Repatriated foreign income under Section 965 of the Internal Revenue Code
The federal tax reform act known as the "Tax Cuts and Jobs Act of 2017" included a one-time repatriation of deferred foreign income. This income, in the form of dividends from certain foreign corporations, was deemed distributed to shareholders in 2017 or 2018. The income must be reported even if it wasn't actually received during the tax year.
For individuals, this income is taxed at special federal rates. After the special rates are applied, a portion of the income is deducted, and the rest is included as "Other income" on the federal return. Oregon requires an addition for the deducted portion of the income.
Full-year residents. Report the deducted portion as an addition on Schedule OR-ASC. For tax year 2017, use code 162; for tax year 2018, use code 184.
Part-year residents and nonresidents. This income is taxable by Oregon if you were a resident at the time you were deemed to have received the distribution or if the income is from property employed in a business, trade, profession, or occupation carried on in Oregon when you were a nonresident. If you don't know the exact deemed distribution date, use any reasonable method to determine the amount of the deducted portion to include as an addition. Keep a statement with your tax records showing how this amount was determined. Report the addition on Schedule OR-ASC-NP using code 162 for the 2017 tax year and code 184 for the 2018 tax year.
Penalty or interest waiver
If you were charged penalty or interest solely due to repatriated foreign income, submit a written waiver request to the department. Instead of the waiver criteria, refer to section 7 of Senate Bill 851 (2019).