Bill Text: OR HB2461 | 2013 | Regular Session | Introduced
Bill Title: Relating to tax obligations of persons seeking to form business entities; declaring an emergency.
Spectrum: Committee Bill
Status: (Failed) 2013-07-08 - In committee upon adjournment. [HB2461 Detail]
Download: Oregon-2013-HB2461-Introduced.html
77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1242
House Bill 2461
Introduced and printed pursuant to House Rule 12.00. Presession
filed (at the request of House Interim Committee on Revenue)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Requires person that seeks to form business entity to comply
with person's obligations under tax laws of state.
Requires Secretary of State to verify that person that seeks to
form business entity has complied with person's obligations under
tax laws of state. Prohibits Secretary of State from filing
articles of incorporation, articles of organization or other
documents required to form business entity until person that
seeks to form business entity has complied in full with person's
obligations under tax laws of state.
Becomes operative 91 days after effective date of Act.
Declares emergency, effective on passage.
A BILL FOR AN ACT
Relating to tax obligations of persons seeking to form business
entities; creating new provisions; amending ORS 58.085, 60.044,
62.511, 63.044, 65.044, 67.500, 70.075 and 128.575; and
declaring an emergency.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 58.085 is amended to read:
58.085. { + (1) Except as provided in subsection (2) of this
section, + }one or more natural persons may act as incorporators
of a professional corporation by delivering articles of
incorporation to the Office of Secretary of State for filing. The
articles of incorporation shall meet the requirements of the
Oregon Business Corporation Act and, in addition, shall set
forth:
{ - (1) - } { + (a) + } The professional service or
services to be rendered through the corporation.
{ - (2) - } { + (b) + } Any other business purposes
permitted under ORS 58.076.
{ + (2)(a) A natural person may not act as an incorporator
for a professional corporation unless the natural person has
complied with the natural person's obligations under the tax laws
of the State of Oregon. Before filing articles of incorporation
under this chapter, the Secretary of State shall verify with the
Department of Revenue that all of the natural persons that seek
to act as incorporators for a professional corporation have
complied with the natural persons' obligations under the tax laws
of this state. Notwithstanding the provisions of this chapter
that require the Secretary of State to file documents as a
ministerial duty, the Secretary of State may not file articles of
incorporation for a professional corporation until every natural
person that seeks to act as an incorporator for the professional
corporation has complied in full with the natural person's
obligations under the tax laws of this state.
(b) For purposes of this subsection, a natural person has
complied with the natural person's obligations under the tax laws
of this state if the Department of Revenue determines that the
natural person has complied, as appropriate, with:
(A) The personal income tax laws of this state, including the
withholding laws in ORS 316.162 to 316.221;
(B) The corporate excise or income tax laws of this state; and
(C) The provisions of ORS 323.005 to 323.482 or 323.500 to
323.645. + }
SECTION 2. ORS 60.044 is amended to read:
60.044. { + (1) Except as provided in subsection (2) of this
section, + }one or more individuals 18 years of age or older, a
domestic or foreign corporation, a partnership or an association
may act as incorporators of a corporation by delivering articles
of incorporation to the office { + of the Secretary of State + }
for filing.
{ + (2)(a) An individual, a corporation, a partnership or an
association may not act as an incorporator for a corporation
unless the individual, corporation, partnership or association
has complied with the individual's, corporation's, partnership's
or association's obligations under the tax laws of the State of
Oregon. Before filing articles of incorporation under this
chapter, the Secretary of State shall verify with the Department
of Revenue that each of the individuals, corporations,
partnerships or associations that seeks to act as an incorporator
has complied with the individual's, corporation's, partnership's
or association's obligations under the tax laws of this state.
Notwithstanding the provisions of this chapter that require the
Secretary of State to file documents as a ministerial duty, the
Secretary of State may not file articles of incorporation for a
corporation until every individual, corporation, partnership or
association that seeks to act as an incorporator for the
corporation has complied in full with the individual's,
corporation's, partnership's or association's obligations under
the tax laws of this state.
(b) For purposes of this subsection, an individual,
corporation, partnership or association has complied with the
individual's, corporation's, partnership's or association's
obligations under the tax laws of this state if the Department of
Revenue determines that the individual, corporation, partnership
or association has complied, as appropriate, with:
(A) The personal income tax laws of this state, including the
withholding laws in ORS 316.162 to 316.221;
(B) The corporate excise or income tax laws of this state; and
(C) The provisions of ORS 323.005 to 323.482 or 323.500 to
323.645. + }
SECTION 3. ORS 62.511 is amended to read:
62.511. { + (1) Except as provided in subsection (2) of this
section, + } one or more individuals 18 years of age or older, a
domestic or foreign corporation or cooperative, a partnership or
an association may act as incorporators of a cooperative by
delivering articles of incorporation to the Office of Secretary
of State for filing.
{ + (2)(a) An individual, a corporation, a cooperative, a
partnership or an association may not act as an incorporator for
a cooperative unless the individual, corporation, cooperative,
partnership or association has complied with the individual's,
corporation's, cooperative's, partnership's or association's
obligations under the tax laws of the State of Oregon. Before
filing articles of incorporation under this chapter, the
Secretary of State shall verify with the Department of Revenue
that each of the individuals, corporations, cooperatives,
partnerships or associations that seeks to act as an incorporator
has complied with the individual's, corporation's, cooperative's,
partnership's or association's obligations under the tax laws of
this state. Notwithstanding the provisions of this chapter that
require the Secretary of State to file documents as a ministerial
duty, the Secretary of State may not file articles of
incorporation for a cooperative until every individual,
corporation, cooperative, partnership or association that seeks
to act as an incorporator for the cooperative has complied in
full with the individual's, corporation's, cooperative's,
partnership's or association's obligations under the tax laws of
this state.
(b) For purposes of this subsection, an individual,
corporation, cooperative, partnership or association has complied
with the individual's, corporation's, cooperative's,
partnership's or association's obligations under the tax laws of
this state if the Department of Revenue determines that the
individual, corporation, cooperative, partnership or association
has complied, as appropriate, with:
(A) The personal income tax laws of this state, including the
withholding laws in ORS 316.162 to 316.221;
(B) The corporate excise or income tax laws of this state; and
(C) The provisions of ORS 323.005 to 323.482 or 323.500 to
323.645. + }
SECTION 4. ORS 63.044 is amended to read:
63.044. { + (1) Except as provided in subsection (2) of this
section, + } one or more individuals 18 years of age or older or
other entities may form a limited liability company by executing
and delivering articles of organization to the office { + of the
Secretary of State + } for filing. Organizers need not be members
of the limited liability company.
{ + (2)(a) An individual or entity may not form a limited
liability company unless the individual or entity has complied
with the individual's or entity's obligations under the tax laws
of the State of Oregon. Before filing articles of organization
under this chapter, the Secretary of State shall verify with the
Department of Revenue that each of the individuals or entities
that seek to form a limited liability company has complied with
the individual's or entity's obligations under the tax laws of
this state. Notwithstanding the provisions of this chapter that
require the Secretary of State to file documents as a ministerial
duty, the Secretary of State may not file articles of
organization for a limited liability company until every
individual or entity that seeks to form a limited liability
company has complied in full with the individual's or entity's
obligations under the tax laws of this state.
(b) For purposes of this subsection, an individual or entity
has complied with the individual's or entity's obligations under
the tax laws of this state if the Department of Revenue
determines that the individual or entity has complied, as
appropriate, with:
(A) The personal income tax laws of this state, including the
withholding laws in ORS 316.162 to 316.221;
(B) The corporate excise or income tax laws of this state; and
(C) The provisions of ORS 323.005 to 323.482 or 323.500 to
323.645. + }
SECTION 5. ORS 65.044 is amended to read:
65.044. { + (1) Except as provided in subsection (2) of this
section, + } one or more individuals 18 years of age or older, a
domestic or foreign corporation, a partnership or an association
may act as incorporators of a corporation by delivering articles
of incorporation to the Secretary of State for filing.
{ + (2)(a) An individual, a corporation, a partnership or an
association may not act as an incorporator for a corporation
unless the individual, corporation, partnership or association
has complied with the individual's, corporation's, partnership's
or association's obligations under the tax laws of the State of
Oregon. Before filing articles of incorporation under this
chapter, the Secretary of State shall verify with the Department
of Revenue that each of the individuals, corporations,
partnerships or associations that seeks to act as an incorporator
has complied with the individual's, corporation's, partnership's
or association's obligations under the tax laws of this state.
Notwithstanding the provisions of this chapter that require the
Secretary of State to file documents as a ministerial duty, the
Secretary of State may not file articles of incorporation for a
corporation until every individual, corporation, partnership or
association that seeks to act as an incorporator for the
corporation has complied in full with the individual's,
corporation's, partnership's or association's obligations under
the tax laws of this state.
(b) For purposes of this subsection, an individual,
corporation, partnership or association has complied with the
individual's, corporation's, partnership's or association's
obligations under the tax laws of this state if the Department of
Revenue determines that the individual, corporation, partnership
or association has complied, as appropriate, with:
(A) The personal income tax laws of this state, including the
withholding laws in ORS 316.162 to 316.221;
(B) The corporate excise or income tax laws of this state; and
(C) The provisions of ORS 323.005 to 323.482 or 323.500 to
323.645. + }
SECTION 6. ORS 67.500 is amended to read:
67.500. (1) { + (a) + } Notwithstanding any other provision of
this chapter, a partnership, not including a limited partnership,
may register as a limited liability partnership or apply for
authority as a foreign limited liability partnership only if
{ - it - } :
{ - (a) - } { + (A) The partnership:
(i) + } Renders professional service; or
{ - (b) - } { + (ii) + } Is affiliated with a limited
liability partnership or a foreign limited liability partnership
that renders professional service and { - renders services
related to or complementary to the professional service rendered
by, or provides services or facilities to, the limited liability
partnership or foreign limited liability partnership that renders
professional service - } { + the partnership renders services
that complement or are related to professional services that the
limited liability partnership or foreign limited liability
partnership renders, or the partnership provides facilities or
services to a limited liability partnership or foreign limited
liability partnership that renders professional services; and
(B) The partnership and the individuals or entities that
constitute the partnership have complied with, as appropriate,
the partnership's, individual's or entity's obligations under the
tax laws of the State of Oregon. Before registering a partnership
as a limited liability partnership or granting authority to a
partnership as a foreign limited liability partnership, the
Secretary of State shall verify with the Department of Revenue
that the partnership or an individual or entity that is a partner
in the partnership has complied with the partnership's,
individual's or entity's obligations under the tax laws of this
state. Notwithstanding the provisions of this chapter that
require the Secretary of State to file documents as a ministerial
duty, the Secretary of State may not file an application for
registration as a limited liability partnership or for authority
as a foreign limited liability partnership until the partnership
and every individual or entity that is a partner in the
partnership have complied in full with the partnership's,
individual's or entity's obligations under the tax laws of this
state.
(b) For purposes of this subsection, a partnership, individual
or entity has complied with the partnership's, individual's or
entity's obligations under the tax laws of this state if the
Department of Revenue determines that the partnership, individual
or entity has complied, as appropriate, with:
(A) The personal income tax laws of this state, including the
withholding laws in ORS 316.162 to 316.221;
(B) The corporate excise or income tax laws of this state; and
(C) The provisions of ORS 323.005 to 323.482 or 323.500 to
323.645 + }.
(2) For purposes of subsection (1) { + (a)(A)(ii) + } of this
section, a partnership is affiliated with a limited liability
partnership or foreign limited liability partnership that renders
professional services if:
(a) At least a majority of partners in one partnership are
partners in the other partnership;
(b) At least a majority of the partners in each partnership
also are partners or hold interest in another person and each
partnership renders services pursuant to an agreement with
{ - such - } { + the + } other person; or
(c) One partnership directly or indirectly through one or more
intermediaries controls, is controlled by or is under common
control with the other partnership.
(3) The terms and conditions by which a partnership becomes a
limited liability partnership and a decision to cancel
registration as a limited liability partnership must be approved
by either:
(a) The vote of the partners necessary to amend the partnership
agreement; or
(b) In the case of a partnership agreement that includes
provisions that expressly address the obligations of partners to
make contributions to cover partnership losses, the vote of the
partners necessary to amend such provisions.
SECTION 7. ORS 70.075 is amended to read:
70.075. (1) To form a limited partnership, a certificate of
limited partnership must be executed and submitted for filing to
the Office of Secretary of State. The certificate { - shall - }
{ + must + } set forth the following:
(a) The name of the limited partnership.
(b) The address of the office { - required to be
maintained - } { + the limited partnership must maintain + }
under ORS 70.020 and the name and street address of the agent.
(c) A mailing address to which the Secretary of State may mail
notices as { - required by - } this chapter { + requires + }.
(d) The name and the business address of each general partner.
(e) The latest date upon which the limited partnership is to
dissolve.
(f) Any other matters the general partners decide to include in
the certificate.
(g) Any additional identifying information that the Secretary
of State may require by rule.
(2) { + (a) Subject to the requirements set forth in paragraph
(b) of this subsection, + } a limited partnership is formed when
the Secretary of State has filed the certificate or at any later
time specified in the certificate of limited partnership if, in
either case, there has been substantial compliance with the
requirements of this section.
{ + (b) Before filing a certificate of limited partnership,
the Secretary of State shall verify with the Department of
Revenue that each of the general partners in the proposed limited
partnership has complied with the general partners' obligations
under the tax laws of the State of Oregon. Notwithstanding the
provisions of this chapter that require the Secretary of State to
file documents as a ministerial duty, the Secretary of State may
not file a certificate of limited partnership until every general
partner in the proposed limited partnership has complied in full
with the general partner's obligations under the tax laws of this
state.
(c) For purposes of this subsection, a general partner has
complied with the general partner's obligations under the tax
laws of this state if the Department of Revenue determines that
the general partner has complied, as appropriate, with:
(A) The personal income tax laws of this state, including the
withholding laws in ORS 316.162 to 316.221;
(B) The corporate excise or income tax laws of this state; and
(C) The provisions of ORS 323.005 to 323.482 or 323.500 to
323.645. + }
SECTION 8. ORS 128.575 is amended to read:
128.575. (1) { - Any - } { + A + } business trust
{ - desiring - } { + that intends + } to do business in this
state shall first submit to the Office of Secretary of State a
copy of the trust instrument { - creating - } { + that
created + } the trust and any subsequent amendments to the trust
and a document { - setting - } { + that sets + } forth:
(a) The business trust name and the state or country of
formation;
(b) The names and addresses of { - its - } { + the business
trust's + } trustees;
(c) The street address of the business trust's registered
office in this state and the name of the registered agent;
(d) A mailing address to which the Secretary of State may mail
notices; and
(e) Any additional identifying information that the Secretary
of State by rule may require.
(2) The filing described in subsection (1) of this section
{ - shall - } { + must + } be accompanied by the applicable
filing fee.
(3) { + (a) + } If the Secretary of State finds that the
document contains the required information { + and has made the
verification required under paragraph (b) of this subsection + },
the Secretary of State, when all fees have been paid, shall file
the trust instrument and document and return an acknowledgment of
filing to the sender.
{ + (b) Before filing the trust instrument and document under
this section, the Secretary of State shall verify with the
Department of Revenue that each of the trustees of the business
trust has complied with the trustee's obligations under the tax
laws of the State of Oregon. The Secretary of State may not file
a trust instrument and document under this section until every
trustee of the business trust has complied in full with the
trustee's obligations under the tax laws of this state.
(c) For purposes of this subsection, a trustee has complied
with the trustee's obligations under the tax laws of this state
if the Department of Revenue determines that the trustee has
complied, as appropriate, with:
(A) The personal income tax laws of this state, including the
withholding laws in ORS 316.162 to 316.221;
(B) The corporate excise or income tax laws of this state; and
(C) The provisions of ORS 323.005 to 323.482 or 323.500 to
323.645. + }
(4) If a business trust amends { - its - } { + the business
trust's + } trust instrument { + , + } { - it - } { + the
business trust + } shall submit for filing a copy of the
amendment to the Office of Secretary of State. The amendment
shall set forth:
(a) The name of the business trust as shown on the records of
the Office of Secretary of State; and
(b) The information as changed.
SECTION 9. { + (1) The amendments to ORS 58.085, 60.044,
62.511, 63.044, 65.044, 67.500, 70.075 and 128.575 by sections 1
to 8 of this 2013 Act become operative 91 days after the
effective date of this 2013 Act.
(2) The Secretary of State may take any action before the
operative date specified in subsection (1) of this section that
is necessary to enable the Secretary of State to exercise, on and
after the operative date specified in subsection (1) of this
section, all of the duties, functions and powers conferred on the
Secretary of State by the amendments to ORS 58.085, 60.044,
62.511, 63.044, 65.044, 67.500, 70.075 and 128.575 by sections 1
to 8 of this 2013 Act. + }
SECTION 10. { + This 2013 Act being necessary for the
immediate preservation of the public peace, health and safety, an
emergency is declared to exist, and this 2013 Act takes effect on
its passage. + }
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