Oregon Administrative Rules › Chapter 150 - DEPARTMENT OF REVENUE › Division 267 - MASS TRANSIT DISTRICTS › Section 150-267-0020 - Wages Exempt From Transit Payroll Tax

Current through Register Vol. 63, No. 7, July 1, 2024
For purposes of the transit district payroll taxes, certain
				payrolls are exempted from taxation by exclusion of the amounts paid from the
				definition of wages. The following are clarifications of some of the allowable
				exemptions:
(1) All foreign insurance
			 companies (those formed under laws from other states), their adjusters, agents,
			 office support staff are specifically exempted by ORS
			 731.840. This exemption does not
			 extend to domestic insurers, health care contractors, and motorist service
			 clubs.
(2) ORS
			 267.380(2)(h)
			 states if remuneration is not subject to withholding under ORS Chapter 316 it
			 is not subject to the transit payroll tax. All wages paid for domestic service
			 described in 316.162(c) are exempt from withholding and transit payroll tax. If
			 the remuneration is not subject to withholding under ORS Chapter 316 such wages
			 would be exempt from the transit payroll tax but generally are subject to
			 transit self-employment tax. Unless a real estate agent meets all the
			 requirements of 316.209, the remuneration for services performed by that agent
			 will be subject to transit payroll taxes.
(3) ORS
			 267.380(4),
			 which subjects deferred compensation to transit tax, creates an exception to
			 the general rule stated in 267.380(2)(h), which exempts from transit tax
			 remuneration not subject to withholding tax.
(4) The exemption in ORS
			 267.380(2)(c)
			 applies to labor not in the course of the employer's trade or business. The
			 exemption does not apply to wages for substantial labor not in the regular
			 course of the employer's trade or business, such as the construction of a
			 private home where the owner is the employer.
(5) Transit payroll tax is imposed only on
			 that portion of the payroll paid with respect to duties performed by employees
			 within the District. If an employee performs services both inside and outside
			 the District, the employer shall prorate the wages paid to that particular
			 employee based upon the relative amounts of time worked by that employee within
			 and without the District.
(6) The
			 exemption in ORS 267.380(2)(e)
			 applies solely to seasonal labor in connection with the planting, cultivating
			 or harvesting of agricultural crops. Transit payroll tax applies to the entire
			 wages of "regular" farm employees even though, as a part of their duties, they
			 engage in planting, cultivating or harvesting.
(7) Certain state agencies are exempt from
			 transit payroll tax under the provisions of ORS
			 267.430.
(8) Internal Revenue Code Section 501(c)(3)
			 institutions (charitable and other nonprofit institutions) other than hospitals
			 are exempt from transit payroll taxes. For the purposes of ORS
			 267.380(2)(a),
			 a hospital is defined as:
(a) A permanent
			 facility or organization with facilities that include inpatient beds, and with
			 medical services, including physician services and continuous nursing services
			 under the supervision of registered nurses, to provide diagnosis and medical or
			 surgical treatment primarily for but not limited to acutely ill patients and
			 accident victims, or to provide treatment for the mentally ill.
(b) A hospital's parent or subsidiary
			 501(c)(3) organization that provides administrative and support functions to
			 the hospital.