Report Details Soaring Business Tax Burden in Oregon, Portland

They were the 14th lowest for commercial customers, a drop of seven places, and 17th lowest for industrial customers, a drop of nine places. This trend suggests that Oregon is rapidly losing this important competitive advantage. This trend, combined with Oregon’s stagnating population and rising tax burden, is a worrisome indicator of the state’s relative desirability. The median house price-to-income ratio in Portland was 11th among the nation’s biggest metropolitan areas in 2022, up from 12th in 2021.

Oregon State Income Tax Tables in 2021

They illustrate the importance of the state’s semiconductor industry, naturally. But they also show that Oregon exports a wide variety of products, including chemicals, agricultural products, food products and wood products. To improve housing affordability, lawmakers should focus on policies that lower the cost of living and doing business in Oregon as well as those that encourage home construction.

Federal Income Tax Tables in 2022

But Oregon is a fairly small state, and that workforce accounts for about 7% of all state employment, the nation’s ninth highest ratio. At $28.80 per hour, according to the Competitiveness Book, the average manufacturing wage in Oregon is the nation’s 11th highest. Oregon also is among the top half of states in the productivity of manufacturing employees, the number of manufacturing workers and the per-capita value of employer investment in machinery and equipment. The cost of electricity is particularly important given the state’s push to minimize the use of petroleum products, including natural gas.

Oregon Income Tax Forms

Homes in Oregon are so expensive because they’ve increased in value steadily over a long period. Over the past 25 years, homes in Oregon have increased, on average, at the nation’s 14th-highest rate. Over the past five years, home prices have appreciated at the nation’s 40th highest rate.

In 2023, the office took the unusual step of developing a scenario that assumes Oregon’s population will decline slightly during the coming decade. To improve Oregon’s competitiveness, policymakers should avoid increasing the state’s tax burden on businesses and individuals. The clearest high-level indication of Oregon’s eroding tax climate is the state’s drop in various national rankings. Even more worrisome is the fact that Oregon’s tax burden on both businesses and individuals has grown rapidly in recent years, triggering a corresponding decline in the state’s economic competitiveness. Oregon’s tax burden and its recent growth incentivize businesses and individuals to leave for more affordable states while discouraging investment in and relocation to Oregon.

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The disconnect between educational funding and performance is a competitive double-whammy for the state. Raising taxes on businesses substantially has eroded Oregon’s competitiveness. A continued failure to parlay this additional revenue into educational quality will erode its competitiveness further, and businesses will respond by avoiding or leaving oregon state income tax Oregon. While the state’s per-capita personal income hovers in the middle range, Oregon is a high-cost state. Housing is among the nation’s most expensive, and the state’s tax burden is relatively high. In fact, the state and local tax burden per $1,000 of personal income was the nation’s 12th highest in 2021, up from 21st highest the previous year.

Qualified business income reduced tax rate (QBIRTR)

This tool is freely available and is designed to help you accurately estimate your 2022 tax return. Oregon doesn’t have a specific amended return form for corporations. Use the same form type originally filed for the tax year you’re amending and check the “amended” box. File your amended return separately from your current year’s return.

• The two most popular tax software packages are H&R Block At Home, sold by the H&R Block tax preparation company, and TurboTax Federal & State, sold by the Intuit software company.
• Close to 68% of all C corporations paid the minimum tax for tax year 2019, but minimum taxpayers accounted for less than 7% of the total tax paid by C corporations in 2019.
• ” while rehashing his experiences repeatedly getting denied insurance on a new home, along with tales of other homeowners being hit with premium hikes of 60% or 80%.
• Form OR-40-P filers will need to multiply the tax by their Oregon percentage on their return.
• A franchise tax is a tax on the privilege of doing business in a state.

Step 4: Prepare to file and pay your Oregon business taxes

In addition, the median income in the state is $117,847, which is the sixth-highest. The median yearly income in the U.S. is around $74,600, according to the latest data from the Federal Reserve. However, there is a great deal of income disparity, with some people making vastly more than that while others are unfortunately stuck in poverty. The following tax tables are supported by iCalculator™ US as part of the suite of free tax tools available in the US Tax HUB we provide for Oregon.

OBI’s 2024 Oregon Competitiveness Book provides key indicators of the Beaver State’s economic climate. ZenBusiness has helped people start, run, and grow over 500,000 dream companies. Thoughtful use tax compliance and recordkeeping practices are vital for Oregon small businesses. https://www.bookstime.com/articles/enrolled-agent-salary Work closely with an accountant to ensure you meet all guidelines and avoid interest and penalties from the Department of Revenue. Oregon also has a gross receipts tax called the Corporate Activity Tax (CAT) which is $250 + 0.57% of Oregon gross receipts over $1 million.

• As an employer, you also pay half of the Social Security and Medicare payroll taxes for employees.
• Oregon’s job growth has been much stronger over a 10-year horizon.
• As of 2021, the percentage of the state’s workforce with science, engineering and health doctorates was among the nation’s highest.
• A continued failure to parlay this additional revenue into educational quality will erode its competitiveness further, and businesses will respond by avoiding or leaving Oregon.
• Business investment will decrease further, and as this happens prosperity will decline.
• Oregon employers use the Combined Payroll Tax Reporting System to report and pay their payroll taxes.