Oregon – Gross receipts from one-time sale of intangible assets excluded from sales factor

A manufacturer and retailer of electronics equipment was not required to include in its Oregon sales factor gross receipts from the sale of intangible assets relating to the sale of its printer division. The Oregon Supreme Court held that the taxpayer was not engaged in the business of selling business divisions, and therefore gross receipts from related intangible asset sales (e.g., goodwill) were not included in the taxpayer’s Oregon sales factor. The decision appears to broaden the Oregon sales factor’s intangible asset sale exclusion. Oregon taxpayers that included sales of non-liquid intangible assets in their Oregon sales factor should consider whether this decision impacts their prior Oregon tax return filings.

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