Oregon State Income Tax Rates and Brackets by Tax Year

oregon individual income tax rate

Accordingly, it’s critical to identify strategies that can reduce this tax. (ll) For taxpayers with federal AGI that exceeds $150,000, the taxpayer will pay the greater of state income tax or 3 percent of federal AGI. (l) Exemption credits phase out for single taxpayers by $6 for each $2,500 of federal AGI above $229,908 and for MFJ filers by $12 for each $2,500 of federal AGI above $459,821. (j) Connecticut and New York have “tax benefit recapture,” by which many high-income taxpayers pay their top tax rate on all income, not just on amounts above the benefit threshold. New Hampshire exclusively taxes dividend and interest income while Washington only taxes capital gains income.

The tax rate is 6.6% on Oregon taxable income of $1 million or less and 7.6% on Oregon taxable income above $1 million. There is a minimum excise tax of $150 for S corporations and one between $150 and $100,000 for C corporations, based on Oregon sales. In 2023, the Oregon state income tax rates range from 4.75 to 9.90%. In the United States, federal income taxes can range from 10% to 37% of a person’s taxable income, and state taxes run from 0% in nine states to north of 13%. In addition to federal income taxes, most states also impose their own income taxes, which can vary widely. Technically, you don’t have just one “tax bracket” – you pay all of the Oregon marginal tax rates from the lowest tax bracket to the tax bracket in which you earned your last dollar.

State Individual Income Tax Rates and Brackets for 2016

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Oregon collects state income taxes using a progressive 5-bracket system. (f) Arizona’s standard deduction can be adjusted upward by an amount equal to 25 percent of the amount the taxpayer would have claimed in charitable deductions if the taxpayer had claimed itemized deductions. (s) Connecticut’s personal exemption phases out by $1,000 for each $1,000, or fraction thereof, by which a single filer’s Connecticut AGI exceeds $30,000 and a MFJ filer’s Connecticut AGI exceeds $48,000. (f) Arizona’s standard deduction can be adjusted upward by an amount equal to 27 percent of the amount the taxpayer would have claimed in charitable deductions if the taxpayer had claimed itemized deductions. Brackets are adjusted annually for inflation, but 2023 inflation adjustments were not available as of publication. Whether or not you have to pay Oregon state income tax depends on your residency status and the source of your income.

Personal Income Tax

Pending revenue triggers, the tax would eventually have been reduced to 2.5 percent, regardless of income level. Via ballot measure (Proposition 307) in the November 2022 election. In the following tables we have compiled the most up-to-date data available on state individual income tax rates, brackets, standard deductions, and personal exemptions for both single and joint filers.

Your Oregon state income tax may increase due to various factors. If your income has increased, tax laws may have changed, or you have adjusted your deductions and credits, which might have led oregon income tax to a higher tax bill. If you need more clarification about the reasons behind a significant increase, seeking guidance from a tax professional or using trusted tax software can provide clarity.

Estimated taxes

Oregon generally taxes all income earned by residents, regardless of where it was earned. However, tax credits may be available for taxes paid to another state. The portion of your paycheck that goes to taxes in Oregon varies depending on your income level and deductions. You can use tax calculators or consult a tax professional to get a clearer estimate. Oregon’s tax system differs from many other states as it doesn’t have a general sales tax. This means that when you make purchases in Oregon, you won’t be charged a state-level sales tax on most goods and services.

  • 1828, enacted in 2021, reduces rates and the number of brackets for Tax Year 2022.
  • The corporate excise and income tax is the second largest source of state tax revenue for the General Fund.
  • If you resided in Oregon for part of the year, Oregon will tax all income you earned during that period in Oregon and any income from Oregon-based sources for the rest of the year.
  • Under the Tax Cuts and Jobs Act, the personal exemption is set at $0 until 2026 but not eliminated.
  • In the United States, federal income taxes can range from 10% to 37% of a person’s taxable income, and state taxes run from 0% in nine states to north of 13%.

When you prepare and eFile your Tax Return the eFile Tax App will apply the correct standard deductions for you or you can apply the itemized deduction method. In 1862, not long after joining the Union, Oregon enacted a tax on people of color. If you were Black, mixed-race, Hawaiian, or Chinese, you had to pay a tax not levied on white Oregonians. If you couldn’t afford it, you paid it off by performing road work. Property subject to taxation includes all privately owned real property (land, buildings, and fixed machinery and equipment) and personal property used in a business.