CHAPTER 12 BUSINESS INCOME TAX

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					                        CHAPTER 12: BUSINESS INCOME TAX
§§:

§ 12.005   Title.                                       § 12.005      TITLE.
§ 12.010   Taxes For Revenue.
§ 12.020   Conformity To State Income Tax Laws.          This chapter is known and cited as the Mult-
§ 12.100   Definitions.                               nomah County Business Income Tax Law.
                                                      (Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
§ 12.200   Administration.
                                                      num11.500&Amd, 08/19/2004; ‘ 90 Code, § 5.60.005,
§ 12.210   Administrative Authority.                  07/01/1998; Ord. 768, passed, 06/24/1993)
§ 12.220   Presumption Of Doing Business.
§ 12.225   Ownership Of Taxfiler Information.         § 12.010        TAXES FOR REVENUE.
§ 12.230   Confidentiality.
§ 12.240   Persons To Whom Information May Be              The Board of the County Commissioners finds
           Furnished.                                 it is necessary to raise additional revenues to pro-
                                                      vide those county services required for the health,
§ 12.250   Taxfiler Representation.
                                                      safety and welfare of the people of the county. The
§ 12.255   Representation Restrictions.
                                                      purpose of the taxes imposed by this chapter is to
§ 12.260   Information Request, Examination Of
                                                      raise funds to provide those services within the
           Books, Records Or Persons.                 county. All proceeds collected under this chapter are
§ 12.270   Records.                                   general fund revenue. This chapter is intended to es-
§ 12.280   Deficiencies And Refunds.                  tablish a unified system for collection and allocation
§ 12.290   Protests And Appeals.                      of taxes based upon business net income by the
§ 12.400   Exemptions.                                county and by cities within the county.
§ 12.500   Imposition And Rate Of Tax.                (Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
                                                      num11.501&Amd, 08/19/2004; ‘ 90 Code, § 5.60.010,
§ 12.510   Return Due Date.
                                                      07/01/1998; Ord. 779, passed, 12/09/1993; Ord. 768, passed,
§ 12.520   Quarterly Estimates.                       06/24/1993)
§ 12.530   Schedule For Payment Of Estimated
           Tax.                                       § 12.020        CONFORMITY TO STATE
§ 12.545   Tax Return.                                                INCOME TAX LAWS.
§ 12.550   Presumptive Tax.
§ 12.560   Payment Plan Fee.                              The Business Income Tax Law is construed in
                                                      conformity with the laws and regulations of the state
§ 12.600   Income Determinations.
                                                      imposing taxes on or measured by net income as
§ 12.610   Apportionment Of Income.
                                                      those laws existed for that particular tax year. The
§ 12.615   Business Retention Credit for Investment
                                                      Administrator has the authority by written policy, to
           Management Firms.                          connect to or disconnect from any legislative en-
§ 12.620   Changes To Federal Or State Tax            actment that deals with income or excise taxation or
           Returns.                                   the definition of income. Should a question arise
§ 12.700   Penalty.                                   under the Business Income Tax Law on which this
§ 12.710   Interest.                                  chapter is silent, the Administrator may look to the
§ 12.715   Payments Applied.                          laws of the State of Oregon for guidance in resolv-
§ 12.720   Interest On Refunds.                       ing the question, provided that the determination
§ 12.730   Criminal Penalties.                        under state law is not in conflict with any provision
§ 12.805   Severability.                              of this chapter or the state law is otherwise inappli-
§ 12.815   Operative Date.                            cable.
                                                      (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
§ 12.840   Frivolous Filing.                          12/20/2007; Ord. 1046, Renum11.502&Amd, 08/19/2004; ‘ 90
§ 12.850   Hacking.                                   Code, § 5.60.020, 07/01/1998; Ord. 897, passed, 01/08/1998;
§ 12.990   Participation Of Cities.                   Ord. 768, passed, 06/24/1993)
§ 12.995   Former Regulations Superseded By This
           Subchapter; Exceptions.
2                  Multnomah County – Chapter 12 - Business Income Tax


§ 12.100      DEFINITIONS.                                    EMPLOYEE. Any individual who performs
                                                          services for another individual or organization and
    The terms used in this chapter are defined as         whose compensation is reported by an IRS Form W-
provided in this chapter or in Administrative Rules,      2.
adopted under § 12.210 of this chapter, unless the
context requires otherwise.                                   INCOME. The net income arising from any
                                                          business, as reportable to the State of Oregon (State)
   ADMINISTRATOR. The City of Portland                    for personal income, corporation excise, or income
Revenue Bureau along with its employees and               tax purposes, before any allocation or apportion-
agents.                                                   ment for operation out of state, or deduction for a
                                                          net operating loss carry-forward or carry-back.
    APPEALS BOARD. The hearings body desig-
nated by the Board to review taxfiler appeals from             (A) Partnerships, S corporations, limited liabil-
final determinations by the Administrator.                ity companies, limited liability partnerships, family
                                                          limited partnerships, estates, trusts and joint ven-
    BUSINESS. An enterprise, activity, profession         tures (including tenants-in-common arrangements)
or undertaking of any nature, whether related or un-      are liable for the business tax and not the individual
related, by a person in the pursuit of profit, gain or    partners, shareholders, members, beneficiaries or
the production of income, including services per-         owners. The income of these entities must include
formed by an individual for remuneration, but does        all income received by the entity including ordinary
not include wages earned as an employee.                  income, interest and dividend income, income from
                                                          sales of business assets and other income attribut-
     CONTROLLING SHAREHOLDER. Any per-                    able to the entity.
son, alone or together with that person's spouse,
parents, and/or children, who, directly or indirectly,        (B) If one or more persons are required or elect
owns more than 5% of any class of outstanding             to report their income to the State for corporation
stock or securities of the taxfiler. The term CON-        excise or income tax purposes or personal income
TROLLING SHAREHOLDER may mean the con-                    tax purposes in a consolidated, combined or joint re-
trolling shareholder individually or in the aggregate.    turn, a single return must be filed by the person fil-
                                                          ing such return. In such cases, INCOME means the
    DAY. A calendar day unless otherwise noted.           net income of the consolidated, combined or joint
                                                          group of taxfilers before any allocation or appoint-
     DIRECTOR. Multnomah County Chief Finan-              ment for operation out of the state, or deduction for
cial Officer.                                             a net operating loss carrying-forward or carry-back.

   DIVISION. The Finance and Risk Management                   (C) The absence of report income to the Internal
Division of the county.                                   Revenue Service or the State does not limit the abil-
                                                          ity of the Administrator to determine the correct in-
     DOING BUSINESS. To engage in any activity            come of the taxfiler through examination under §
in pursuit of profit or gain, including but not limited   12.260 of this chapter.
to, any transaction involving the holding, sale, rental
or lease of property, the manufacture or sale of              INDIVIDUAL. A natural person.
goods or the sale or rendering of services other than
as an employee. Doing business includes activities            INVESTMENT MANAGEMENT FIRM. A
carried on by a person through officers, agents or        taxfiler entitled to receive a credit against the City
employees as well as activities carried on by a per-      of Portland business license tax pursuant to Portland
son on his or her own behalf.                             City Code Section 7.02.870.




(S-1 2010)
                                   Chapter 12 - Business Income Tax                                                       3


    NET OPERATING LOSS. The negative tax-                   § 12.200        ADMINISTRATION.
able income that may result after the deductions al-
lowed by the Business Income Tax Law in deter-                   (A) The City of Portland, Revenue Bureau is the
mining net income for the tax year.                         Administrator of record and has the authority to ad-
                                                            minister and enforce this chapter effective January
     NONBUSINESS INCOME. Income not created                 1, 1994 to include, but not limited to, administrative
in the course of the taxfiler's business activities.        return processing, auditing, determinations, collec-
                                                            tion of taxes, penalties and interest (including insti-
     NOTICE. A written document mailed first class          tuting legal action in any court of competent juris-
by the Administrator or division to the last known          diction by or on behalf of the Division or Adminis-
address of a taxfiler as provided to the Administra-        trator), protests and appeals that occur on or after
tor or division in the latest tax return on file with the   January 1, 1994.
Administrator.
                                                                (B) The Administrator has access to and main-
     OWNERSHIP OF OUTSTANDING STOCK                         tains all tax filings and records, under this chapter,
OR SECURITIES. The incidents of ownership                   on behalf of the county. The Administrator may,
which include the power to vote on the corporation's        upon request, interpret how this chapter applies, in
business affairs or the power to vote for the direc-        general or for a certain set of circumstances. Noth-
tors, officers, operators or other managers of the tax-     ing in this chapter precludes the informal disposition
filer.                                                      of controversy by stipulation or agreed settlement,
                                                            through correspondence or a conference with the
     PERSON. Includes, but is not limited to a natu-        Administrator.
ral person, proprietorship, partnership, limited part-      (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
nership, family limited partnerships, joint venture         12/20/2007; Ord. 1072, Amended, 03/30/2006; Ord. 1046, Re-
                                                            num11.506&Amd, 08/19/2004; ‘ 90 Code, § 5.60.200,
(including tenants-in-common arrangements), asso-           07/01/1998; Ord. 897, passed, 01/08/1998; Ord. 779, passed,
ciation, cooperative, trust, estate, corporation, per-      12/09/1993; Ord. 768, passed, 06/24/1993)
sonal holding company, limited liability company,
limited liability partnership or any other form of or-      § 12.210        ADMINISTRATIVE
ganization for doing business.                                              AUTHORITY.

    RECEIVED. The postmark date affixed by the                  (A) The Administrator may implement proce-
United States postal service if mailed or the date          dures, forms, and written policies for administering
stamp if delivered by hand or sent by facsimile or          the provisions of the Business Income Tax Law.
the receipt date from the online file and pay applica-
tion confirmation notice.                                        (B) The Administrator may adopt rules relating
                                                            to matters within the scope of this chapter to admin-
    TAX YEAR. The taxable year of a person for              ister compliance with the Business Income Tax
federal or state income tax purposes.                       Law.

    TAXFILER. A person doing business in the                     (C) Before adopting a new rule, the Administra-
county and required to file a return under the Busi-        tor must hold a public hearing. Prior to the hearing,
ness Income Tax Law.                                        the Administrator will publish a notice in a newspa-
(Ord. 1154, Amended, 02/11/2010; Ord. 1142, Amended,        per of general circulation in the county. The notice
07/16/2009; Ord. 1104, Amended, 12/20/2007; Ord. 1068,
                                                            must be published not less than ten nor more than 30
Amended, 10/13/2005; Ord. 1046, Renum11.504&Amd,
08/19/2004; ‘ 90 Code, § 5.60.100, 07/01/1998; Ord. 897,    days before the hearing; and it must include the
passed, 01/08/1998; Ord. 768, passed, 06/24/1993)           place, time and purpose of the public hearing, a
                                                            brief description of the subjects covered by the pro-
                                                            posed rule, and the location where copies of the full
                                                            text of the proposed rule may be obtained.



                                                                                                           (S-1 2010)
4                     Multnomah County – Chapter 12 - Business Income Tax


    (D) At the public hearing, the Administrator, or          wise exempted in this chapter. Property may be per-
designee, will receive oral and written testimony             sonal, including intangible, or real in nature; or
concerning the proposed rule. The Administrator
will either adopt the proposed rule, modify it, or re-           (E) Engaging in any activity in pursuit of gain
ject it, taking into consideration the testimony re-          which is not otherwise exempted in this chapter.
ceived during the public hearing. If a substantial            (Ord. 1046, Renum11.503&Amd, 08/19/2004; ‘ 90 Code, §
modification is made, additional public review will           5.60.030, 07/01/1998; Ord. 897, passed, 01/08/1998; Ord. 768,
                                                              passed, 06/24/1993)
be conducted, but no additional public notice is re-
quired if an announcement is made at the hearing of           § 12.225        OWNERSHIP OF TAXFILER
a future hearing for a date, time and place certain at                        INFORMATION.
which the modification will be discussed. Unless
otherwise stated, all rules are effective upon adop-               The county is the sole owner of all filer infor-
tion by the Administrator. All rules adopted by the           mation under the authority of this chapter. The Di-
Administrator will be filed in the division's office.         rector or the director's designee has access to all tax-
Copies of all current rules will be made available to         filer information at all times.
the public upon request.                                      (Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
                                                              num11.508&Amd, 08/19/2004; ‘ 90 Code, § 5.60.220,
     (E) Notwithstanding subsections (C) and (D) ,            07/01/1998; Ord. 768, passed, 06/24/1993)
the Administrator may adopt an interim rule without
prior public notice upon a finding that failure to act        § 12.230        CONFIDENTIALITY.
promptly will result in serious prejudice to the pub-
lic interest or the interest of the affected parties, stat-       Except as provided in this chapter or otherwise
ing the specific reasons for such prejudice. Any in-          required by law, it is unlawful for the division or the
terim rule adopted pursuant to this subsection is ef-         Administrator, or any elected official, employee, or
fective for a period of not longer than 180 days.             agent of the county, or for any person who has ac-
(Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-               quired information pursuant to § 12.240(A) and (C)
num11.507&Amd, 08/19/2004; ‘ 90 Code, § 5.60.210,             to divulge, release, or make known in any manner
07/01/1998; Ord. 779, passed, 12/09/1993; Ord. 768, passed,   any financial information submitted or disclosed to
06/24/1993)
                                                              the county under the terms of the Business Income
                                                              Tax Law. Nothing in this section should be con-
§ 12.220        PRESUMPTION OF DOING
                                                              strued to prohibit:
                BUSINESS.
                                                                  (A) The disclosure of the names and addresses
    A person is presumed to be doing business in
                                                              of any persons who have a tax account with the
the county and subject to this chapter if engaged in
                                                              Administrator;
any of the following activities:
                                                                  (B) The disclosure of general statistics in a form
    (A) Advertising or otherwise professing to be
                                                              which would prevent the identification of financial
doing business within the county;
                                                              information regarding an individual taxfiler;
    (B) Delivering goods or providing services to
                                                                  (C) The filing of any legal action by or on be-
customers within the county;
                                                              half of the Division or Administrator to obtain pay-
                                                              ment on unpaid accounts or the disclosure of infor-
    (C) Owning, leasing or renting personal or real
                                                              mation necessary to do so; or
property within the county which is used in a trade
or business;
                                                                  (D) The assignment to an outside collection
                                                              agency of any unpaid account balance receivable
    (D) Engaging in any transaction involving the
                                                              provided that the Division or Administrator notifies
production of income from holding property or the
                                                              the taxfiler of the unpaid balance at least 60 days
gain from the sale of property, which is not other-

(S-1 2010)
                                   Chapter 12 - Business Income Tax                                               5


prior to the assignment of the claim. Any assign-             closure or access necessary for the performance of
ment to an outside collection agency is subject to a          the duties of advising or representing the division.
reasonable collection fee, above and beyond any
amount owed to the County.                                            (2) The City Attorney, his or her assistants
(Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,          and employees, or other legal representatives of the
12/20/2007; Ord. 1072, Amended, 03/30/2006; Ord. 1046, Re-    City, to the extent the Administrator deems disclo-
num11.509&Amd, 08/19/2004; ‘ 90 Code, § 5.60.230,
07/01/1998; Ord. 779, passed, 12/09/1993; Ord. 768, passed,
                                                              sure or access necessary for the performance of the
06/24/1993)                                                   duties of advising or representing the Administrator,
                                                              including but not limited to instituting legal actions
§ 12.240        PERSONS TO WHOM                               on unpaid accounts.
                INFORMATION MAY BE
                FURNISHED.                                            (3) Other county employees and agents, to
                                                              the extent the division deems disclosure or access
    (A) The division or Administrator may disclose            necessary for such employees or agents to perform
and give access to information described in § 12.230          their duties under contracts or agreements between
to an authorized representative of the Department of          the division and any other department, division,
Revenue, State of Oregon, or of any local govern-             agency or subdivision of the county relating to the
ment of the state imposing taxes upon or measured             administration of the Business Income Tax Law.
by gross receipts or net income, for the following
purposes:                                                              (4) City of Portland employees, agents and
                                                              officials of the City, to the extent the Administrator
          (1) To inspect the tax return of any taxfiler;      deems disclosure or access necessary for such em-
                                                              ployees, agents or officials to:
          (2) To obtain an abstract or copy of the tax
return;                                                                  (a) Aid in any legal collection effort on
                                                              unpaid accounts;
        (3) To obtain information concerning any
item contained in any return; or                                          (b) Perform their duties under contracts
                                                              or agreements between the Administrator and any
         (4) To obtain information of any financial           other department, bureau, agency or subdivision of
audit of the tax returns of any taxfiler.                     the City relating to the administration of the Busi-
                                                              ness Income Tax Law; or
        Such disclosure and access will be granted
only if the laws, regulations or practices of such                         (c) Aid in determining whether a Busi-
other jurisdiction maintain the confidentiality of            ness Income Tax account is in compliance with all
such information at least to the extent provided by           City, State and Federal laws or policies.
the Business Income Tax Law.
                                                                  (D) All employees and agents of the division or
    (B) Upon request of a taxfiler, or authorized             county, prior to the performance of duties involving
representative, the Administrator will provide copies         access to financial information submitted to the
of any tax return information filed by the taxfiler in        county under the terms of the Business Income Tax
the Administrator's possession.                               Law, must be advised in writing of the provision of
                                                              § 12.730 relating to penalties for the violation of §§
    (C) The division or Administrator may also dis-           12.230 and 12.255. Such employees and agents
close and give access to information described in §           must execute a certificate in a form prescribed by
12.230 to:                                                    the division, stating that the person has reviewed
                                                              these provisions of law, has had them explained, and
        (1) The County Attorney, his or her assis-            is aware of the penalties for the violation of §§
tants and employees, or other legal representatives           12.230 and 12.255.
of the County, to the extent the division deems dis-


                                                                                                        (S-1 2010)
6                    Multnomah County – Chapter 12 - Business Income Tax


     (E) Prior to any disclosures permitted by this           member or the member's firm.
section, all persons described in subsection (A), to          (Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
whom disclosure or access to financial information            num11.512&Amd, 08/19/2004; ‘ 90 Code, § 5.60.255,
                                                              07/01/1998; Ord. 779, passed, 12/09/1993; Ord. 768, passed,
is given, must:                                               06/24/1993)

        (1) Be advised in writing of the provisions           § 12.260        INFORMATION REQUEST,
of § 12.730 relating to penalties for the violation of                        EXAMINATION OF BOOKS,
§ 12.230; and                                                                 RECORDS OR PERSONS.

        (2) Execute a certificate in a form pre-                  (A) The Administrator may request information
scribed by the division, stating these provisions of          or examine any books, papers, records, or memo-
law have been reviewed and they are aware of the              randa, including state and federal income or excise
penalties for the violation of § 12.230.                      tax returns, to ascertain the correctness of any tax
                                                              return or to make an estimate of any tax. The Ad-
     (F) The director's signature on the certificate,         ministrator has the authority, after notice, to:
required by subsection (E)(2), will constitute con-
sent to disclosure to the persons executing the cer-                  (1) Require the attendance of any person
tificate.                                                     required to file a tax return under the Business In-
(Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
                                                              come Tax Law, or officers, agents, or other persons
12/20/2007; Ord. 1046, Renum11.510&Amd, 08/19/2004; ‘ 90
Code, § 5.60.240, 07/01/1998; Ord. 768, passed, 06/24/1993)   with knowledge of the person's business operations,
                                                              at any reasonable time and place the Administrator
§ 12.250        TAXFILER REPRESENTATION.                      may designate;

    No person will be recognized as representing                       (2) Take testimony, with or without the
any taxfiler in regard to any matter relating to the          power to administer oaths to any person required to
tax of such taxfiler without written authorization of         be in attendance;
the taxfiler or unless the Administrator determines
from other available information the person has au-                   (3) Require proof for the information
thority to represent the taxfiler.                            sought, necessary to carry out the provisions of this
(Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-               chapter; and
num11.511&Amd, 08/19/2004; ‘ 90 Code, § 5.60.250,
07/01/1998; Ord. 768, passed, 06/24/1993)                              (4) Require the property manager of a ten-
                                                              ants-in-common arrangement to provide financial
§ 12.255        REPRESENTATION
                                                              information related to the arrangement as well as in-
                RESTRICTIONS.
                                                              formation regarding the owners, including, but not
                                                              limited to, the name and last known addresses of the
    (A) No employee or official of the county, the
                                                              owners.
Administrator, any public agency authorized to col-
lect taxes imposed by this chapter, may represent
                                                                   (B) The Administrator will designate the em-
any taxfiler in any matter before the Administrator.
                                                              ployees who will have the power to administer oaths
This restriction against taxfiler representation will
                                                              hereunder. Such employees must be notaries public
continue for two years after termination of employ-
                                                              of the State of Oregon.
ment or official status.                                      (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
                                                              12/20/2007; Ord. 1046, Renum11.513&Amd, 08/19/2004; ‘ 90
     (B) Members of the appeals board must not rep-           Code, § 5.60.260, 07/01/1998; Ord. 768, passed, 06/24/1993)
resent a taxfiler before the appeals board. No mem-
ber of the appeals board may participate in any mat-
ter before the board if the appellant is a client of the



(S-1 2010)
                                   Chapter 12 - Business Income Tax                                               7


§ 12.270        RECORDS.                                      § 12.290      PROTESTS AND APPEALS.

     Every person required to file a return under the              (A) Any determination by the Administrator
Business Income Tax Law must keep and preserve                may be protested by the taxfiler. Written notice of
for not less than seven years such documents and              the protest must be received by the Administrator
records, including state and federal income and ex-           within 30 days after the Administrator mailed or de-
cise tax returns, accurately supporting the informa-          livered the notice of determination to the taxfiler.
tion reported on the taxfiler's return and calculation        The protest must state the name and address of the
of tax for each year.                                         taxfiler and an explanation of the grounds for the
(Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-               protest. The Administrator must respond within 30
num11.514&Amd, 08/19/2004; ‘ 90 Code, § 5.60.270,             days after the protest is filed with either a revised
07/01/1998; Ord. 768, passed, 06/24/1993)
                                                              determination or a final determination. The Admin-
§ 12.280        DEFICIENCIES AND REFUNDS.                     istrator's determination must include the reasons for
                                                              the determination and state the time and manner for
     (A) Deficiencies may be assessed and refunds             appealing the determination. The time to file a pro-
granted any time within the period provided under             test or the time for the Administrator's response may
ORS 314.410, 314.415, and 317.950. The Adminis-               be extended by the Administrator, for good cause.
trator may by agreement with the taxfiler extend              Requests for extensions of time must be received
such time periods to the same extent as provided by           prior to the expiration of the original 30-day protest
statute.                                                      deadline. Written notice will be given to the taxfiler
                                                              if the Administrator's deadline is extended.
    (B) Consistent with ORS 314.410(3), in cases
where no tax return has been filed, there is no time              (B) Any final determination by the Administra-
limit for a notice of deficiency and/or the assess-           tor may be appealed by the taxfiler to the appeals
ment of taxes, penalty and interest due.                      board. Written notice of the appeal must be received
                                                              by the Administrator within 30 days after the Ad-
    (C) Notwithstanding subsections (A) and (B),              ministrator mailed or delivered the final determina-
the Administrator is not required to accept any tax           tion to the appellant. The notice of appeal must state
return from a taxfiler if:                                    the name and address of the appellant and include a
                                                              copy of the final determination.
        (1) The Administrator obtains a money                     (C) Within 90 days after the Administrator
judgment against the taxfiler for failure to pay an           mails or delivers the final determination to the ap-
unpaid account balance due; and                               pellant, the appellant must file with the appeals
                                                              board a written statement containing:
         (2) The Administrator or its designee law-
fully served the taxfiler with the lawsuit pursuant to               (1) The reasons the Administrator's deter-
the Oregon Rules of Civil Procedure; and                      mination is incorrect; and

         (3) The tax return is for a taxable year that                (2) What the correct determination should
is the subject of the general money judgment; and             be.

         (4) The Administrator gave written notice                    Failure to file such a written statement
stating that the taxfiler had an outstanding balance          within the time permitted will be deemed a waiver
due at least 30 days before the Administrator (or its         of any objections, and the appeal will be dismissed.
designee) filed a lawsuit for those particular taxable
years.                                                            (D) Within 150 days after the Administrator
(Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,          mails or delivers the final determination to the ap-
12/20/2007; Ord. 1046, Renum11.515&Amd, 08/19/2004; ‘ 90      pellant, the Administrator will file with the appeals
Code, § 5.60.280, 07/01/1998; Ord. 897, passed, 01/08/1998;   board a written response to the appellant's state-
Ord. 779, passed, 12/09/1993; Ord. 768, passed, 06/24/1993)   ment. A copy of the Administrator's response must


                                                                                                        (S-1 2010)
8                    Multnomah County – Chapter 12 - Business Income Tax


be mailed to the address provided by the appellant            § 12.400      EXEMPTIONS.
within 10 days.
                                                                   The Administrator may require the filings of tax
     (E) The Administrator must provide the appel-            returns or other documentary verification of any ex-
lant written notice of the hearing date and location          emption claimed under this section. To the extent
at least 14 days prior to the hearing. The appellant          set forth below, the following persons or incomes
and the Administrator may present relevant testi-             are exempt from payment of the business income
mony and oral argument at the hearing. The appeals            tax:
board may request such additional written comment                  (A) Persons whom the county is prohibited from
and documents as it deems appropriate.                        taxing under the Constitution or laws of the United
                                                              States or the Constitution or laws of the State of
    (F) Decisions of the appeals board mustl be in            Oregon or County Charter.
writing, state the basis for the decision and be
signed by the appeals board chair.                                 (B) Income arising from transactions which the
                                                              county is prohibited from taxing under the Constitu-
    (G) The decision of the appeals board is final as         tion or the laws of the United States or the Constitu-
of the issue date and no further administrative ap-           tion or laws of the State of Oregon or County Char-
peal will be provided.                                        ter.

    (H) The filing of an appeal with the appeals                  (C) Persons whose gross receipts from all busi-
board temporarily suspends the obligation to pay              ness, both within and without the county, amount to
any tax that is the subject of the appeal pending a fi-       less than $50,000 ($25,000 for tax years that begin
nal decision by the appeals board.                            prior to January 1, 2008). The Administrator may
                                                              demand a statement that the person's gross receipts
     (I) Penalty waiver and/or reduction requests are         for any tax year were less than the stated exemption
not subject to the protest/appeal process or timeline         amount for the tax year for which exemption is
outlined in Sections 12.290(A) through 12.290(H).             claimed.
The taxfiler must file a written request with the
Administrator detailing why a penalty should be                   (D) Corporations exempt from the State of Ore-
waived within 30 days of receipt of a billing notice          gon Corporation Excise Tax under ORS 317.080,
that assesses a penalty. The Administrator must re-           provided that any such corporation subject to the tax
spond to requests to reduce and/or waive penalties            on unrelated business income under ORS 317.920 to
within 60 days from the date the written request is           317.930 must pay a tax based solely on such in-
received. As provided in Section 12.700(G), the               come.
Administrator may waive or reduce penalties in cer-
tain situations. If the taxfiler has requested that pen-          (E) Trusts exempt from federal income tax un-
alties be waived and the Administrator denies the             der Internal Revenue Code Section 501, provided
taxfiler's request for this discretionary waiver of           that any exempt trust subject to tax on unrelated
penalties, the taxfiler may request a conference with         business income and certain other activities under
the Administrator (or Administrator's designee)               Internal Revenue Code Section 501(b) are subject to
within 30 days of the date of the Administrator’s no-         the tax under this chapter based solely on that in-
tice of denial. If the conference with the Administra-        come.
tor results in a denial of the penalty waiver request,
that decision is final and may not be appealed to the             (F) Any individual whose only business trans-
Appeals Board.                                                actions are exclusively limited to the renting or leas-
(Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,          ing of residential real property dwelling units pro-
12/20/2007; Ord. 1046, Renum11.516&Amd, 08/19/2004; ‘ 90      vided that the beneficial owner rents or leases less
Code, § 5.60.290, 07/01/1998; Ord. 768, passed, 06/24/1993)
                                                              than ten total units, regardless of whether the units
                                                              are located inside or outside of the County. For


(S-1 2010)
                                Chapter 12 - Business Income Tax                                                    9


purposes of this subsection, payments to foster care              (2) Operating within a permanent structure
and other service providers are considered payments       a display space, booth or table for selling or display-
for “services” and not for “rent”. If a building con-     ing merchandise by an affiliated participant at any
tains more than one residential living quarter, the       trade show, convention, festival, fair, circus, market,
term “dwelling unit” refers to each separate living       flea market, swap meet or similar event for less than
quarter. This exemption does not apply if any in-         14 days in any tax year.
come is recognized from the sale of residential           (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
property.                                                 12/20/2007; Ord. 1046, Renum11.517&Amd, 08/19/2004; ‘ 90
                                                          Code, § 5.60.400, 07/01/1998; Ord. 901, passed, 02/19/1998;
                                                          Ord. 897, passed, 01/08/1998; Ord. 779, passed, 12/09/1993;
    (G) Income of an individual from:                     Ord. 768, passed, 06/24/1993)

         (1) Sales, exchanges or involuntary conver-      § 12.500        IMPOSITION AND RATE OF
sions of a primary or secondary residence;                                TAX.

       (2) Sale of personal property acquired for              (A) Except as otherwise provided in this chap-
household or other personal use by the seller;            ter, a tax is imposed upon each person doing busi-
                                                          ness within the county equal to 1.45% of the net in-
         (3) Interest and dividend income earned          come from the business within the county effective
from investments, if the income is not created in the     with tax years beginning on or after January 1,
course of or related to the taxfiler’s business activi-   1993. For tax years beginning on or after January 1,
ties; and                                                 2008 each taxfiler not otherwise exempt must de-
                                                          termine their tax at the rate established in this sec-
         (4) Gains and losses incurred from the sale      tion, provided that each must pay at least a mini-
of investments (other than real property) that are not    mum tax of $100.00.
a part of a business.
                                                               (B) The payment of a tax required hereunder
     (H) Any person whose only business transac-          and the acceptance of such tax does not entitle a tax-
tions are exclusively limited to the following activi-    filer to carry on any business not in compliance with
ties:                                                     all the requirements of this code and all other appli-
                                                          cable laws.
         (1) Raising, harvesting and selling of the       (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
person's own crops, or the feeding, breeding, man-        12/20/2007; Ord. 1046, Renum11.518&Amd, 08/19/2004; ‘ 90
                                                          Code, § 5.60.500, 07/01/1998; Ord. 779, passed, 12/09/1993;
agement and sale of the person's own livestock,
                                                          Ord. 768, passed, 06/24/1993)
poultry, furbearing animals or honeybees, or sale of
the produce thereof, or any other agricultural, horti-    § 12.510        RETURN DUE DATE.
cultural or animal husbandry activity carried on by
any person on the person's own behalf and not for              (A) Tax returns must be on forms provided or
others, or dairying and the sale of dairy products to     approved by the Administrator. All tax returns must
processors. This exemption does not apply if, in ad-      be filed, together with the specified tax by the fif-
dition to the farm activities described in this subsec-   teenth day of the fourth month following the end of
tion, the person does any processing of the person's      the tax year.
own farm products which changes their character or
form, or the person's business includes the handling,         (B) The Administrator may, for good cause,
preparation, storage, processing or marketing of          grant extensions for filing returns, except that no ex-
farm products raised or produced by others; or the        tension may be granted for more than six months
processing of milk or milk products whether pro-          beyond the initial due date. This extension does not
duced by said person or by others for retail or           extend the time to pay the tax.
wholesale distribution.




                                                                                                         (S-1 2010)
10                    Multnomah County – Chapter 12 - Business Income Tax


     (C) The tax return must contain a written decla-         no designation of the quarterly installment to which
ration, verified by the taxfiler, to the effect that the      the payment is to be applied, will first be applied to
statements made therein are true.                             underpayments of estimated tax due for any prior
                                                              quarter of the tax year. Any excess amount will be
     (D) The Administrator will prepare blank tax re-         applied to the installment that next becomes due af-
turns and make them available upon request. Failure           ter the payment was received.
to receive or secure a form does not relieve any per-         (Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
son from the obligation to pay a tax under the Busi-          num11.521&Amd, 08/19/2004; ‘ 90 Code, § 5.60.530,
                                                              07/01/1998; Ord. 768, passed, 06/24/1993)
ness Income Tax Law.
(Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
num11.519&Amd, 08/19/2004; ‘ 90 Code, § 5.60.510,             § 12.545        TAX RETURN.
07/01/1998; Ord. 779, passed, 12/09/1993; Ord. 768, passed,
06/24/1993)                                                   Each tax return must be accompanied by a tax pay-
                                                              ment at the rate established in Section 12.500, pro-
§ 12.520        QUARTERLY ESTIMATES.                          vided that each such tax return must be accompa-
                                                              nied by a minimum tax of $100. The minimum
    For tax years beginning on or after January 1,            payment may have previously been paid by quar-
1993, every taxfiler who incurred a tax liability, un-        terly payments, an extension payment, or credit
der § 12.500 of $1,000 or greater must estimate the           available from a prior tax year.
taxfiler's tax liability for the current tax year under       (Ord. 1142, Add, 07/16/2009)
this chapter and pay the amount of tax determined
as provided in § 12.530.                                      § 12.550        PRESUMPTIVE TAX.
(Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
num11.520&Amd, 08/19/2004; ‘ 90 Code, § 5.60.520,                 (A) If a person fails to file a return, a rebuttable
07/01/1998; Ord. 768, passed, 06/24/1993)                     presumption exists that the tax payable amounts to
                                                              $500 for every tax year for which a return has not
§ 12.530        SCHEDULE FOR PAYMENT OF
                                                              been filed.
                ESTIMATED TAX.
                                                                   (B) Nothing in this section prevents the Admin-
     A taxfiler required under § 12.520 of this chap-
                                                              istrator from assessing a tax due which is less than
ter to make payments of estimated tax must make
                                                              or greater than $500 per tax year.
the payments in installments as follows:
                                                                  (C) If the taxfiler filed a tax return the previous
    (A) One quarter or more of the estimated tax on
                                                              tax year, then presumptive taxes assessed under this
or before the fifteenth day of the fourth month of the
                                                              subsection will be considered a tax return. Pre-
tax year;
                                                              sumptive taxes assessed under this subsection are
                                                              considered filed documents and are subject to the
    (B) One quarter or more of the estimated tax on
                                                              time limitations for deficiencies and refunds as de-
or before the fifteenth day of the sixth month of the
                                                              scribed in subsection 12.280.
tax year;
                                                                  (D) Taxes determined under this subsection are
    (C) One quarter or more of the estimated tax on
                                                              subject to penalties and interest from the date the
or before the fifteenth day of the ninth month of the
                                                              taxes should have been paid as provided in subsec-
tax year; and
                                                              tion 12.510 in accordance with subsections 12.700
                                                              and 12.710. The Administrator will send notice of
    (D) The balance of the estimated tax must be
                                                              the determination and assessment to the taxfiler.
paid on or before the fifteenth day of the twelfth            (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
month of the tax year.                                        12/20/2007; Ord. 1046, Renum11.522&Amd, 08/19/2004; ‘ 90
                                                              Code, § 5.60.550, 07/01/1998; Ord. 897, passed, 01/08/1998;
    (E) Any payment of the estimated tax received             Ord. 779, passed, 12/09/1993; Ord. 768, passed, 06/24/1993)
by the Administrator for which the taxfiler has made

(S-1 2010)
                               Chapter 12 - Business Income Tax                                           11


§ 12.560        PAYMENT PLAN FEE.                          (C) Partnerships. In determining income, no
                                                       deduction is allowed for any compensation for ser-
    If a person fails to pay the Multnomah County      vices rendered by, or interest paid to, owners of
Business Income tax when due, the Administrator        partnerships, limited partnerships, limited liability
may establish a payment plan pursuant to written       companies, limited liability partnerships or family
policy. The Administrator may charge a set up fee      limited partnerships. Guaranteed payments to part-
for each payment plan established.                     ners or members are deemed compensation paid to
(Ord. 1046, Add, 08/19/2004)                           owners for services rendered. However:

§ 12.600        INCOME DETERMINATIONS.                          (1) For general partners or members, 75%
                                                       of income determined without such deductions is al-
    (A) Owners compensation deduction. OWNERS          lowed as an additional deduction, not to exceed the
COMPENSATION DEDUCTION is defined as the               amount as determined in subsection (A) above per
additional deduction allowed in subsections (B), (C)   general partner or member.
and (D) below.                                                  (2) For limited partners or members of lim-
                                                       ited liability corporations who are deemed partners
         (1) For tax years beginning on or after       by administrative rule or policy, 75% of income de-
January 1, 1999, the owners compensation deduc-        termined without such deductions is allowed as an
tion is indexed by the Consumer Price Index - All      additional deduction, not to exceed the lesser of ac-
Urban Consumers (CPI-U) U.S. City Average as           tual compensation and interest paid or the amount
published by the U.S. Department of Labor, Bureau      determined in subsection (A) above per compen-
of Labor Statistics, using the September to Septem-    sated limited partner.
ber index, not seasonally adjusted (unadjusted in-
dex). The Administrator determines the exact de-            (D) Corporations. In determining income, no
duction amount and publishes the amount on forms.      deduction is allowed for any compensation for ser-
Any increase or decrease under this subsection         vices rendered by, or interest paid to, controlling
which is not a multiple of $500 will be rounded up     shareholders of any corporation, including, but not
or down to the next multiple of $500 at the Admin-     limited to C and S corporations and any other entity
istrator’s discretion.                                 electing treatment as a corporation, either C or S.
                                                       However, 75% of the corporation's income, deter-
        (2) For tax years beginning on or after        mined without deduction of compensation or inter-
January 1, 2008, the owners compensation deduc-        est, is allowed as a deduction in addition to any
tion cannot exceed $80,000 plus CPI-U for Septem-      other allowable deductions, not to exceed the lesser
ber 2007 to September 2008 per owner as defined in     of the actual compensation and interest paid or the
Sections (B), (C) and (D) below.                       amount for each controlling shareholder as deter-
                                                       mined in subsection (A) above.
         (3) For tax years beginning on or after
January 1, 2009, the owners compensation deduc-                 (1) For purposes of this subsection, to cal-
tion will be indexed as described in (1) above.        culate the compensation for services rendered by or
                                                       interest paid to controlling shareholders that must be
    (B) Sole proprietorship. In determining income,    added back to income, wages, salaries, fees, or in-
no deductions is allowed for any compensation for      terest paid to all persons meeting the definition of a
services rendered by, or interest paid to, owners.     controlling shareholder, must be included.
However, 75% of income determined without such
deductions is allowed as an additional deduction,               (2) For purposes of this subsection, in de-
not to exceed the amount per owner as determined       termining the number of controlling shareholders, a
in subsection (A) above.                               controlling shareholder and that person's spouse,
                                                       parents and children count as one owner, unless




                                                                                                 (S-1 2010)
12                 Multnomah County – Chapter 12 - Business Income Tax


such spouse, parent or child individually own more        rent tax year before this deduction but after all other
than 5% ownership of outstanding stock or securi-         deductions from income allowed by this section and
ties in their own name. In that case, each spouse,        apportioned for business activity both within and
parent or child who owns more than 5% of stock is         without the county.
deemed to be an additional controlling shareholder.
                                                                   (1) When the operations of the taxfiler from
        (3) For purposes of this subsection (C),          doing business both within and without the county
joint ownership of outstanding stock or securities is     result in a net operating loss, such loss will be ap-
not be considered separate ownership.                     portioned in the same manner as the net income un-
                                                          der § 12.600. However, in no case may a net operat-
     (E) Estates and trusts. In determining income        ing loss be carried forward from any tax year during
for estates and trusts, income is measured before         which the taxfiler conducted no business within the
distribution of profits to beneficiaries. No additional   county or the taxfiler was otherwise exempt from
deduction is allowed.                                     tax filing requirements.

     (F) Nonbusiness income. In determining income                 (2) In computing the net operating loss for
under this section, an allocation is allowed for non-     any tax year, the net operating loss of a prior tax
business income as reported to the State of Oregon.       year is not allowed as a deduction.
However, income treated as nonbusiness income for
State of Oregon tax purposes may not necessarily be               (3) In computing the net operating loss for
defined as nonbusiness income under the Business          any tax year, no compensation allowance deduction
Income Tax Law. Interest and dividend income,             is allowed to increase the net operating loss. COM-
rental income or losses from real and personal busi-      PENSATION ALLOWANCE DEDUCTION is de-
ness property, and gains or losses on sales of prop-      fined as the additional deduction allowed by subsec-
erty or investments owned by a trade or business are      tion (A).
treated as business income for purposes of the Busi-
ness Income Tax Law. Income derived from non-                      (4) The net operating loss of the earliest tax
unitary business functions reported at the state level    year available must be exhausted before a net oper-
may be considered nonbusiness income. Non-                ating loss from a later tax year may be deducted.
unitary income will not be recognized at an intra-
state level. The taxfiler has the burden of showing               (5) The net operating loss in any tax year is
that income is nonbusiness income.                        allowed as a deduction in any of the five succeeding
                                                          tax years until used or expired. Any partial tax year
    (G) Tax based on or measured by net income. In        will be treated the same as a full tax year in deter-
determining income, no deduction is allowed for           mining the appropriate carry-forward period.
taxes based on or measured by net income. No de-          (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
duction is allowed for the federal built-in gains tax.    12/20/2007; Ord. 1046, Renum11.523&Amd, 08/19/2004; ‘ 90
                                                          Code, § 5.60.600, 07/01/1998; Ord. 901, passed, 02/19/1998;
                                                          Ord. 897, passed, 01/08/1998; Ord. 779, passed, 12/09/1993;
    (H) Ordinary gain or loss. In determining in-         Ord. 768, passed, 06/24/1993)
come, gain or loss from the sale, exchange or invol-
untary conversion of real property or tangible and        § 12.610        APPORTIONMENT OF INCOME.
intangible personal property not exempt under §
12.400(G) and § 12.400(H) must be included as or-              (A) Business activity means any of the elements
dinary gain or loss.                                      of doing business. However, a person is not be con-
                                                          sidered to have engaged in business activities solely
    (I) Net operating loss. In determining income,        by reason of sales of tangible personal property in
a deduction is allowed equal to the aggregate of the      any state or political subdivision, or solely the so-
net operating losses incurred in prior years, not to      licitation of orders for sales of tangible personal
exceed 75% of the income determined for the cur-          property in any state or political subdivision. Busi-


(S-1 2010)
                                Chapter 12 - Business Income Tax                                                        13


ness activities conducted on behalf of a person by        chapter, unless allocation is otherwise allowed in
independent contractors are not considered business       this chapter.
activities by the person in any state or political sub-
division.                                                      (E) If the apportionment provisions of subsec-
                                                          tion (B) do not fairly represent the extent of the tax-
     (B) In computing the tax, taxfilers that have in-    filer's business activity in the county and result in
come from business activity both within and without       the violation of the taxfiler's rights under the Consti-
the county must determine the income apportioned          tution of this state or the United States, the taxfiler
to the county by multiplying the total net income         may petition the Administrator to permit the taxfiler
from the taxfiler's business by a fraction, the nu-       to:
merator of which is the total gross income of the
taxfiler from business activity in the county during              (1) Utilize the method of allocation and ap-
the tax year, and the denominator of which is the to-     portionment used by the taxfiler under the applica-
tal gross income of the taxfiler from business activ-     ble laws of the state imposing taxes upon or meas-
ity everywhere during the tax year.                       ured by net income; or

    (C) In determining the apportionment of gross                 (2) Utilize any other method to effectuate
income within the county under subsection (B):            an equitable apportionment of the taxfiler's income.
                                                          (Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
         (1) Sales of tangible personal property are      num11.524&Amd, 08/19/2004; ‘ 90 Code, § 5.60.610,
                                                          07/01/1998; Ord. 897, passed, 01/08/1998; Ord. 779, passed,
deemed to take place in the county if the property is     12/09/1993; Ord. 768, passed, 06/24/1993)
delivered or shipped to a purchaser within the
county regardless of the f.o.b. point or other condi-     § 12.615        BUSINESS RETENTION CREDIT
tions of sale. Sales of tangible personal property                        FOR INVESTMENT
shipped from the county to a purchaser located                            MANAGEMENT FIRMS.
where the taxfiler is not taxable are not apportioned
to the county.                                                (A) Subject to the limitations in subsection (C)
                                                          below, for the four years commencing January 1,
        (2) Sales other than sales of tangible per-       2009 an Investment Management Firm is entitled to
sonal property are deemed to take place in the            a credit against the total amount of its business in-
county, if the income producing activity is per-          come tax due. The credit is determined by subtract-
formed in the county.                                     ing from the business income tax due the greater of:

     (D) Certain industries or incomes are subject to             (1) $4,000 times the number of owners, not
specific apportionment methodologies. Such meth-          including limited partners, subject to the Owner’s
odologies are described in administrative rules           Compensation Deduction allowed in Section
adopted in accordance with § 12.210. Industry spe-        12.600, or
cific or income specific apportionment methodolo-
gies required by Oregon Revised Statutes for appor-               (2) 30 percent of the total business income
tionment of gross sales will be used in cases where       tax otherwise due. If the resulting difference is a
no rule has been adopted by the Administrator re-         negative number, the amount of the credit will be
garding the apportionment of such industry or in-         zero. Any allowed credit not used in a particular
come. When gross sales as reported to Oregon are          year will not be refunded and will not be carried
used for apportionment purposes, such gross sales         forward to a succeeding tax year, except as provided
will be defined as gross income for apportionment         in subsection (B).
purposes herein. All apportionment methodologies
directed under this subsection will be a single factor        (B) For purposes of this credit, the "first tax
gross income apportionment as directed under §            year" would be a tax year in which the Investment
12.210 (B) and § 12.210 (C). In those specific cases      Management Firm is doing business in Multnomah
where the state has directed allocation of income,        County and either
such income will be apportioned for purposes of this
                                                                                                           (S-1 2010)
14                   Multnomah County – Chapter 12 - Business Income Tax


         (l) The Investment Management Firm was            amended by the taxfiler to correct an error in the
not doing business in Multnomah County in the              original federal or state return, a report of such
prior tax year or                                          change must be filed with the Administrator within
                                                           60 days after the date of the notice of the final de-
        (2) The prior tax year began prior to Janu-        termination of change or after an amended return is
ary 1, 2009.                                               filed with the federal or state agencies. The report
                                                           must be accompanied by an amended tax return with
     (C) This credit may be claimed as follows:            respect to such income and by any additional tax,
                                                           penalty, and interest due.
        (1) In the first tax year, the credit is limited
to 50 percent of the amount calculated in subsection            (B) The Administrator may assess deficiencies
(A). The remaining 50 percent shall be deferred and        and grant funds resulting from changes to federal,
can only be claimed in the third of three consecutive      state or business income tax returns within the time
tax years (in which the Investment Management              periods provided for in § 12.280 of this chapter,
Firm is doing business in Multnomah County) start-         treating the report of change in federal, state or
ing with the first tax year as defined above.              business income tax returns as the filing of an
                                                           amended tax return.
          (2) In the second consecutive tax year that
the Investment Management Firm is doing business               (C) The Administrator may assess penalties and
in Multnomah County, the credit is limited to 50           interest on the additional tax due as provided in §§
percent of the amount calculated in subsection (A)         12.700 (A) and 12.710 or may refuse to grant a re-
The remaining 50 percent shall be deferred and can         fund of taxes as a result of the amended return if the
only be claimed in the fourth of four consecutive tax      amended return is not filed with the Administrator
years (in which the Investment Management Firm is          within the time limits set forth in subsection (A).
doing business in Multnomah County) starting with          (Ord. 1142, Amended, 07/16/2009; Ord. 1046, Re-
the first tax year as defined above.                       num11.525&Amd, 08/19/2004; ‘ 90 Code, § 5.60.620,
                                                           07/01/1998; Ord. 897, passed, 01/08/1998; Ord. 779, passed,
                                                           12/09/1993; Ord. 768, passed, 06/24/1993)
        (3) In the third consecutive tax year that the
Investment Management Firm is doing business in            § 12.700        PENALTY.
Multnomah County, the Investment Management
Firm, in addition to the full credit calculated in sub-        (A) (1) A penalty will be assessed if a person:
section (A), can claim the 50 percent deferred credit
that was calculated in subsection (1) above.                            (a) Fails to file a tax return or extension
                                                           request at the time required under §§ 12.510(A) or
         (4) In the fourth consecutive tax year that       12.620(A); or
the Investment Management Firm is doing business
in the Multnomah County, the Investment Manage-                          (b) Fails to pay a tax when due.
ment Firm, in addition to the full credit calculated in
subsection (A), can claim the 50 percent deferred                    (2) The penalty under subsection (A) is:
credit that was calculated in subsection (2) above.                      (a) Five percent of the total tax liability
(Ord. 1154, Add, 02/11/2010)
                                                           if the failure is for a period less than four months;
§ 12.620        CHANGES TO FEDERAL OR
                                                                         (b) An additional penalty of 20% of the
                STATE TAX RETURNS.
                                                           total tax liability if the failure is for a period of four
                                                           months or more; and
    (A) If a taxfiler's reported net income under ap-
plicable state laws imposing a tax on or measured
                                                                          (c) An additional penalty of 100% of
by income is changed by the Federal Internal Reve-
                                                           the total tax liability of all tax years if the failure to
nue Service or the state Department of Revenue, or
                                                           file is for three or more consecutive tax years.

(S-1 2010)
                                 Chapter 12 - Business Income Tax                                                     15



   (B) (1) A penalty will be assessed if a person                (E) The Administrator may impose a civil pen-
who has filed an extension request:                          alty under subsection (D) only if the Administrator
                                                             gave notice of the potential for assessment of civil
            (a) Fails to file a tax return by the ex-        penalties for failure to comply or respond in the
tended due date; or                                          original written notice.

           (b) Fails to pay the tax liability by the             (F) The Administrator may waive or reduce any
extended due date.                                           penalty determined under subsections (A) through
                                                             (D) for good cause, according to and consistent with
        (2) The penalty under subsection (B) is:             written policies.
                                                             (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
              (a) Five percent of the total tax liability    12/20/2007; Ord. 1046, Renum11.599&Amd, 08/19/2004; ‘ 90
                                                             Code, § 5.60.700, 07/01/1998; Ord. 897, passed, 01/08/1998;
if the failure is for a period of less than four months;     Ord. 779, passed, 12/09/1993; Ord. 768, passed, 06/24/1993)
and
                                                             § 12.710        INTEREST.
              (b) An additional penalty of 20% of the
total tax liability if the failure is for a period of four        (A) Interest will be assessed on any unpaid tax
months or more.                                              at the rate of .833% simple interest per month or
                                                             fraction thereof (10% per annum), computed from
    (C) (1) A penalty will be assessed if a person:          the original due date of the tax to the fifteenth day
                                                             of the month following the date of payment.
              (a) Fails to pay at least 90% of the total
tax liability by the original due date; or                       (B) Interest will be assessed on any unpaid or
                                                             underpaid quarterly estimated payment required by
            (b) Fails to pay at least 100% of the            §§ 12.520 and 12.530 at the rate of .833% simple in-
prior year's total tax liability by the original due         terest per month or fraction thereof (10% per an-
date.                                                        num), computed from the due date of each quarterly
                                                             estimated payment to the original due date of the tax
         (2) The penalty under subsection (C) is 5%          return to which the estimated payments apply.
of the tax underpayment, but not less than $5.
                                                                 (C) Notwithstanding subsection (B), there is no
    (D) The Administrator may impose a civil pen-            interest on underpayment of quarterly estimated
alty of up to $500 for each of the following viola-          payments if:
tions of this chapter:
                                                                    (1) The total tax liability of the prior tax
         (1) Failure to file any tax return within 60        year was less than $1,000;
days of the Administrator's original written notice to
file; or                                                              (2) An amount equal to at least 90% of the
                                                             total tax liability for the current tax year was paid in
        (2) Failure to pay any tax within 60 days of         accordance with § 12.530; or
the Administrator's original written notice for pay-
ment; or                                                             (3) An amount equal to at least 100% of the
                                                             prior year's total tax liability was paid in accordance
        (3) Failure to provide either documents or           with § 12.530.
information as required by §§ 12.260 within 60 days
of the Administrator's original written notice to pro-           (D) For purposes of subsection (B), the amount
vide the documents or information; or                        of underpayment is determined by comparing 90%
                                                             of the current total tax liability amount to quarterly
        (4) Failure to fully complete any form re-           estimated payments made prior to the original due
quired under this chapter.                                   date of the tax return. However, if 100% of the
                                                                                                            (S-1 2010)
16                   Multnomah County – Chapter 12 - Business Income Tax


prior year’s total tax liability is paid to the Adminis-              (2) the date the tax return was filed or the
trator by the due date of the fourth quarterly pay-           refund was otherwise requested; or
ment, the Administrator may use the prior year’s tax
liability if doing so will reduce the amount of inter-                (3) the date the tax was paid, to the date of
est owed.                                                     the refund; and

    (E) For purposes of subsection (A) , the amount               (B) Any overpayments of taxes that are the re-
of tax due on the tax return will be reduced by the           sult of an amended return being filed will be re-
amount of any tax payment made on or before the               funded with interest for each month or fraction
date for payment of the tax in accordance with §              thereof for the period beginning four months after
12.510(A) or 12.530.                                          the date the taxfiler filed the amended return. This
                                                              subsection applies to tax returns that are amended
    (F) Interest at the rate specified in subsection          due to a change to the federal, state or business in-
(A) accrues from the original due date without re-            come tax return.
gard to any extension of the filing date.                     (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
                                                              12/20/2007; Ord. 1046, Renum11.528&Amd, 08/19/2004; ‘ 90
                                                              Code, § 5.60.720, 07/01/1998; Ord. 897, passed, 01/08/1998;
    (G) Any interest amounts properly assessed in             Ord. 768, passed, 06/24/1993)
accordance with this section may not be waived or
reduced by the Administrator, unless specifically             § 12.730        CRIMINAL PENALTIES.
provided for by written policy.
(Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
                                                                  Violation of §§ 12.230 or 12.240 is punishable,
12/20/2007; Ord. 1046, Renum11.526&Amd, 08/19/2004; ‘ 90
Code, § 5.60.710, 07/01/1998; Ord. 897, passed, 01/08/1998;   upon conviction thereof, by a fine not exceeding
Ord. 779, passed, 12/09/1993; Ord. 768, passed, 06/24/1993)   $500 or by imprisonment for a period not exceeding
                                                              six months, or by both fine and imprisonment. In
§ 12.715        PAYMENTS APPLIED.                             addition, any county employee convicted for viola-
                                                              tion of §§ 12.230 or 12.240 will be dismissed from
    Taxes received will be applied first to any pen-          employment and will be barred from employment
alty accrued, then to interest accrued, then to taxes         for a period of five years thereafter. Any agent of
due, unless the Administrator determines in accor-            the county who is convicted is ineligible for partici-
dance with its written policies that a more equitable         pation in any county contract for a period of five
method exists for a particular taxfiler’s account.            years thereafter.
(Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,          (Ord. 1142, Amended, 07/16/2009; Ord. 1104, Amended,
12/20/2007; Ord. 1046, Renum11.527&Amd, 08/19/2004; ‘ 90      12/20/2007; Ord. 1046, Renum11.599(G), 08/19/2004)
Code, § 5.60.715, 07/01/1998; Ord. 768, passed, 06/24/1993)
                                                              § 12.805        SEVERABILITY.
§ 12.720        INTEREST ON REFUNDS.
                                                                  If any section, subsection, paragraph, sentence,
     When, under a provision of the Business In-              clause or phrase of this chapter is for any reason
come Tax Law, taxfilers are entitled to a refund of a         held to be unconstitutional or otherwise invalid, that
portion or all of a tax paid to the Administrator, they       decision will not affect the validity of the remaining
will receive simple interest on such amount at the            portions of this chapter. The Board of County
rate specified in § 12.710(A), subject to the follow-         Commissioners hereby declares that it would have
ing:                                                          passed each section, subsection, paragraph, sen-
                                                              tence, clause or phrase regardless of the fact that any
    (A) Any overpayments will be refunded with in-            one or more sections, subsections, paragraphs, sen-
terest for each month or fraction thereof for a period        tences, clauses or phrases be declared unconstitu-
beginning four months after the later of:                     tional or otherwise invalid.
                                                              (Ord. 1142, Renum&Amd12.800, 07/16/2009; Ord. 1046, Re-
         (1) the due date of the tax return;                  num11.599(G), 08/19/2004)



(S-1 2010)
                                 Chapter 12 - Business Income Tax                                                        17


§ 12.815       OPERATIVE DATE.                                 (B) Any individual who intentionally accesses
                                                           the Administrator’s computer database without au-
    This chapter applies to tax years beginning on         thorization will be fined:
or after January 1, 1993. For tax years ending on or
before December 31, 1992, this chapter applies to                  (1) $500 if the individual acquires any in-
any administrative determination made on or after          formation regarding any business account found in
January 1, 1994.                                           the database;
(Ord. 1142, Renum&Amd12.820, 07/16/2009; Ord. 1046, Re-
num11.599(G), 08/19/2004)                                          (2) $1,000 or the cost of the loss (which-
                                                           ever is greater) if the individual uses or attempts to
§ 12.840       FRIVOLOUS FILING.
                                                           use the acquired information for financial gain of
                                                           any kind; or
     A $500.00 penalty will be assessed if a taxfiler
takes a "frivolous position" in respect to preparing
                                                                    (3) $5,000 or the cost of the loss (which-
the taxfiler’s tax return. A tax return is considered
                                                           ever is greater) if the individual causes the transmis-
frivolous if a taxfiler does not provide information
                                                           sion of a program, information, code, or command
on which the substantial correctness of the self-
                                                           to the Administrator’s computer database, and, as a
assessment may be judged or if the tax return con-
                                                           result of such conduct, causes damage to the data-
tains information that on its face indicates that the
                                                           base.
self-assessment is substantially incorrect. Examples       (Ord. 1142, Renum&Amd12.855, 07/16/2009; Ord. 1104, Add,
of “frivolous positions” as provided in Oregon Ad-         12/20/2007)
ministrative Rule 150-316.992(5) are adopted by di-
rect reference.                                            § 12.990        PARTICIPATION OF CITIES.
(Ord. 1142, Renum&Amd12.845, 07/16/2009; Ord. 1104, Add,
12/20/2007)                                                     To facilitate a unified system of collection and
                                                           allocation of all county and municipal taxes upon
§ 12.850       HACKING.
                                                           business net income within the county, any city the
                                                           territory of which is in whole or in part within the
   (A) Definitions. As used in this section, the fol-
                                                           county may, if authorized by its governing body,
lowing definitions apply:
                                                           participate under and share in the revenue derived
                                                           from this chapter, upon such terms and conditions as
    ADMINISTRATOR’S COMPUTER DATA-
                                                           the county and city may agree by written contract.
BASE. Computer application(s) used by the Ad-              (Ord. 1104, Renum12.840, 12/20/2007; Ord. 1046, Re-
ministrator to calculate and store business and fi-        num11.529&Amd, 08/19/2004; ‘ 90 Code, § 5.60.840,
nancial data collected under the authority granted by      07/01/1998; Ord. 779, passed, 12/09/1993; Ord. 768, passed,
the Business Income Tax Law.                               06/24/1993)


    LOSS. Any reasonable cost incurred by the              § 12.995        FORMER REGULATIONS
City of Portland, including but not limited to the                         SUPERSEDED BY THIS
cost of responding to an offense, conducting a dam-                        SUBCHAPTER; EXCEPTIONS.
age assessment, and restoring the data, program,
system, or information to its condition prior to the           Effective for tax years beginning on or after
offense, and any revenue lost, cost incurred, or other     January 1, 1993, '90 MCC Chapter 5.70 is super-
consequential damages incurred because of interrup-        seded and given no effect until this chapter is re-
tion of service.                                           pealed or otherwise ceases to be effective. For tax
                                                           years ending on or before December 31, 1992, all
    DAMAGE. Any impairment to the integrity or             determinations of obligations and responsibilities
availability of data, a program, a system, or infor-       required of any persons under '90 MCC Chapter
mation.                                                    5.70, made on or before December 31, 1993 remains
                                                           binding upon those persons. However, on and after
                                                           January 1, 1994, this chapter [formerly §§ 11.500 et
                                                           seq.] applies to all determinations of obligations and

                                                                                                            (S-1 2010)
18                   Multnomah County – Chapter 12 - Business Income Tax


responsibilities for tax years ending on or before
December 31, 1992 with the exceptions of:

    (A) Determination of income under '90 MCC
5.70.015;

     (B) Treatment of payments to owners or con-
trolling shareholders under '90 MCC 5.70.025;

    (C) Net operating loss deduction under '90
MCC 5.70.030;
    (D) Ordinary gain or loss under '90 MCC
5.70.035;

     (E) Rate of tax under ’ 90 MCC 5.70.045;

    (F) Apportionment of income under '90 MCC
5.70.050;

    (G) Partnerships, S corporations, estates and
trusts under '90 MCC 5.70.055;

     (H) Exemptions under '90 MCC 5.70.060;

     (I) State laws incorporated by reference under
'90 MCC 5.70.075 (except that the City of Portland,
Bureau of Licenses will replace any references to
the state Department of Revenue as the Administra-
tor of the Tax.);

     (J) Amendments under '90 MCC 5.70.110.
(Ord. 1142, Amended, 07/16/2009; Ord. 1104, Renum12.850,
12/20/2007; Ord. 1046, Renum11.530&Amd, 08/19/2004; ‘ 90
Code, § 5.60.850, 07/01/1998; Ord. 779, passed, 12/09/1993;
Ord. 768, passed, 06/24/1993)




(S-1 2010)