Final answer:
It is false that beneficiaries of federal pensions cannot take the federal pension subtraction on their Oregon return. One can subtract some of the federal pension income provided certain conditions are met and their total income does not disqualify them from using Form 10402.
Step-by-step explanation:
If you are the beneficiary of a federal pension, it is false that you may not take the federal pension subtraction on your Oregon return. In fact, you are allowed to subtract some of your federal pension income from your Oregon taxable income.
However, there are conditions to be met. If the total amount of certain types of income, including unemployment compensation and Alaska Permanent Fund dividends, exceeds $1,500, you would not be eligible to use Form 10402.
Additionally, the ability to claim the subtraction may be affected if someone can declare you - or your spouse if filing jointly - as a dependent on their tax return.
It is important to accurately determine your adjusted gross income (adjusted grow income as noted in the provided reference), which is defined after certain adjustments are made to your total income.