​​Who has to file?

Corporations that are doing business in Oregon or have income from an Oregon source are required to file an excise or income tax​ return.
"Doing business" means being engaged in any profit-seeking activity in Oregon. A taxpayer having one or more of the following in this state is doing business in Oregon:
  • A stock of goods.
  • An office.
  • A place of business (other than an office) where affairs of the corporation are regularly conducted.
  • Employees or representatives providing services to customers as the primary business activity (such as accounting or personal services), or services incidental to the sale of tangible or intangible personal property (such as installation, inspection, maintenance, warranty, or repair of a product).
  • An economic presence through which the taxpayer regularly takes advantage of Oregon's economy to produce income.

Oregon-source income only

If you have tangible or intangible property or other assets being used in Oregon, any income you receive is Oregon-source income. Your company must file an Oregon Corporation Income Tax Return, Form OR-20-INC. There are exceptions to this requirement (Public Law 86-272).

Oregon jurisdiction

Any corporation with substantial nexus in Oregon, and not protected by Pub.L. 86-272, must pay Oregon excise or income taxes (OAR 150-317-0020). 


Nexus is a connection, tie, or link. The U.S. Constitution, through due process and commerce clauses, forbids states from imposing a tax unless nexus exists. Nexus ranges from very little connection to substantial connection with Oregon.   

Representational nexus

If your company receives a benefit from business conducted in Oregon, you might have nexus. For example, if you contract with independent representatives to provide services for your customers, such as repair or warranty work, the activities of those representatives establish nexus for your corporation. Also, if you lease property to a customer who brings it into Oregon, this establishes nexus for your corporation. 

Nexus-creating activities

Examples of activities that create nexus and a filing requirement in Oregon include:
Your company has:
  • A phone listing in Oregon.
  • A local Oregon phone number, even if calls are forwarded to your office outside of Oregon.
  • An office in Oregon.
Your company owns, rents, or leases:
  • Raw land.
  • Inventory or other goods in an Oregon warehouse during the year.
  • Vehicles used in Oregon, except those used by certain sales staff.
  • Equipment used in Oregon.
Your company:
  • Ships in-process inventory to any party in Oregon for processing.
  • Consigns goods for sale in Oregon.
  • Leases property to a party who uses it in Oregon.
  • Has any interest in partnerships, LLCs, or S-corporations operating in Oregon.
  • Holds title to Oregon property until contract price is paid.
  • Files a security interest in inventory in Oregon until it is sold.
  • Licenses trademarks to parties doing business in Oregon.
  • Regularly takes advantage of Oregon's economy to produce income.
  • Sells or licenses franchises to franchisees operating in Oregon.
  • Sells services in Oregon.
Your employees or representatives conduct activities in Oregon, such as:
  • Accept orders.
  • Check credit.
  • Accept deposits.
  • Handle credit disputes.
  • Collect delinquent accounts.
  • Repossess property.
  • Perform installation, repair or warranty services in Oregon.
  • Supervise or inspect installation.
  • Conduct training, seminars, etc., more than two times per year except for training sales people whose activities are protected under Pub.L. 86-272.
  • Provide engineering or design services for Oregon customers.
  • Handle customer complaints in Oregon.
  • Pick up defective products or returned property.
  • Telecommute from Oregon residences.
Third parties or agents perform these services on your behalf:
  • Fill orders from inventory.
  • Collect on accounts.
  • Check credit history of new Oregon customers.
  • Repossess property in Oregon.
  • Provide maintenance and warranty services in Oregon.
  • Close mortgage loans (for out-of-state financial organizations).
  • Service mortgage and consumer loans for out-of-state financial organization.

My company manufactures products that sales people sell in Oregon. Does this create a nexus?

Your company does business in Oregon, but federal law prohibits states from taxing out-of-state companies that only solicit sales of tangible personal property within the state (Title 15, USC 381). 

Public Law 86-272

Federal Public Law 86-272, enacted in 1959, limits a state’s right to tax out-of-state companies selling of tangible personal property. Get more information on PL 86-272.

Voluntary disclosure agreement

If your business isn't in compliance with Oregon tax laws, we encourage you to voluntarily come forward to register and pay prior tax obligations. Read more about how our Voluntary Disclosure Program can help resolve your prior tax liabilities.