Working from Home: Impact on Tax Obligations

To request a filing extension, you must submit an extension payment by the original return due date for an automatic six-month filing extension. Extension payments may be made online or by mail using a payment voucher. The Revenue Division does not allow an extension of time to pay your tax. The Preschool for All program is funded by a personal income tax, which went into effect January 1, 2021. New Jersey has the highest state property taxes, at 2.21% of the property’s value.

For comparison purposes, however, your Oregon tax bracket is the tax bracket in which your last earned dollar in any given tax period falls. Effective January 1, 2023, the tax rate increased to 0.8037% of the wages paid by oregon income tax rate an employer and the net earnings from self-employment for services performed within the TriMet District boundary. Employers should apply the new rate with their reporting related to wages for the first quarter of 2023.

Metro Supportive Housing Services (SHS) Personal Income Tax

That means capital gains can be taxed at a rate as high as 9.9%, depending on your total income. 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%.

Payment due dates are the same as the dates for depositing federal and State of Oregon withholding tax liabilities. For more details, please see Oregon Metro’s SHS website and Multnomah County’s PFA website. https://www.bookstime.com/articles/outsourced-cfo Oregon has a progressive income tax that ranks among the highest in the nation. The average effective property tax rate is about average, though, ranking as the 26th-highest rate in the country.

TAXES 22-11, Oregon State Income Tax Withholding

A financial advisor can help you understand how taxes fit into your overall financial goals. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now. Paper returns for open accounts with a balance due greater than $100 are kept indefinitely. If an open account balance is less than $100, the paper return is destroyed after four years, but information reported on the return is retained indefinitely.

The business owner pays personal state income tax at ordinary rates based on which of Oregon’s four tax brackets they fall under. In this situation, the business is responsible for paying Oregon’s minimum excise tax of $150. S corporations operate like C corporations in that they set up separate entities that confer to business owners and their personal assets a host of legal and financial protections. The distinction between the two is the S status files with the Internal Revenue Service (IRS), which allows income derived from sales to pass through the corporation to its owners. Because the owners then pay personal income tax on this money, the federal government does not charge the business a corporate tax, considering this to be double taxation.

Requesting an Extension to File

Payments not received within five (5) business days after the due date will be considered late. A second late payment will cause the entire outstanding balance to become immediately due and any penalty waiver granted under the Revenue Division’s penalty assessment policy would be immediately reinstated to the outstanding balance. If an employer cannot file electronically, they may request permission to use an alternate filing method by contacting the Revenue Division. PORTLAND Ore. (KPTV) – While many Oregonians love to complain about the amount of taxes they are paying, are the taxes in Oregon actually some of the highest? The Oregon standard deductions increased from Tax Year 2021 to 2022.

Of all these sources, half of total state revenue is from taxation. Personal income tax and corporate excise tax are the most significant components of the state General Fund, and property tax is the most significant local tax in Oregon. These three taxes represent about 80% of all state and local taxes. Marginal tax rates start at 4.75 percent and, as a taxpayer’s income goes up, rates quickly rise to 6.75 percent and 8.75 percent, topping out at 9.9 percent. The thing to note is that it doesn’t take much income to get to the next-to-highest tax bracket of 8.75 percent. For couples filing taxes together, the 8.75 percent tax rate kicks in at $18,400 of taxable income (what you’re left with after all tax subtractions and deductions, but before tax credits).

Payroll and Self-Employment Tax Information

In 2020, voters in greater Portland approved a measure to raise money for supportive housing services for people experiencing homelessness or at risk of experiencing homelessness. W-2s are submitted separately from the Annual Withholding Reconciliation returns and must be submitted electronically through Portland Revenue Online (PRO) in EFW2 format. Employees may use the Metro OPT Form to elect in or out of withholding or to designate a different withholding amount, based on their tax situation. Prepare and e-File your Oregon Income Taxes here on eFile.com together with your Federal Income Tax Return.

• This minimum tax ranges from $150 for sales under $500,000 to $100,000 for sales in excess of $100 million.
• At least in this case, with both states imposing individual income taxes, the tax impact might be offsetting.
• If you want to cut taxes in Oregon, a simple majority of the Oregon legislature suffices.
• When you consider not just income taxes, but all the taxes collected by state and local governments, the tax structure turns upside-down.
• Oregon assesses income taxes up to 9.9%, and doesn’t have a general sales tax rate.
• If you do not meet the criteria listed above, you are not required to file a Multnomah County PFA Personal Income Tax return.

Starting in January of 2022, Metro employers are required to withhold the tax through payroll deductions for employees who earn more than $200,000 annually or for employees who opt into having the tax withheld. Your W-2 will indicate that this tax has been withheld in the local tax section under the name “METRO”. So, if you work in another municipality where income taxes are 2.25 percent or higher, you will pay no income taxes to the City of Oregon. However, you still must file a local income tax form, even if you pay taxes to another municipality. As mentioned above, with marginal tax rates, you only incur higher rates on income past a certain threshold. That’s why effective tax rates are a better measure of a taxpayer’s overall bill, according to the Tax Foundation.

Compare Tobacco Tax Data in Your State

Or, click the blue Download/Share button to either download or share the PDF via DocuX. Kiplinger is part of Future plc, an international media group and leading digital publisher. Rocky Mengle was a Senior Tax Editor for Kiplinger from October 2018 to January 2023 with more than 20 years of experience covering federal and state tax developments. Before coming to Kiplinger, Rocky worked for Wolters Kluwer Tax & Accounting, and Kleinrock Publishing, where he provided breaking news and guidance for CPAs, tax attorneys, and other tax professionals. He has also been quoted as an expert by USA Today, Forbes, U.S. News & World Report, Reuters, Accounting Today, and other media outlets.

• Telebright Corporation, Inc. (“Telebright”), which was incorporated in Delaware and maintained its offices in Maryland, employed a woman who lived in and telecommuted from New Jersey.
• The state personal income tax rates range from 4.75% to 9.9% of taxable income.
• ETax.com works with the IRS and state revenue services to bring you the latest tax laws, forms & schedules.
• If an employer cannot file electronically, they may request permission to use an alternate filing method by contacting the Revenue Division.
• Generally, you’re allowed to take a deduction for real estate taxes paid up to $10,000 ($5,000 if married filing separately.
• Employer guidance for 2023 withholding and reporting for the Multnomah County Preschool For All Personal Income Tax.

Oregon assesses income taxes up to 9.9%, and doesn’t have a general sales tax rate. On top of the federal taxes, you’ll also pay Oregon’s graduated corporate income tax, excise, or activity tax. To file your taxes with the IRS as a C-corp, you’ll need to submit Form 1120. Now, with many employees working at home, their state of residence may differ from their state of employment, which creates potential exposure for employers.