OR-FCG: Worksheet OR-FCG, Farm Liquidation Long-Term Capital Gain Tax Rate (2024)
Oregon · Oregon DOR · Used for tax years 2024
Oregon Worksheet OR-FCG calculates Oregon tax using a 5 percent rate on qualifying net long-term capital gain from farm assets. It combines that tax with the tax on your remaining taxable income to determine the amount to enter on your Oregon return. Keep the worksheet with your
Who files this form
Worksheet FCG is for figuring Oregon tax if you qualify for the reduced tax rate on net long-term capital gain from farm assets. You do not include the worksheet with your return.
You may qualify if you sold or exchanged capital assets used in farming and the transaction ended all your ownership interests in a farming business or in property used in a farming business.
- You do not qualify if you had a net loss from sales or exchanges of all types of assets during the year.
- A sale or exchange to a relative, as defined in Internal Revenue Code Section 267, does not qualify.
- A farm dwelling or farm home site is not considered property used in the farming business.
- For a sale of ownership interests in a farming corporation, partnership, or other entity, you must have owned at least 10 percent of the entity before the sale or exchange.
What you'll need
To complete the worksheet, have these amounts available:
- Your net long-term capital gain from farm assets.
- The gain included in Oregon income, or the gain in the Oregon column of Form OR-40-N or Form OR-40-P, line 13S.
- Your Oregon taxable income from Form OR-40, line 19; Form OR-40-N, line 45; or Form OR-40-P, line 43.
How to file
Do not include Worksheet FCG with your return. Keep it with your tax records.
Enter the Oregon tax calculated on worksheet line 9 on the applicable return line:
- Form OR-40, line 20.
- Form OR-40-N, line 46.
- Form OR-40-P, line 44.
Check the box on your Oregon return labeled “Worksheet FCG.”
Common mistakes
- Sending the worksheet with your return. Keep it with your tax records instead.
- Forgetting the checkbox. Check “Worksheet FCG” on your Oregon return.
- Claiming the reduced rate when you have an overall net loss. A net loss from sales or exchanges of all types of assets during the year makes you ineligible.
- Claiming the reduced rate on a sale or exchange to a relative. The form excludes relatives as defined in Internal Revenue Code Section 267.
- Treating a farm dwelling or farm home site as qualifying farm property. The form says these are not property used in the farming business.
Questions people ask
What farming activities are covered?
The form lists activities such as raising and selling crops; raising or managing livestock, poultry, and honeybees; dairying; stabling or training equines; and growing or harvesting aquatic species. It also includes other agricultural or horticultural activities and animal husbandry.
Does growing timber count as farming?
The form includes growing and harvesting cultured Christmas trees or certain hardwood timber. It excludes growing and harvesting other trees of a marketable species.
Can selling an ownership interest in a farming entity qualify?
Yes. The form allows qualifying sales of ownership interests in a farming corporation, partnership, or other entity. You must have held at least a 10 percent ownership interest before the sale or exchange, and the transaction must meet the form's requirement to end all applicable ownership interests.
How does the worksheet apply the 5 percent rate?
The worksheet takes the smaller of the qualifying gain on line 3 or Oregon taxable income on line 4, then multiplies that amount by 5 percent. It adds that tax to the Oregon tax on modified taxable income to determine your Oregon tax.
What if the gain on line 3 is more than my Oregon taxable income on line 4?
Enter 0 on line 5 for modified taxable income.