Credit for the Gain on the Sale of a Residence Taxed by Another State

A credit will be allowed if the gain on the sale of a taxpayer’s personal residence is taxed by both Oregon and another state or country. The credit is the lesser of:

(1) Mutually taxed gain: [See PDF link below.]; or

(2) 8 percent of the gain taxed by the other state. Mutually taxed gain is the total gain reduced by any allowable deductions or exclusions (i.e., capital gains deduction, differences in allowable depreciation due to business use of home, etc.). Total income on other state’s return is the other state’s taxable income before subtractions for itemized deductions (or standard deduction) and exemptions. To claim the credit, the taxpayer must send a copy of the other state or country’s return and proof of payment. A taxpayer may not claim both this credit and a credit under ORS 316.082 or 316.131 for taxes paid on the same gain.

[ED. NOTE: To view attachments referenced in rule text, click here to view rule.]