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(c) The maximum amount to be withheld under this section on any designated distribution shall
not exceed 10 percent of the amount of money and the fair market value of other property received
in the distribution. If the distribution is not subject to withholding for federal income tax purposes
under section 3405 of the Internal Revenue Code, it shall not be subject to withholding under this
section.
(3)(a) Except as provided in paragraph (b) of this subsection, the payer of a designated distrib-
ution shall withhold and be liable for payment of amounts required to be withheld under this section.
(b) In the case of any plan described in section 401(a), 403(a) or 457(b) of the Internal Revenue
Code, or section 301(d) of the Tax Reduction Act of 1975, the plan administrator shall withhold and
be liable for payment of amounts required to be withheld under this section, unless the plan ad-
ministrator has directed the payer to withhold the tax and has provided the payer with the infor-
mation required by rule of the department.
(4)(a) An individual may elect to have no withholding by a payer under subsection (2) of this
section. If an individual has elected to have no federal withholding from payments or distributions
described in this section the individual shall be deemed to have elected no withholding for state
purposes, unless the individual notifies the payer otherwise.
(b) An election made under this subsection shall be effective as provided under rules
promulgated by the department. The rules required under this paragraph shall provide the manner
in which an election may be revoked and when such revocation shall be effective.
(c) An election made under this subsection does not apply to amounts required to be
withheld under section 122a of this 2017 Act.
(5) The payer of any periodic payment or nonperiodic distribution shall give notice to the payee
of the right to make an election to have no state withholding from the payment or distribution. The
department shall provide by rule for the time and manner of giving the notice required under this
subsection.
(6) Any rules permitted or required to be promulgated by the department under this section
shall, insofar as is practicable, be consistent with corresponding provisions of section 3405 of the
Internal Revenue Code and regulations promulgated thereunder.
(7) Any designated distribution shall be treated as if it were wages paid by an employer to an
employee within the meaning of ORS 316.162 to 316.221 and section 122a of this 2017 Act for all
other purposes of ORS 316.162 to 316.221 and section 122a of this 2017 Act . In the case of any
designated distribution not subject to withholding by reason of an election under subsection (4) of
this section, the amount withheld shall be treated as zero.
SECTION 122e.
ORS 316.197 is amended to read:
316.197. (1)(a) Except as provided under ORS 316.191 or paragraph (b) of this subsection, within
the time that each employer is required to pay over taxes withheld for federal income tax purposes
for any period, the employer shall pay over to the Department of Revenue or to a financial agent
of the department the amounts required to be withheld under ORS 316.167 and 316.172 and section
122a of this 2017 Act for the same period. Any employer not required to withhold federal income
taxes for any period but who is required to deduct and retain amounts from wages paid to an em-
ployee under ORS 316.167 and 316.172 and section 122a of this 2017 Act for the same period shall
pay over to the department, or financial agent of the department, taxes withheld for the period,
within the time and in the manner, as if the employer were required to withhold taxes for the period
under federal law.
(b) Notwithstanding the provisions of paragraph (a) of this subsection, any employer of agricul-
tural employees who is not required to withhold federal income taxes for any period but who is re-
quired to deduct and retain amounts from wages paid to those employees under ORS 316.167 and
316.172 shall pay over to the department, or financial agent of the department, taxes so withheld
at the same time and for the same period for which the employer is required to pay over employer
and employee taxes under chapter 21 of the Internal Revenue Code (Federal Insurance Contributions
Act).
Enrolled House Bill 2017 (HB 2017-A) Page 112
Cite this record
Oregon Legislative Assembly. HB 2017 (2017), enrolled text, PDF p. 112. Retrieved 2026-09-04. https://olis.oregonlegislature.gov/liz/2017R1/Downloads/MeasureDocument/HB2017/Enrolled#page=112. Preserved SHA-256: 5ab76901b63ba88f2742eab37f5e9ddd922a3ffd53e76165eec6dd08f4f9282a. Atlas edition: institutional-studies-2026-09-27-stif-v2.