OAR 150-317-0550: Consolidated Oregon Return: Affiliated Group

(1) A corporation filing a consolidated federal return must file a consolidated Oregon return. The consolidated Oregon return must include the same affiliated group included in the consolidated federal return, except as provided in this section. (2) The following taxpayers included in consolidated federal returns must not file consolidated Oregon returns: (a) A corporation that is not a member of a unitary group (as defined under ORS 317.705(2)) with any other corporation included in the consolidated federal return; (b) A corporation that is permitted or required under ORS 314.667 to determine its Oregon taxable income on a separate basis; (c) A corporation that is permitted or required by rule or statute to use different apportionment factors than are applicable to other members of the affiliated group; or (d) Alien, domestic, or foreign insurers required by ORS 317.710 (5) or (7) to file separately from the taxpayer’s federal consolidated group. (3) Insurance companies that are unitary members of a federal consolidated return but neither do business in Oregon nor file an annual statement with the Oregon Insurance Division of the Department of Consumer and Business Services must be included in an Oregon consolidated return. (4) A newly organized member of a unitary group, included in an affiliated group filing a consolidated federal return, must be included in the consolidated Oregon return in the taxable year the new member is organized. (5) A newly acquired member of an affiliated group must be excluded from the consolidated Oregon return until completion of the first full taxable year in which the new member is a unitary member of the affiliated group. However, if a newly acquired member is unitary on or near the acquisition date, it must be included in the consolidated Oregon return. (a) The newly acquired member’s net income, for the period from the acquisition date to the end of the affiliated group’s taxable year, must be included in Oregon consolidated net income. (b) The newly acquired member’s property, payroll, and sales, for the period from the acquisition date to the end of the affiliated group’s taxable year, must be included in the computation of the Oregon apportionment percentage. The average value of the newly acquired member’s assets in the property factor must be computed as provided in OAR 150-314-0406. The monthly property value must be zero for the newly acquired member for each of the months prior to acquisition.