for sourcing sales of intangible goods and services.

2. Old Rule

1. Apportionment based on the location of ‘income producing activity’

2. Personal service income apportioned where services are performed

3. Income from independent contractors apportioned to the business’ domicile

4. Hourly method used for services performed partly within and outside the City/Country

3. New Rule

1. Shifts to market-based sourcing

2. Income from services sourced to where the customer benefits, not where performed

3. Focus on customer location rather than physical presence of business operations

4. Applies to diverse income types including services, intangibles, and royalties.

For more information, click here.

Downtown Business Incentive Credit (City of Portland)

This credit was enacted by Portland City Council in September 2023 that is available to businesses located in four Portland sub-districts who enter into a new lease, extend their lease, or own and occupy building space. Businesses must be registered with the Revenue Division and maintain 15 full-time employees. Qualifying businesses must apply for the credit by January 31st, 2024 for tax year 2023 and January 31st, 2025 for tax year 2024. To learn more about this credit, visit portland.gov here.