Chapter 575 Oregon Laws 2005

AN ACT

HB 3358

Relating to individual development accounts.

Be It Enacted by the People of the State of Oregon:

SECTION 1. Section 2 of this 2005 Act is added to and made a part of ORS chapter 315.

SECTION 2. (1) An individual taxpayer shall be allowed a credit against the taxes that are otherwise due under ORS chapter 316 if, during the tax year:

(a) The taxpayer purchased a primary residence;

(b) All or a part of the usual and reasonable settlement, financing or other closing costs for the purchase were funded from a withdrawal from an individual development account in which the taxpayer is the account holder; and

(c) An approved purpose of the account is the purpose described in ORS 458.685 (1)(d).

(2) The amount of the tax credit shall be the lesser of:

(a) The amount of the withdrawal from the individual development account that is for the purpose described in ORS 458.685 (1)(d);

(b) The amount of usual and reasonable settlement, financing and other closing costs incurred in the purchase of the primary residence;

(c) $2,000; or

(d) The tax liability of the taxpayer.

(3) A tax credit allowed under this section that is unused may not be carried forward to a succeeding tax year.

(4) A tax credit under this section may be claimed by a nonresident or a part-year resident without proration.

(5) The definitions in ORS 458.670 apply to this section.

SECTION 3. Section 2 of this 2005 Act applies to tax years beginning on or after January 1, 2006.

Approved by the Governor July 20, 2005

Filed in the office of Secretary of State July 20, 2005

Effective date January 1, 2006

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