Oregon Revised Statutes

Or. Rev. Stat. § 316.032 (2026)

Department to administer law; policy as to federal conflicts and technical corrections

✓ current as of May 2026
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      316.032 Department to administer law; policy as to federal conflicts and technical corrections. (1) The Department of Revenue shall administer and enforce this chapter.

      (2) Insofar as is practicable in the administration of this chapter, the department shall apply and follow the administrative and judicial interpretations of the federal income tax law. When a provision of the federal income tax law is the subject of conflicting opinions by two or more federal courts, the department shall follow the rule observed by the United States Commissioner of Internal Revenue until the conflict is resolved. Nothing contained in this section limits the right or duty of the department to audit the return of any taxpayer or to determine any fact relating to the tax liability of any taxpayer.

      (3) When portions of the Internal Revenue Code incorporated by reference as provided in ORS 316.007 or 316.012 refer to rules or regulations prescribed by the Secretary of the Treasury, then such rules or regulations shall be regarded as rules adopted by the department under and in accordance with the provisions of this chapter, whenever they are prescribed or amended.

      (4)(a) When portions of the Internal Revenue Code incorporated by reference as provided in ORS 316.007 or 316.012 are later corrected by an Act or a Title within an Act of the United States Congress designated as an Act or Title making technical corrections, then notwithstanding the date that the Act or Title becomes law, those portions of the Internal Revenue Code, as so corrected, shall be the portions of the Internal Revenue Code incorporated by reference as provided in ORS 316.007 or 316.012 and shall take effect, unless otherwise indicated by the Act or Title (in which case the provisions shall take effect as indicated in the Act or Title), as if originally included in the provisions of the Act being technically corrected. If, on account of this subsection, any adjustment is required to an Oregon return that would otherwise be prevented by operation of law or rule, the adjustment shall be made, notwithstanding any law or rule to the contrary, in the manner provided under ORS 314.135.

      (b) As used in this subsection, “Act or Title” includes any subtitle, division or other part of an Act or Title. [1969 c.493 §10; 1985 c.802 §1a; 1987 c.293 §5; 1997 c.839 §3]

 

      316.035 [1953 c.304 §117; repealed by 1969 c.493 §99 and 1969 c.520 §49]

Notes of Decisions
Cited in 53 cases (10 in the last 5 years), 1972–2025 · leading case: Dept. of Rev. v. Wakefield, 25 Or. Tax 1 (Or. T.C. 2022).
Dept. of Rev. v. Wakefield, 25 Or. Tax 1 (Or. T.C. 2022). · cites it 28× “032(2) might be somewhat “obscure” outside the context of a classic split between two federal appellate circuits, but the court summed up the overall intent of the statute as follows: “[I]n case of a conflict ORS 316.032 instructs the Department to follow the rule observed by…”
Hillenga v. Dep't of Revenue, 361 P.3d 598 (Or. 2015). · cites it 2× “048 (generally, taxable income is as defined by federal law); 6 ORS 316.032(2) (directing department to “apply and follow the administrative and judicial interpretations of the federal income tax law”); 7 former ORS 316.”
Deblock v. Dep't of Revenue, 596 P.2d 560 (Or. 1979). · cites it 5× “When ORS 316.032, supra, instructs the Department to follow the "administrative and judicial interpretations” of the federal law, no doubt a decision of the United States Supreme Court is conclusive.”
Okorn v. Dep't of Revenue, 818 P.2d 928 (Or. 1991). · cites it 3× “054 (providing that certain provisions of the Internal Revenue Code do or do not apply; specifying rules for interpreting parallel state and federal provisions; and adopting federal rules and regulations as regulations of the Department). The legislature’s incorporation by…”
Christensen II v. Dept. of Rev., 23 Or. Tax 155 (Or. T.C. 2018). “057 requires the director to designate that employee in writing and to file the 7 These include the power to “administer and enforce” the personal income tax laws (ORS 316.032(1)), the power to make administrative rules (ORS 305.”
Hintz v. Dep't of Revenue, 13 Or. Tax 462 (Or. T.C. 1996). · cites it 2× “When a provision of the federal income tax law is the subject of conflicting opinions by two or more federal courts, the department shall follow the rule observed by the United States Commissioner of Internal Revenue until the conflict is resolved.”
Schuette v. Dep't of Revenue, 951 P.2d 690 (Or. 1997). · cites it 3× “011(3)i ** 4 and ORS 316.032(3), 5 federal law controls here and expressly permits *219 use of the aggregate method to calculate the federal tax credit for taxes paid to foreign countries.”
Dept. of Rev. v. Washington Fed., Inc., 20 Or. Tax 507 (Or. T.C. 2012). · cites it 2× “See ORS 316.032(2); ORS 317.013(2); Dept. of Rev.”
Harding v. Dep't of Revenue, 13 Or. Tax 454 (Or. T.C. 1996). “In adopting federal law, the Oregon legislature was cognizant of interpretive disputes among the federal courts and adopted ORS 316.032(2), which provides: “Insofar as is practicable in the administration of this chapter, the department shall apply and follow the administrative…”
Kirwan v. Dept. of Rev., 21 Or. Tax 424 (Or. T.C. 2014). “ORS 316.032(2). The department urges the court to adopt the mean- ing of “trade or business” found within the definition of “independent contractor” under ORS 670.”
Combs v. Dep't of Revenue, 14 P.3d 584 (Or. 2000). “Section 61(a)(1) of the Internal Revenue Code defines “gross income” to include “[cjompensation for services.”
Baisch v. Dep't of Revenue, 850 P.2d 1109 (Or. 1993). “effect to the provisions of the federal Internal Revenue Code relating to the measurement of taxable income of individuals * * *; to achieve this result by application of the various provisions of the federal Internal Revenue Code relating to the definition of income, exceptions…”
— Or. Rev. Stat. § 316.032(1) — 1 case
Christensen II v. Dept. of Rev., 23 Or. Tax 155 (Or. T.C. 2018). “057 requires the director to designate that employee in writing and to file the 7 These include the power to “administer and enforce” the personal income tax laws (ORS 316.032(1)), the power to make administrative rules (ORS 305.”
— Or. Rev. Stat. § 316.032(2) — 35 cases
Dept. of Rev. v. Wakefield, 25 Or. Tax 1 (Or. T.C. 2022). “032(2) might be somewhat “obscure” outside the context of a classic split between two federal appellate circuits, but the court summed up the overall intent of the statute as follows: “[I]n case of a conflict ORS 316.032 instructs the Department to follow the rule observed by…”
Hillenga v. Dep't of Revenue, 361 P.3d 598 (Or. 2015). “048 (generally, taxable income is as defined by federal law); 6 ORS 316.032(2) (directing department to “apply and follow the administrative and judicial interpretations of the federal income tax law”); 7 former ORS 316.”
Hintz v. Dep't of Revenue, 13 Or. Tax 462 (Or. T.C. 1996). “When a provision of the federal income tax law is the subject of conflicting opinions by two or more federal courts, the department shall follow the rule observed by the United States Commissioner of Internal Revenue until the conflict is resolved.”
Dept. of Rev. v. Washington Fed., Inc., 20 Or. Tax 507 (Or. T.C. 2012). “See ORS 316.032(2); ORS 317.013(2); Dept. of Rev.”
Harding v. Dep't of Revenue, 13 Or. Tax 454 (Or. T.C. 1996). “In adopting federal law, the Oregon legislature was cognizant of interpretive disputes among the federal courts and adopted ORS 316.032(2), which provides: “Insofar as is practicable in the administration of this chapter, the department shall apply and follow the administrative…”
— Or. Rev. Stat. § 316.032(3) — 5 cases
Schuette v. Dep't of Revenue, 951 P.2d 690 (Or. 1997). “011(3)i ** 4 and ORS 316.032(3), 5 federal law controls here and expressly permits *219 use of the aggregate method to calculate the federal tax credit for taxes paid to foreign countries.”
Okorn v. Dep't of Revenue, 818 P.2d 928 (Or. 1991). “054 (providing that certain provisions of the Internal Revenue Code do or do not apply; specifying rules for interpreting parallel state and federal provisions; and adopting federal rules and regulations as regulations of the Department). The legislature’s incorporation by…”
Pauly v. Dept. of Rev. (Or. T.C. 2020).
Williams v. Dept. of Rev. (Or. T.C. 2022).
Est. of Helene J. Evans v. Dept. of Rev., 24 Or. Tax 126 (Or. T.C. 2020).
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