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reduced tax rate and his amended return will be treated as reported on line c of the federal Form 1065, line b of federal
the original return. Form 1120S, or line b of federal Schedules C or F.
Example 6: Maggie filed her original return on March 12, Entity type. Enter the appropriate code for how the business
2023, and didn’t elect the reduced tax rate or file an exten- files for tax purposes: SP for a sole proprietorship, SC for
sion. She files an amended return on May 4, 2023, and elects an S corporation, or Pfor a partnership. Don’t enter LLC or
the reduced tax rate. The reduced tax rate will be denied anything other than the codes listed.
since the amended return was filed after the original due
Column (a). Enter nonpassive losses attributable to the
date of April 18, 2023, and she did not file an extension.
qualifying sole proprietorship, partnership, or S corporation.
Example 7: Sam filed his original return on a timely filed Include qualifying nonpassive losses such as IRC Section
extension on May 12, 2023, and elects the reduced tax rate. 1231 losses treated as ordinary losses.
The reduced tax rate election will be allowed because it was
Column (b). For partnerships and S corporations only.
made on his original return.
Enter Section 179 expense deduction you reported in Part
Example 8: Allen filed his original return on a timely filed II, Section 28, column (i) of your federal Schedule E attribut-
extension on May 3, 2023, and didn’t elect the reduced tax able to the qualifying partnership or S corporation. Don’t
rate. He files an amended return on July 1, 2023 and makes complete this column for sole proprietorships.
the election. His amended return will be accepted allowing
Column (c). Enter nonpassive income attributable to the
the reduced tax rate and his amended return will be treated
qualifying sole proprietorship, partnership, or S corporation.
as the original return for the reduced tax rate election.
Also include qualifying nonpassive income such as royalties,
If you claimed the reduced tax rate on your original return, guaranteed payments, and IRC Section 1231 gains treated
you must amend Schedule OR-PTE-FY if: as ordinary income. Don’t include passive income, capital
gains, interest income, wages, or dividends.
• An IRS audit (or other state audit) resulted in a change that
affects your Oregon return; Column (d). If you are not a member of an entity that elected
• You amended your federal (or other state) return and the to pay PTE-E, enter 0. Otherwise, if all of the ordinary busi-
changes you made affect your Oregon return; ness income passed through from the entity qualifies for this
• You have a net operating loss (NOL); or reduced tax rate, enter the amount from Schedule OR-K-1,
• You need to correct income or deductions you originally line 2. However, if not all of the ordinary business income
reported. passed through from the entity qualifies for this reduced
tax rate, use the federal Schedule K-1 (or Oregon Schedule
Note: If you amend after the due date for the return of April
OR-K-1) and Oregon Schedule OR-21-K-1 issued by the elect-
18, 2023 (or October 17, 2023, if filing on extension), you must
ing entity and this formula to determine the amount to enter
use the tax on line 12a of the Tax worksheet even if line 13a
on column (d):
is less.
Qualifying business income from electing entity
÷
Schedule instructions Ordinary business income from Schedule K-1, box 1
Use the following instructions to complete Schedule OR- ×
Addition from Schedule OR-21-K-1, line 2
PTE-FY. Complete the entire schedule and include it with
=
your Oregon Form OR-40.
Amount to claim on column (d)
Section A instructions See Form OR-21 Instructions and our website for information
about the PTE-E tax.
Complete a line for each qualifying sole proprietorship, part-
nership, or S corporation. Only list businesses that qualify. Line 6. Report the totals for columns (a), (b), and (c). If more
Use additional schedules if necessary and put the total from than one page is used, report the total of all pages.
all schedules on line 6 of the first page.
Line 9. If line 9 is 0 or less, you can’t use the reduced tax rate.
Note: You must list all nonpassive income (or loss) from Return to line 20 and complete the rest of Form OR-40. If line
qualifying sole proprietorships, partnerships, and S corpo- 9 is more than 0, enter the amount on line 2b of Section B.
rations for each individual making the election. You can’t
selectively choose which qualifying income (or losses) to Section B instructions
include in Section A.
The tax worksheet in Section B will help you calculate which
For each qualifying business, enter the business name, fed- tax rate is more beneficial to you. Complete each line to
eral employer identification number (FEIN), number of quali- determine your tax.
fying employees, business code number, and entity type.
Lines 4 and 7. Report only the depreciation modification
Business code number. Enter the business code number attributable to the qualifying sole proprietorships, partner-
(or North American Industry Classification System code) as ships, or S corporations listed in Section A.
150-101-365-1 (Rev. 08-30-22) 3 2022 Schedule OR-PTE-FY Instructions
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