How much income must the Carters report on their Oregon tax return?

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1 Welcome to Oregon CPE Series Part Year & Nonresidents Quiz Student Name 1. Mr. and Mrs. Hilton lived in Vancouver, WA all year. Mrs. Hilton works in Portland and Mr. Hilton works in Vancouver. They file a joint federal return. Mr. and Mrs. Hilton can file separate Oregon returns. 2. Mr. and Mrs. Carter are full-year residents of California. During the year they had the following income: Wages (Earned in CA) $22,000 Interest from CA bank 540 Interest from OR bank 210 Interest from OR municipal bonds 800 Interest from U.S. bonds 150 Interest from installment sale on Oregon home 1,800 How much income must the Carters report on their Oregon tax return? a. $0 b. $210 c. $1,800 d. $2,010 e. $2, You are deemed to be a special case Oregon resident if you are NOT domiciled in Oregon, maintain a permanent place of abode outside Oregon and the days spent in Oregon during the year is less than: a. 31 b. 60 c. 90 d You may file Oregon Form 40S if you have pension income. 5. You are an Oregon part-year resident. Your spouse was an Oregon nonresident all year. If you choose to file MFJ for Oregon, which Oregon form should you file? a. 40S b. 40 c. 40P d. 40N 1

2 6. You may claim the additional exemption for a disabled child on Forms 40N and 40P only if your child attended school inside Oregon. 7. John and Mary are filing a joint federal return. What steps must they complete to file MFS on their Oregon return? a. They must have different residency statuses for Oregon. b. Both must report his or her own share of income and deductions. c. Both must complete and attach a copy of their joint federal return, including schedules which show the appropriate division of income, federal tax liability and itemized deductions. d. All of the above. 8. An Oregon nonresident must pay Oregon income tax on which of the following Oregon sources of income. a. Unemployment b. Alimony c. Interest d. Dividends 9. A taxpayer who is filing Form 40N or 40P may only claim the Oregon child and dependent care credit if his/her child attended daycare in Oregon. 10. Jeb, an interstate truck driver, is a full-year resident of Vancouver, WA. He works for an Oregon based trucking company. Jeb's duties include delivering loads to customers in Idaho and Oregon. Jeb must pay Oregon income tax on wages he earns while driving in Oregon. 11. Oregon's standard deduction for a single taxpayer aged 65 and blind is: a. $1,950 b. $2,150 c. $3,150 d. $4, Jane, a full-year Oregon resident, paid tax to both Oregon and Idaho on income jointly taxed by both states. She should claim the credit for tax paid to another state on her Oregon return. 2

3 13. The credit for tax paid to another state is the lesser of the following: The other state's tax after credits. Your Oregon tax after all other credits. (Your AGI taxed by both states Your modified AGI) x Your Oregon tax after all other credits. (Your AGI taxed by both states Your total income on the other state's return) x The other state's tax after all other credits. 14. You are considered severely disabled by Oregon and qualify for the extra exemption for the disabled if which of the following is true: a. You permanently lost the use of one or both feet. b. You permanently lost the use of both hands. c. You are permanently blind. d. You have a permanent condition that without special equipment or help limits your ability to earn a living, maintain a household or support yourself. e. All of the above. 15. You will owe a 5 percent penalty on any 2010 tax not paid by April 18, 2011 on your Oregon return. Further, if you file more than 2 months after the due date of your return, including extensions, you will owe an additional 20 percent penalty; that is, you will owe a combined penalty of 25%. 16. You are automatically granted an extension of time to file your Oregon return when you file for an extension on your federal return. 17. Nonresident federal employees who work on Bonneville, The Dalles, John Day or McNary dams should exclude this income from their Oregon return. 18. A taxable refund from California will never be a subtraction on the Oregon return. 3

4 19. Jennie moved from Oregon to California during the year. She can include the cost of her moving expenses on her Oregon part-year return. 20. Which of the following credits does not get prorated on your Oregon 40P or 40N return? a. Earned income credit. b. Working family credit. c. Political contribution credit. d. Credit for the elderly or the disabled. 21. The Oregon standard deduction for a head of household taxpayer, age 49 is: a. $1,950 b. $3,150 c. $3,140 d. $4, John was an Oregon nonresident for the entire year. What is his total income to be reported in the Oregon column of Form 40N? Oregon wages $50,000 Net rental income from property inside Oregon 5,000 Interest on installment sale on Oregon investment property 6,000 Early withdrawal from pension plan with Oregon employer 5,000 a. $50,000 b. $55,000 c. $61,000 d. $66, A nonresident of Oregon with military active duty pay earned inside Oregon should include the amount of active duty pay received during the year in the Oregon column of Form 40N. 4

5 24. You were an Oregon nonresident all year. What income is not considered to be Oregon source? a. Interest and dividend income earned on shares you own in an Oregon-based company. b. Interstate transportation wages from an interstate railroad company. c. Retirement income received from an Oregon employers pension plan. d. Compensation for military active duty pay while stationed inside Oregon. e. All of the above. MINI PROBLEM Frosty Snowman (single and age 30) was a full-year resident of Vancouver, WA. During the year, he had the following income and deductions. INCOME OREGON WASHINGTON Wages $30,000 $10,000 Bank interest Unemployment 7, K withdrawal 2,000 DEDUCTIONS Student loan interest $2,000 Frosty s federal tax liability is $5,538 including the additional 10% penalty on his 401k distribution. His Oregon income tax withheld was $1,800. Frosty received a $400 Making Work Pay credit in Prepare Oregon Form 40N for Frosty and answer questions (Answers are rounded to nearest dollar.) 5

6 25. What is the amount on Form 40N Line 21S? a. $30,000 b. $30,150 c. $32,150 d. $37, What is the amount on Form 40N, Line 23S? a. $0 b. $490 c. $1,510 d. $2, What is the amount on Form 40N, Line 39? a. 66.3% b. 71.6% c. 75.5% d. 82.4% 28. What is the amount on Form 40N, Line 51? a. $1,790 b. $2,159 c. $2,508 d. $2, What is the amount on Form 40N, Line 54? a. $0 b. $134 c. $152 d. $ What is the amount on Form 40N, Line 71? a. 0 b. $379 c. $574 d. $962 6

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9 2010 Tax Law Quiz Answer Sheet Welcome to Oregon Part-Year Nonresident Student Name: Question # Answer Question # Answer Quiz instructions: Write your name at the top of this quiz answer sheet. You have 20 minutes to complete this quiz. This is a closed-book quiz. You may use a non-programmable calculator and the Exam Reference Sheet to calculate your answers. Choose only one correct answer for each question. If you believe there is more than one correct answer, choose the answer that is the most true. Write the letter from the quiz that corresponds with the correct answer beside each question # on this quiz answer sheet. If you would like to alert your instructor to a problem with this quiz, you may do so by writing your note or concern on this quiz answer sheet. Turn in this completed quiz answer sheet to your instructor. Retain the quiz questions for your records and do not hand them in 9