Oregon Administrative Rules
Chapter 150 - DEPARTMENT OF REVENUE
Division 316 - PERSONAL INCOME TAX GENERAL PROVISIONS
Section 150-316-0006 - Application of Capital Losses and Capital Loss Carryforwards
Universal Citation: OR Admin Rules 150-316-0006
Current through Register Vol. 63, No. 9, September 1, 2024
(1) Part-year resident and nonresident returns.
(a) A
nonresident is allowed a capital loss or capital loss carryforward on the
Oregon return when attributable to Oregon sources.
(b) A part-year resident is allowed a capital
loss or capital loss carryforward on the Oregon return if the loss was incurred
while a nonresident and is attributable to Oregon sources or if the loss was
incurred while a resident.
(c) The
amount of the capital loss or capital loss carryforward that is not
attributable to Oregon sources may not be included as Oregon taxable income on
the Oregon tax return. The capital loss or capital loss carryforward not
attributable to Oregon sources cannot be used to reduce a capital gain
attributable to Oregon sources.
Example 1:
Taxpayer is an Arizona resident and incurs a capital loss from Oregon sources.
Taxpayer is allowed the capital loss to determine Oregon taxable
income.
Example 2: Taxpayer moves
to Oregon and becomes a resident as of June 1. Prior to becoming a resident,
taxpayer incurs a non-Oregon source capital loss of $50,000. Taxpayer is
allowed to deduct a $3,000 loss on the federal return. Taxpayer may not include
the $3,000 loss in the Oregon column on the Oregon return.
Example 3: The same scenario as example 2,
except taxpayer recognizes a capital gain of $70,000 as of August 1. On the
federal return, taxpayer offsets the $70,000 gain with the $50,000 loss for a
net gain of $20,000. The $50,000 loss may not be included in Oregon taxable
income and may not be used to offset the capital gain recognized while the
taxpayer was an Oregon resident.
(2) Full-year resident return.
(a) A resident is allowed a capital loss or
capital loss carryforward on the Oregon return if the loss was incurred while a
nonresident and was attributable to Oregon sources or if the loss was incurred
while a resident.
(b) The amount
of capital loss or capital loss carryforward that is not attributable to Oregon
sources is added back on the Oregon tax return when determining Oregon taxable
income. The capital loss or capital loss carryforward not attributable to
Oregon sources cannot be used to reduce a capital gain attributable to Oregon
sources and is added back on the Oregon tax return when determining Oregon
taxable income.
Example 4: In tax year 2017,
taxpayer is a nonresident and incurs a non-Oregon source capital loss of
$50,000 and has a $47,000 carryforward. As of January 1, 2018, taxpayer is a
full-year Oregon resident. Taxpayer claims a $3,000 loss on the 2018 federal
return attributable to the $47,000 capital loss carryforward. Taxpayer must add
back the $3,000 loss on the Oregon return to determine Oregon taxable
income.
Example 5: The same
scenario as example 4, except on March 5, 2018, taxpayer recognizes a $100,000
capital gain. On the 2018 federal return, taxpayer offsets the $100,000 gain
with the $47,000 capital loss carryforward for a net gain of $53,000 on the
federal return. The $47,000 capital loss carryforward must be added back on the
2018 Oregon return to determine Oregon taxable income.
Statutory/Other Authority: ORS 305.100
Statutes/Other Implemented: ORS 316.007
Disclaimer: These regulations may not be the most recent version. Oregon may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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