The Taxpayer Defense Center continues its fight against Oregon’s attempt to force Steven and Sarah Speer to pay taxes to both Wisconsin and Oregon for the same income. Our latest brief responds to and refutes the Oregon Department of Revenue’s attempt to double tax the income.
The Speers invested in a Wisconsin brewery. The brewery only operates in Wisconsin and pays taxes to Wisconsin on behalf of its owners. Wisconsin also has a series of tax credits aimed at supporting in-state industry. The brewery does not have any activity in Oregon. But, when the Speers moved part time to Oregon, the Beaver State state decided it also wants to tax the brewery’s income, while refusing to recognize a Wisconsin credit the brewery receives for investing in Wisconsin. In effect, Wisconsin grants a credit to the Speers that Oregon then confiscates.
At issue is ORS § 316.082(1), which issues a tax credit to Oregon residents “for the amount of any income tax imposed on the individual, or on an Oregon S corporation . . . for the tax year by another state on income derived from sources therein and that is also subject to tax under this chapter.” The correct interpretation of ORS § 316.082(1) is that a credit is provided for the taxes “imposed” by other states. That’s what the plain text of the law says. But Oregon’s Department of Revenue disagrees, saying credit is only available to what the Speers actually paid. Because Wisconsin gives a substantial tax credit, Oregon wishes to ignore that amount and only credit what came out of the Speer’s bank account. This creates a windfall for Oregon, which gets taxes that should not be due under ORS § 316.082(1).
NTUF’s Taxpayer Defense Center stepped in to fight this battle. In May 2025, a magistrate in the Oregon Tax Court ruled against NTUF, holding that Oregon was correct to deny the Speers credit for taxes paid in Wisconsin. NTUF appealed the ruling to a judge in the Oregon Tax Court in July 2025. NTUF filed a motion for summary judgment in December 2025, and the state responded in February 2026. We filed our response in April 2026.
As discussed in our latest brief, the Department’s interpretation of ORS § 316.082(1) as offering a credit only for taxes “paid” instead of “imposed” ignores the statute’s plain language, context, and legislative history. We walk through dictionary definitions, both the specialized Black’s Law Dictionary (used by legislators, lawyers, and judges across the county), and Webster’s Dictionary (both at the time of the passage of ORS § 316.082(1) and today), to show that “imposed” does not mean “paid directly from a taxpayers bank account.” This plain meaning, and how tax credits are really just having the government partially pay a tax, have already been recognized by the Oregon Supreme Court in Con-Way Inc. & Affiliates v. Department of Revenue. Con-Way held that (1) a tax credit functions as a form of payment to satisfy a tax liability, not as a retroactive reduction of the tax imposed; and (2) the legislature must be explicit when it intends to deny the use of a credit. Extensive research into the legislative history of ORS § 316.082 also supports this direct reading of the statute.
Unlike the typical tax credit that is a gift of a legislature to promote public policy objectives, this tax credit of ORS § 316.082(1) operates to avoid the very real possibility of double taxing the income of a business via a resident—all for activity wholly outside the borders of Oregon. Thus, the tax credit is a constitutional bulwark to comply with important United States Supreme Court mandates under the Due Process and Dormant Commerce Clauses. There has to be some connection between the activity taxed and the state issuing the levy. Since the income generated in this case is from an out-of-state brewery and the only connection to Oregon is the brewery’s minority shareholders in the S-Corporation, Oregon’s tax interest is too tenuous to pass constitutional muster. Everyone, therefore, should want ORS § 316.082(1) to work and be effective.
This case is vital because Oregon’s argument sets a dangerous precedent for allowing extra taxes if a resident invests out-of-state. By taxing the same income already taxed by Wisconsin and then directing that Wisconsin credits be disallowed in calculating Oregon’s tax, Oregon is effectively placing a tariff on the Speers’ out-of-state business activity.
NTUF’s Taxpayer Defense Center will continue to protect small business owners from arbitrary and excessive taxation. The case is Speer v. Department of Revenue, TC No. 5482. Stay tuned for further developments.