Is real estate withholding an additional tax on the sale of Oregon real property?
No. The withholding tax is not an additional tax due but instead a prepayment of tax, like estimated payments of a personal or corporate tax based on income. When you file your income tax return to determine your actual tax, the withholding will appear as a credit against any taxes you owe. If you have an overpayment, it will be refunded to you. Example: Steve had $9,000 withheld on the sale of Oregon rental property. When he filed Oregon Form 40N by the due date, his Oregon tax liability was $7,200. Steve received a refund of the $1,800 overpayment.
No. The withholding tax is not an additional tax due but instead a pre-payment of tax, like estimated payments, of a personal or corporate tax based on income. 3. What is the withholding calculation? The withholding required is the least of three amounts: • 4 percent of the consideration (sales price); • 4 percent of the net proceeds (amount disbursed to the seller); or • 10 percent of the gain that is includible in Oregon taxable income for the year. 4. When is withholding required? Generally, withholding is required when nonresident individuals or C corporations sell property located in Oregon if the sales price is greater than $100,000. Other exceptions to the withholding requirement may apply. See question 16 below. 5. When is withholding not required? Withholding is not required if the seller is a pass-through entity such as a partnership, S corporation, limited liability company (LLC), limited liability partnership (LLP), or certain trusts and estates. Withholding is also not req
