OR-FIA-40: Schedule OR-FIA-40, Oregon Farm Income Averaging for Full-year Residents (2024)
Oregon · Oregon DOR · Used for tax years 2024
Schedule OR-FIA-40 is Oregon’s farm income averaging schedule for full-year residents. It calculates 2024 tax using elected farm income and the 2021, 2022, and 2023 base years, then compares that amount with tax without farm income averaging. Keep this schedule with your records
Who files this form
Schedule OR-FIA-40 is for full-year Oregon residents calculating their 2024 tax using farm income averaging (FIA).
If FIA does not reduce your Oregon tax, the form directs you to complete your return without using FIA. Do not include this schedule with your Oregon return. Keep it with your records.
What you'll need
Have these items available to complete the schedule:
- Your 2024 Form OR-40, including taxable income from line 19.
- Your 2021, 2022, and 2023 Oregon returns for the base-year income and tax amounts.
- Oregon tax tables or rate charts for 2024 and each of the three base years.
- Your 2024 elected farm income amount.
- Your name and SSN, and your spouse’s name and SSN where applicable.
- Schedule OR-FIA-COMP, if applicable, for recomputed base-year tax.
The form directs you to consult the instructions if you used FIA in a base year, filed a nonresident or part-year resident return in a base year, or had base-year taxable income of $0 or less. Those instructions are not included in the supplied text.
How to file
Do not include Schedule OR-FIA-40 with your Oregon return. Keep it with your records.
After completing the calculations, compare line 22, tax using FIA, with line 23, tax without FIA:
- If line 22 is less than line 23, enter line 22’s amount on line 24 and on Form OR-40, line 20. Check box 20a on Form OR-40.
- If line 22 is not less than line 23, complete your return without using FIA.
Common mistakes
- Entering too much elected farm income. Line 2 cannot exceed the taxable income on line 1.
- Overlooking special base-year rules. The form directs you to the instructions if you used FIA or filed a nonresident or part-year resident return for any base year. It also directs you to the instructions when base-year taxable income is $0 or less.
- Using FIA when it does not lower your tax. If line 22 is not less than line 23, complete your return without FIA.
- Sending the schedule with your return. The form says to keep it with your records instead.
Questions people ask
Which base years does the 2024 schedule use?
It uses 2021, 2022, and 2023.
How is elected farm income divided among the base years?
Line 6 divides your 2024 elected farm income from line 2 by three. That same amount is used for each base year on lines 6, 10, and 14.
How do I know whether FIA lowers my Oregon tax?
Compare line 22 with line 23. FIA lowers your tax only if line 22 is less than line 23. If it is not, complete your return without FIA.
Do I send this schedule with my Oregon return?
No. Keep Schedule OR-FIA-40 with your records. If FIA lowers your tax, transfer the amount from line 22 to line 24 and Form OR-40, line 20, and check box 20a on Form OR-40.