As the deadline approaches to make estimated Corporate Activity Tax (CAT) payments for the second quarter, the Oregon Department of Revenue reminds taxpayers of relief available to those businesses negatively affected by the COVID-19 pandemic.
As adopted in administrative rule 150-317-1500, the department will honor a business taxpayer’s good-faith efforts to comply with the CAT and not assess penalties if they document their efforts to comply, including how COVID-19 has impacted their business.
If businesses know they’ll owe $10,000 or more in annual corporate activity tax in 2020 and can pay, they should make estimated quarterly payments and comply with the law to the fullest extent possible.
However, penalties will not be assessed for underestimated quarterly payments or for not making a quarterly payment for the Corporate Activity Tax, if businesses don’t have the financial ability to make the estimated payment.
If businesses have been impacted by COVID-19 and are finding it difficult to calculate or pay an estimated quarterly payment, they should keep documentation showing:
- Their inability to pay a quarterly payment because of insufficient funds due to COVID-19.
- Their inability to reasonably calculate a quarterly payment or annual tax liability due to their business being impacted by COVID-19.
- That the taxpayer is unclear at this time whether the business will owe corporate activity tax in April 2020 due to COVID-19 impacts, after taking into consideration exclusions and subtractions in the law.
Businesses uncertain about their economic future due to the COVID-19 crisis, or those that have been closed during this crisis and have no ability to determine that they will owe a tax this year, won’t be penalized.
Registration for the CAT is still required. Businesses must register within 30 days of reaching $750,000 in Oregon commercial activity in the calendar year. Registration is available through Revenue Online and the department offers a series of online resources to help with registration on the CAT page of the agency’s website.
The CAT webpage also includes links to the administrative rules that govern the tax, a list of basic frequently asked questions (FAQ), and a Beyond the FAQ section that includes high-level summaries of the rules and other topics to help answer taxpayer questions.
Taxpayers with general questions about the CAT can email cat.help.dor@oregon.gov or call 503-945-8005.
Visit oregon.gov/dor to get tax forms, check the status of your refund or make tax payments; call 800-356-4222 toll-free from an Oregon prefix (English or Spanish); 503-378-4988 in Salem and outside Oregon; or email questions.dor@oregon.gov. For TTY (hearing or speech impaired), call 800-886-7204.
