Oregon Severance Pay Subtraction (OBSOLETE)

Severance Pay Subtraction (OBSOLETE)
Schedule OR-SPS, Severance Pay Subtraction, 150-101-705
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Page 1 of 2, 150-101-705 (Rev. 12-17)

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Oregon Department of Revenue

Severance Pay Subtraction Schedule
Submit original form—do not submit photocopy.

Note: Only available for tax years beginning on or after January 1, 2010 and before January 1, 2014.
You must complete this form for each business you invest in and include it with your tax return for the year you claim the
subtraction. See instructions.
Last name

First name and initial

Social Security number (SSN)

–

–

Street address
State

City
Phone

(

)

ZIP code

Email address

–

PART A—Severance pay received information
Amount of severance pay received

.00

$

Date received

/

Name of employer

Date of termination

/

/

Phone

(

)

/

–

Employer’s street address
City

State

Type of business

ZIP code
Number of employees

Position/title at termination

PART B—Small business investment information
Name of business

Federal employer identification number (FEIN)

–

Street address
City

State

Type of business

ZIP code

Phone

(

Year business started

)

–

Type of entity

(1) Sole proprietorship

(2) Partnership

(7) S corporation

(3) LLP

(4) LLC

(5) LP

(6) C corporation

(8) Other

Check if business is:

(1) Independently owned/operated

(2) Operated for profit

Principal activity code
Your position/title
Describe your role/duties

Number of hours you worked in this business during
the tax year

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Schedule OR-SPS
Page 2 of 2, 150-101-705 (Rev. 12-17)

Oregon Department of Revenue

17140001020000

How has your severance pay investment impacted the small business?

How was/is your investment intended to be used? (Buy equipment, expansion, new hires, etc.)

Small business sales and employee information

Number of
employees

Yearly gross sales
(in dollars)

Previous year.................................	

.............................

$

.00

Year of investment
(actual or estimated).....................	

.............................

$

.00

One year
following investment
(estimated).....................................	

.............................

$

.00

Two years
following investment
(estimated).....................................	

.............................

$

.00

PART C—Severance pay subtraction calculation worksheet

.00

1.	 Enter the amount of severance pay actually invested in a qualifying small business....1. $

$500,000 .00

2.	 Enter $500,000 ..........................................................................................................2.
3.	 Enter the lesser of line 1 or 2......................................................................................3.

.00

$

.

4.	 Multiply by Oregon sales factor, if applicable.............................................................4.
5.	 Subtraction amount (line 3 times line 4 or enter line 3 if no sales factor)...................5.

%

.00

$

Enter the subtraction amount from line 5 on the “other subtractions” line on your Oregon tax return or Schedule OR-ASC.
Use subtraction code 349.
I have read and understand the requirements of this subtraction as outlined in this form. The information provided is correct and accurate according to my best information and belief.
Taxpayer’s signature

X

Date

/

/

Keep a copy of this form for your records. Include this form with your return in the year for which you are claiming
the subtraction.

Schedule OR-SPS Instructions
Page 1 of 1, 150-101-705 (Rev. 12-17)

Oregon Department of Revenue

Oregon Severance Pay Substraction Schedule Instructions
The severance pay subtraction is available for tax years 2010
through 2013. You may subtract severance pay when invested
in certain small businesses. You must claim the subtraction in
the same year you receive the severance pay.

General qualifications required to claim the
severance pay subtraction
Your severance pay investment:
•	 Cannot be invested in the same business that paid your
severance pay.
•	 Must occur before the due date of your tax return (including extensions).
•	 Cannot be a loan to a qualifying small business. (You must
receive an ownership interest.)
•	 Must stay invested in the business for 24 consecutive months. (If you withdraw any portion during the
24-month period, you must amend your tax return to
correct the subtraction amount.)
The business you are investing in must:
•	 Not have more than 50 employees, including yourself.
•	 Operate for profit (cannot be a nonprofit business).
•	 Be independently owned and operated from all other
businesses.
You must materially participate in the business (this means
you are regularly, continuously, and substantially involved
in the operation of the business).
You are considered to be materially participating if you:
•	 Worked more than 500 hours per year in the business;
•	 Worked more than 100 hours per year in the business and
at least as much as any other employee or owner; or
•	 Have performed substantially all of the work in the business.
Note: If you are using either the 500 or 100-hour qualification, you must keep a log of your time spent working in the
business.

Part A: Severance pay information
Severance pay is compensation (other than wages, vacation,
or sick pay) paid to you upon termination of your employment.

Part B: Small business information
The law requires us to collect information about the business
you have invested in. You must provide the following business
information in order to receive a subtraction:
•	 Name, address, and phone number.
•	FEIN.

•	 Year the business started.
•	 Information about number of employees and gross sales.
•	 Type of entity (partnership, sole proprietorship, C or S
Corporation, LLC, etc.).
•	 Business activity code as listed on one of the following
federal forms:
	—	Form 1065, line A;
	—	Schedule C, Form 1040, box B;
	—	Schedule K, line 2a; or
	—	Form 1120S, box B.
•	 Description of how your investment impacts the small
business (for example: buying hardware, new hires, marketing, expansion, etc.).

Part C: Severance pay subtraction calculation
worksheet
The subtraction is the lesser of your investment or $500,000.
If the business has operations outside of Oregon, you must
multiply line 4 by your sales factor.

Keeping records
You must keep current and complete records of your time
spent working in the business to show you meet the minimum material participation requirements. You must also
keep a monthly log of the amount of severance pay you
invested in the business for 24 months beginning with the
date of your termination.

Filing instructions
Include this form with your tax return for the year in which
you are claiming the subtraction. If you are filing electronically and your software does not support attaching this form
as a PDF, you may submit this form electronically using
Revenue Online at w
­ ww.oregon.gov/dor.

Taxpayer assistance
Do you have questions or need help?
­www.oregon.gov/dor
(503) 378-4988 or 1 (800) 356-4222
­[email protected]
Contact us for ADA accommodations or assistance in other
languages.