Chapter 130 Oregon Laws 2007
AN ACT
HB 2361
Relating to partial liquidations; amending ORS 129.300.
Be It Enacted by the People of
the State of Oregon:
SECTION 1.
ORS 129.300 is amended to read:
129.300. (1) In this
section, “entity” means a corporation, partnership, limited liability company,
regulated investment company, real estate investment trust, common trust fund
or any other organization in which a trustee has an interest other than a trust
or estate to which ORS 129.305 applies, a business or activity to which ORS
129.308 applies or an asset-backed security to which ORS 129.385 applies.
(2) Except as otherwise
provided in this section, a trustee shall allocate to income money received
from an entity.
(3) A trustee shall
allocate the following receipts from an entity to principal:
(a) Property other than
money;
(b) Money received in
one distribution or a series of related distributions in exchange for part or
all of a trust’s interest in the entity;
(c) Money received in
total or partial liquidation of the entity; and
(d) Money received from
an entity that is a regulated investment company or a real estate investment
trust if the money distributed is a capital gain dividend for federal income
tax purposes.
(4) Money is received in
partial liquidation:
(a) To the extent that
the entity, at or near the time of a distribution, indicates that it is a
distribution in partial liquidation; or
(b) If the total amount
of money and property [received] distributed
by an entity in a distribution or series of related distributions is
greater than 20 percent of the entity’s gross assets, as shown by the entity’s
year-end financial statements immediately preceding the initial [receipt] distribution.
(5) Money is not
received in partial liquidation, nor may it be taken into account under
subsection (4)(b) of this section, to the extent that it does not exceed the
amount of income tax that a trustee or beneficiary must pay on taxable income
of the entity that distributes the money.
(6) A trustee may rely
upon a statement made by an entity about the source or character of a
distribution if the statement is made at or near the time of distribution by
the entity’s board of directors or other person or group of persons authorized
to exercise powers to pay money or transfer property comparable to those of a
corporation’s board of directors.
Approved by the Governor May 9, 2007
Filed in the office of Secretary of State May 10, 2007
Effective date January 1, 2008
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