Oregon Administrative Rules › Chapter 150 - DEPARTMENT OF REVENUE › Division 316 - PERSONAL INCOME TAX GENERAL PROVISIONS › Section 150-316-0400 - Resident and Nonresident Estates and Trusts

Current through Register Vol. 63, No. 7, July 1, 2024
(1) For the purposes of the taxes imposed
			 upon the income of estates and trusts and paid by the fiduciary thereof,
			 estates and trusts are classified as either resident or nonresident.
(2) An estate is a resident if the fiduciary
			 was appointed by an Oregon court or, where there is no appointment by an Oregon
			 court, if the administration is carried on in Oregon. An estate of a decedent
			 is but one taxable entity although there may be two or more fiduciaries
			 appointed by courts of two or more states or countries. In such a case, the
			 fiduciary appointed by the Oregon court (or administering the estate in Oregon)
			 is required to file an Oregon state income tax return and is liable for any
			 Oregon state income tax of the estate. The Oregon state income tax is
			 determined by the status of the principal administration as to its resident or
			 nonresident character, and shall be computed on an Oregon return required to be
			 filed by the fiduciary of the principal administration. If the principal
			 administration, considered without regard to other administrations, is an
			 Oregon resident estate, all income of the estate, including that of nonresident
			 fiduciaries, is taxable as that of an Oregon resident. If the principal
			 administration, considered without regard to other administrations, is a
			 nonresident of Oregon, the Oregon state income tax liability is to be computed
			 as that of a nonresident.
(3) A
			 trust is a resident if the fiduciary is a resident of Oregon or if it is
			 administered in Oregon.
(4) A
			 trust is a nonresident only if there is no Oregon resident trustee and the
			 administration is not carried on in Oregon. See ORS
			 316.307 and the rules thereunder
			 regarding treatment of nonresident trusts.
(5) If the trustee is a corporate fiduciary
			 engaged in interstate trust administration, the trust is considered to be a
			 resident of Oregon and the place of administration for that trust is considered
			 to be Oregon if the trustee conducts the major part of its administration of
			 the trust in Oregon. In this context, "administration" relates to fiduciary
			 decision making of the trust and not to the incidental execution of such
			 decisions. Incidental functions include, but are not limited to, preparing tax
			 returns, executing investment trades as directed by account officers and
			 portfolio managers, preparing and mailing trust accountings, and issuing
			 disbursements from trust accounts as directed by account officers.
Example 1
:
X Trust Company,
			 with its headquarters in Oregon, serves as trustee for trusts in Oregon and
			 Washington. For its Washington trusts, account officers with offices in
			 Washington:
(a) serve as X's primary contact
			 with beneficiaries,
(b) hire
			 lawyers, accountants, and other professionals for the trust, and
(c) make the majority of fiduciary decisions,
			 which include when to make distributions and where to invest trust assets.
			 Assets are invested in common trust funds or in mutual funds on the advice of
			 either an affiliate of X located in Oregon or by unaffiliated investment
			 companies located in Oregon or other states. A committee of X's senior
			 managers, including some stationed in Oregon, oversees the account officer's
			 activities. Various incidental functions for the Washington trusts are
			 performed by X's personnel in Oregon. Because the majority of the fiduciary
			 decisions for the Washington trusts are made in Washington, those trusts are
			 not administered in Oregon.