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Schedule OR-LTEZ Instructions 2023
Long-term Enterprise Zone Facilities Credit
This publication is a guide, not a complete statement, of Oregon Revised Statutes (ORS) and Oregon Administrative
Rules (OAR). For more information, refer to the laws and rules at www.oregon.gov/dor.
the taxpayer is entitled. Tax credits allowable under this
Important section or any other provision of law creating a tax credit
against corporation excise or income tax, may not be used
If you're claiming the Long-Term Enterprise Zone Facili- to offset the first $1 million, or a lesser credit threshold
ties Credit for this tax year, you must submit the Schedule
amount that's allowed under ORS 317.124(7) of corporate
OR-LTEZ with your return. If you're eligible for the Long-
excise tax paid by the corporation to this state in any taxable
Term Enterprise Zone Facilities Credit for this tax year, but
year. The first $1 million paid or any lesser credit threshold
choose not to use it, you must also submit the Schedule OR-
amount that's allowed and paid includes taxes generally
LTEZ with your return.
attributable to operations of the taxpayer throughout the
state of Oregon.
What qualifies a business to claim this A taxpayer may forgo using a tax credit otherwise allowed
credit? under ORS 317.124 in order to use other tax credits in a tax
year (ORS 317.125).
A tax credit is available for subchapter C corporations (and
the shareholders of subchapter S corporations) that own a Note: Round all percentages to 4 digits to the right of the
facility that's exempt from property tax due to its location in decimal. For example, .1234567 becomes 12.3457%.
a rural enterprise zone.
The facility must be located in a county that satisfies speci- How is the credit claimed?
fied economic criteria at the time of approval by the written
agreement with the local zone sponsor. The credit is claimed on Schedule OR-ASC-CORP. S corpo-
ration shareholders may claim it on their personal returns
Receipt of the credit also depends on: on Schedule OR-ASC.
(i) Written approval by the governor; This tax credit may not be transferred to another taxpayer.
(ii) Local certification for exemption of the facility from
property taxes no later than June 30, 2018 (ORS
285C.406); and What happens if the credit exceeds the
(iii) Satisfaction of applicable requirements under ORS
tax?
285C.412 for the exemption.
A taxpayer claiming a credit against tax must claim the
full amount of any credit that's allowed for the tax year, to
What is the applicable law?
the extent of the tax liability. The credit cannot reduce mini-
ORS 317.124. mum tax.
The credit is limited to the tax liability for the tax year. Tax
How is the amount of credit determined? credit not used by the taxpayer in a particular tax year may
be carried forward and used by the taxpayer for a period of
The amount of the credit is equal to 62.5 percent of the up to five years.
taxpayer’s payroll and employee benefit costs, including
but not limited to workers’ compensation insurance and
payroll taxes, relating to the qualifying facility. The credit What evidence must be kept to verify
is available for a period of at least five, but not more than the claimed credit?
15 consecutive tax years. This period may commence only
after the facility is placed in service, but no later than the Include this form with your return and keep a copy with
tax year beginning in the third calendar year after the year your tax records. Upon audit or examination, a copy of this
in which the facility is placed in service. The tax credit may form may be requested by the department to verify the
be used to offset corporate excise or income tax levied or credit claimed.
imposed by the State of Oregon relating to the facility that's
Other evidence may be requested including, but not lim-
owned by the corporation.
ited to, annual gross payroll expenses at the facility, and
This credit isn't in lieu of any deduction for depreciation, local enterprise zone certification and qualification for the
amortization, payroll costs, or any other expense to which exemption on taxable property.
150-102-043-1 (Rev. 10-05-23) 1 2023 Schedule OR-LTEZ Instructions
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