The personal income tax rate is 1.5% on taxable income over $125,000 for individuals and $200,000 for joint filers, and an additional 1.5% on taxable income over $250,000 for individuals and $400,000 for joint filers. Oregon collects a state corporate income tax at a maximum marginal tax rate of 7.600%, spread across two tax brackets. There are a total of twenty states with higher marginal corporate income tax rates then Oregon. While not all small businesses are pass-through entities, and not all pass-throughs are small, the vast majority of small businesses are organized as S corporations, partnerships, LLCs, and sole proprietorships. Add the federal individual income tax and the combined top rate is nearly 58 percent.

• To see if your work location is located within Portland and/or Multnomah County, visit Portland Maps and enter the address of the work location.
• Your quarterly underpayment interest is calculated at the rate in effect for the tax year from the due date of each quarterly estimated payment to the original due date of the tax return to which the estimated payments apply.
• This allows the corporate tax burden to be spread more evenly among companies with various revenue levels.
• Business owners may need adjust their recordkeeping practices in order to keep track of all earnings in the Portland and Multnomah County area so that they can accurately pay these taxes.
• If the Revenue Division refers your account to a third-party collection agency, additional fees up to 25% of the total balance due may be added to your debt, and you must contact the collection agency about your debt.
• As you can see from the table, the 35% bracket begins at $250,525 of income.
• In 2020, voters who live inside the Metro Boundary passed a ballot measure that imposes a 1% income tax on filers with Metro taxable income over $125,000 ($250,000 for married persons who file a joint tax return).

City Cast Portland

There are a few other deductions that can impact the size of your paychecks. If you pay for any benefits from your employer, such as health or life insurance, any premiums you pay will come out of your paycheck. Contributions you make to a retirement plan, like a 401(k), or to a medical expense account, like a health savings account (HSA), will also come out of your paycheck. That’s money that your employer removes from your pay before taxes are applied. While putting money in these accounts shrinks your paycheck, it also lowers your taxable income (and, in the case of retirement accounts, simultaneously helps secure your financial future). All filers can get their tax using the personal income tax calculator instead of using the tax rate charts or tables in the return instructions.

How Income Taxes Are Calculated

Oregon collects a state income tax at a maximum marginal tax rate of %, spread across tax brackets. Like the Federal Income Tax, Oregon’s income tax allows couples filing jointly to pay a lower overall rate on their combined income with wider tax brackets for joint filers. Oregon was one of the first Western states to adopt a state income tax, enacting its current tax in 1930. It consists of four income tax brackets, with rates increasing from 4.75% to a top rate of 9.9%. Only a small subset of taxpayers actually pays that rate, however, as it applies only to single taxpayers making at least $125,000 a year ($250,000 for joint filers). The table below shows oregon state income tax the full tax brackets and rates for the state income tax in Oregon.

Business Tax Help

Meanwhile, joint filers in the same income bracket can receive up to $360 when contributing at least $1,440. While Oregon does not have a state standard net sales deduction, you can claim personal exemptions for yourself, your spouse, and dependents. Personal exemptions help reduce your taxable income, leading to a lower tax bill and more money in your pocket.

• If the Revenue Division refers your account to the City Attorney’s office, additional court or legal fees may be added to your debt.
• Individuals who are liable for the tax must file a separate Metro SHS personal tax return and pay the tax to the City of Portland Revenue Division to be in compliance with the tax law.
• Where the same income is taxed at the entity level by the Business Income Tax and again when passed through to an owner and investor and taxed under the Multnomah Preschool for All Tax or Portland Supportive Housing Services Tax.
• Metro understands the challenge of this transition and will not assess penalties if the withholding is not available in 2021.
• The tax is applied to wages, salaries, and other compensation within certain thresholds, which are adjusted periodically.
• It’s important to understand your state’s income tax and how it will impact your financial future, not least because that knowledge will empower you to take action to reduce your tax bill today.

Calculate Your Take-Home Pay

Remember that Oregon may have very different deduction laws from the Federal Income Tax, so you may have to write a whole new list of deductions for your Oregon income tax return. Although this is the case, keep in mind that there are deductions in place and you may be subject to additional deductions, lowering the amount you will be paying in taxes. Taxes are delicate, which is why it is important for you to use the Accounting For Architects right tools to calculate how much you owe the government in taxes. Use our Oregon State Tax Calculator to be given an accurate breakdown of your tax payments for the current tax year. The 2025 tax rates and thresholds for both the Oregon State Tax Tables and Federal Tax Tables are comprehensively integrated into the Oregon Tax Calculator for 2025.