Bill > HB2109

This bill modifies Oregon's tax law regarding penalties for understating net tax, primarily by raising the threshold for what constitutes a substantial understatement from previous lower amounts to $1 million. The bill updates the penalty provisions in Oregon Revised Statutes (ORS) 314.402, which imposes a 20% penalty on tax underpayments resulting from substantial understating of net tax. The legislation introduces a mechanism for annual cost-of-living adjustments to the threshold amount, with adjustments to be calculated based on the U.S. City Average Consumer Price Index and rounded to the nearest lower $50 increment. The bill also makes minor technical changes to language around abusive tax shelters and preserves existing provisions that allow the Department of Revenue to waive penalties if a taxpayer can demonstrate reasonable cause and good faith. The changes will apply to tax years beginning on or after January 1, 2025, and the bill itself will take effect 91 days after the adjournment of the 2025 regular legislative session, providing clarity and updated guidelines for tax reporting and potential penalties.

Budget and Finance

https://olis.oregonlegislature.gov/liz/2025R1/Measures/Overview/HB2109