68th OREGON LEGISLATIVE ASSEMBLY--1995 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1161
House Bill 3107
Sponsored by Representative EIGHMEY (at the request of Oregonians
for Tax Fairness)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Increases personal and corporate income tax rates and doubles
standard deduction. Applies to tax years beginning on or after
January 1, 1996.
A BILL FOR AN ACT
Relating to taxes imposed upon or measured by income; creating
new provisions; and amending ORS 316.037, 316.695 and 317.061.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 316.037 is amended to read:
316.037. (1)(a) A tax is imposed for each taxable year on the
entire taxable income of every resident of this state. The amount
of the tax shall be determined in accordance with the following
table:
_________________________________________________________________
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
If taxable income The tax is:
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
Not over $2,000.. 5% of
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
taxable
income
Over $2,000 but not
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
over $5,000...... $100 plus 7%
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
of the excess
over $2,000
Over $5,000 { +
but not + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
over $10,000 + }
................. $310 plus 9%
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
of the excess
over $5,000
{ + Over $10,000 but not + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
over $15,000..... $760 plus 10.5% + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
of the excess
over $10,000 + }
{ + Over $15,000 but not + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
over $35,000..... $1,285 plus 12% + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
of the excess
over $15,000 + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
Over $35,000..... $3,685 plus 13% + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
of the excess
over $35,000 + }
_________________________________________________________________
____________________________________________________________
END OF POSSIBLE IRREGULAR TABULAR TEXT
____________________________________________________________
(b) For tax years beginning in each calendar year, the
department shall adopt a table which shall apply in lieu of the
table contained in paragraph (a) of this subsection, as follows:
(A) The minimum and maximum dollar amounts for each rate
bracket for which a tax is imposed shall be increased by the
cost-of-living adjustment for the calendar year.
(B) The rate applicable to any rate bracket as adjusted under
subparagraph (A) of this paragraph shall not be changed.
(C) The amounts setting forth the tax, to the extent necessary
to reflect the adjustments in the rate brackets, shall be
adjusted.
(c) For purposes of paragraph (b) of this subsection, the
cost-of-living adjustment for any calendar year is the percentage
(if any) by which the U.S. City Average Consumer Price Index for
the average of the monthly indexes for the second quarter of the
calendar year exceeds the average of the monthly indexes of the
second quarter of the calendar year 1992.
(d) As used in this subsection, 'U.S. City Average Consumer
Price Index' means the U.S. City Average Consumer Price Index for
All Urban Consumers (All Items) as published by the Bureau of
Labor Statistics of the United States Department of Labor.
(e) If any increase determined under paragraph (b) of this
subsection is not a multiple of $50, the increase shall be
rounded to the next lowest multiple of $50.
(2) A tax is imposed for each taxable year upon the entire
taxable income of every part-year resident of this state. The
amount of the tax shall be computed under subsection (1) of this
section as if the part-year resident were a full-year resident
and shall be multiplied by the ratio provided under ORS 316.117
to determine the tax on income derived from sources within this
state.
(3) A tax is imposed for each taxable year on the taxable
income of every full-year nonresident that is derived from
sources within this state. The amount of the tax shall be
determined in accordance with the table set forth in subsection
(1) of this section.
SECTION 2. ORS 316.695 is amended to read:
316.695. (1) In addition to the modifications to federal
taxable income contained in this chapter, there shall be added to
or subtracted from federal taxable income:
(a) If, in computing federal income tax for a taxable year, the
taxpayer deducted itemized deductions, as defined in section
63(d) of the Internal Revenue Code, the taxpayer shall add the
amount of itemized deductions deducted (the itemized deductions
less an amount, if any, by which the itemized deductions are
reduced under section 68 of the Internal Revenue Code).
(b) If, in computing federal income tax for a taxable year, the
taxpayer deducted the standard deduction, as defined in section
63(c) of the Internal Revenue Code, the taxpayer shall add the
amount of the standard deduction deducted.
(c)(A) From federal taxable income there shall be subtracted
the larger of (i) the taxpayer's itemized deductions or (ii) a
standard deduction. Except as provided in subsection (9) of this
section, for purposes of this subparagraph, 'standard deduction '
means the sum of the basic standard deduction and the additional
standard deduction.
(B) For purposes of subparagraph (A) of this paragraph, the
basic standard deduction is:
(i) { - $3,000 - } { + $6,000 + }, in the case of joint
return filers or a surviving spouse;
(ii) { - $1,800 - } { + $3,600 + }, in the case of an
individual who is not a married individual and is not a surviving
spouse;
(iii) { - $1,500 - } { + $3,000 + }, in the case of a
married individual who files a separate return; or
(iv) { - $2,640 - } { + $5,280 + }, in the case of a head
of household.
(C) For purposes of subparagraph (A) of this paragraph, the
additional standard deduction is the sum of each additional
amount to which the taxpayer is entitled under subsection (8) of
this section.
(D) As used in subparagraph (B) of this paragraph, ' surviving
spouse' and 'head of household' have the meaning given those
terms in section 2 of the Internal Revenue Code.
(E) In the case of the following, the standard deduction
referred to in subparagraph (A) of this paragraph shall be zero:
(i) A husband or wife filing a separate return where the other
spouse has claimed itemized deductions under subparagraph (A) of
this paragraph;
(ii) A nonresident alien individual;
(iii) An individual making a return for a period of less than
12 months on account of a change in his or her annual accounting
period;
(iv) An estate or trust;
(v) A common trust fund; or
(vi) A partnership.
(d) For the purposes of paragraph (c)(A) of this subsection,
the taxpayer's itemized deductions are the sum of:
(A) The taxpayer's itemized deductions as defined in section
63(d) of the Internal Revenue Code (reduced, if applicable, as
described under section 68 of the Internal Revenue Code) plus any
amount of medical deduction disallowed under section 213(f) of
the Internal Revenue Code and minus the deduction for Oregon
income tax (reduced, if applicable, by the proportion that the
reduction in federal itemized deductions resulting from section
68 of the Internal Revenue Code bears to the amount of federal
itemized deductions as defined for purposes of section 68 of the
Internal Revenue Code); and
(B) The amount that may be taken into account under section
213(a) of the Internal Revenue Code, not to exceed seven and
one-half percent of the federal adjusted gross income of the
taxpayer, if the taxpayer has attained the following age before
the close of the taxable year, or, in the case of a joint return,
if either taxpayer has attained the following age before the
close of the taxable year:
(i) For taxable years beginning on or after January 1, 1991,
and before January 1, 1993, a taxpayer must attain 58 years of
age before the close of the taxable year.
(ii) For taxable years beginning on or after January 1, 1993,
and before January 1, 1995, a taxpayer must attain 59 years of
age before the close of the taxable year.
(iii) For taxable years beginning on or after January 1, 1995,
and before January 1, 1997, a taxpayer must attain 60 years of
age before the close of the taxable year.
(iv) For taxable years beginning on or after January 1, 1997,
and before January 1, 1999, a taxpayer must attain 61 years of
age before the close of the taxable year.
(v) For taxable years beginning on or after January 1, 1999, a
taxpayer must attain 62 years of age before the close of the
taxable year.
(2)(a) There shall be subtracted from federal taxable income
any portion of the distribution of a pension, profit-sharing,
stock bonus or other retirement plan, representing that portion
of contributions which were taxed by the State of Oregon but not
taxed by the Federal Government under laws in effect for tax
years beginning prior to January 1, 1969, or for any subsequent
year in which the amount that was contributed to the plan under
the Internal Revenue Code was greater than the amount allowed
under this chapter.
(b) Interest or other earnings on any excess contributions of a
pension, profit-sharing, stock bonus or other retirement plan not
permitted to be deducted under paragraph (a) of this subsection
shall not be added to federal taxable income in the year earned
by the plan and shall not be subtracted from federal taxable
income in the year received by the taxpayer.
(3)(a) Except as provided in paragraph (b) of this subsection
and subsections (4) and (5) of this section, in addition to the
adjustments to federal taxable income required by ORS 316.680,
there shall be added to federal taxable income the amount of any
federal income taxes in excess of $3,000, accrued by the taxpayer
during the taxable year as described in ORS 316.685, less the
amount of any refund of federal taxes previously accrued for
which a tax benefit was received.
(b) In the case of a husband and wife filing separate tax
returns, the amount added shall be in the amount of any federal
income taxes in excess of $1,500, less the amount of any refund
of federal taxes previously accrued for which a tax benefit was
received.
(4)(a) If federal income taxes are paid or determined, due to
additional assessments as described in ORS 316.685 (2), on income
for a taxable year beginning on or before December 31, 1986,
there shall be added to federal taxable income that portion of
the federal income tax due to additional assessments which, when
added to federal income tax previously paid and deducted for that
prior taxable year on the taxpayer's Oregon return, exceeds
$7,000.
(b) In the case of a husband and wife filing separate tax
returns, the amount to be added to federal taxable income under
this subsection shall be that portion of the federal income tax
due to additional assessments which, when added to federal income
tax previously paid and deducted for that prior year on the
taxpayer's Oregon return, exceeds $3,500.
(5)(a) In addition to the adjustments required by ORS 316.130,
a full-year nonresident individual shall add to taxable income a
proportion of any accrued federal income taxes as computed under
ORS 316.685 in excess of $3,000, or $7,000 if subsection (4)(a)
of this section is applicable, in the proportion provided in ORS
316.117.
(b) In the case of a husband and wife filing separate tax
returns, the amount added under this subsection shall be computed
in a manner consistent with the computation of the amount to be
added in the case of a husband and wife filing separate returns
under subsection (3) or (4) of this section, whichever is
applicable. The method of computation shall be determined by the
Department of Revenue by rule.
(6) Subsection (3)(b), subsection (4)(b) and subsection (5)(b)
of this section shall not apply to married individuals living
apart as defined in section 7703(b) of the Internal Revenue Code.
(7)(a) For tax years beginning on or after January 1, 1981, and
prior to January 1, 1983, income or loss taken into account in
determining federal taxable income by a shareholder of an S
corporation pursuant to sections 1373 to 1375 of the Internal
Revenue Code shall be adjusted for purposes of determining Oregon
taxable income, to the extent that as income or loss of the S
corporation, they were required to be adjusted under the
provisions of ORS chapter 317.
(b) For tax years beginning on or after January 1, 1983, items
of income, loss or deduction taken into account in determining
federal taxable income by a shareholder of an S corporation
pursuant to sections 1366 to 1368 of the Internal Revenue Code
shall be adjusted for purposes of determining Oregon taxable
income, to the extent that as items of income, loss or deduction
of the shareholder the items are required to be adjusted under
the provisions of this chapter.
(c) The tax years referred to in paragraphs (a) and (b) of this
subsection are those of the S corporation.
(d) As used in paragraph (a) of this subsection, an S
corporation refers to an electing small business corporation.
(8)(a) The taxpayer shall be entitled to an additional amount,
as referred to in subsection (1)(c)(A) and (C) of this section,
of { - $1,000 - } { + $2,000 + }:
(A) For himself or herself if he or she has attained age 65
before the close of his or her taxable year; and
(B) For the spouse of the taxpayer if the spouse has attained
age 65 before the close of the taxable year and an additional
exemption is allowable to the taxpayer for such spouse for
federal income tax purposes under section 151(b) of the Internal
Revenue Code.
(b) The taxpayer shall be entitled to an additional amount, as
referred to in subsection (1)(c)(A) and (C) of this section, of
{ - $1,000 - } { + $2,000 + }:
(A) For himself or herself if he or she is blind at the close
of the taxable year; and
(B) For the spouse of the taxpayer if the spouse is blind as of
the close of the taxable year and an additional exemption is
allowable to the taxpayer for such spouse for federal income tax
purposes under section 151(b) of the Internal Revenue Code. For
purposes of this subparagraph, if the spouse dies during the
taxable year, the determination of whether such spouse is blind
shall be made immediately prior to death.
(c) In the case of an individual who is not married and is not
a surviving spouse, paragraphs (a) and (b) of this subsection
shall be applied by substituting ' { - $1,200 - }
{ + $2,400 + } ' for ' { - $1,000 - } { + $2,000 + }. '
(d) For purposes of this subsection, an individual is blind
only if his or her central visual acuity does not exceed 20/200
in the better eye with correcting lenses, or if his or her visual
acuity is greater than 20/200 but is accompanied by a limitation
in the fields of vision such that the widest diameter of the
visual field subtends an angle no greater than 20 degrees.
(9) In the case of an individual with respect to whom a
deduction under section 151 of the Internal Revenue Code is
allowable for federal income tax purposes to another taxpayer for
a taxable year beginning in the calendar year in which the
individual's taxable year begins, the basic standard deduction
(referred to in subsection (1)(c)(B) of this section) applicable
to such individual for such individual's taxable year shall not
exceed the greater of:
(a) { - $500 - } { + $1,000 + }; or
(b) The individual's earned income.
SECTION 3. ORS 317.061 is amended to read:
317.061. The rate of the tax imposed by and computed under this
chapter is { - six and six-tenths percent. - } { + as set
forth in the following table: + }
_________________________________________________________________
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
If Oregon taxable + }
{ + income is: The tax is: + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
Not over $50,000. 6.6% of + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
Oregon
taxable
income
Over $50,000 but not + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
over $100,000.... $3,300 plus 7.6% + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
of the excess
over $50,000
Over $100,000 but not + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
over $300,000.... $7,100 plus 8.6% + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
of the excess
over $100,000
Over $300,000 but not + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
over $1,000,000.. $24,300 plus 9.6% + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
of the excess
over $300,000 + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
Over $1,000,000.. $91,500 plus 10.6% + }
____NOTE_TO_GOPHER_CUSTOMERS:__________________________________
THE FOLLOWING TABULAR TEXT MAY BE IRREGULAR.
FOR COMPLETE INFORMATION PLEASE SEE THE PRINTED MEASURE.
_______________________________________________________________
{ +
of the excess
over $1,000,000 + }
_________________________________________________________________
____________________________________________________________
END OF POSSIBLE IRREGULAR TABULAR TEXT
____________________________________________________________
SECTION 4. { + The amendments to ORS 316.037, 316.695 and
317.061 by sections 1 to 3 of this Act apply to tax years
beginning on or after January 1, 1996. + }
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