Navigating the complexities of state taxes can be daunting, but understanding Oregon's tax landscape is essential for residents and newcomers alike.
In this guide, we'll explore key components of The Beaver State's tax system, from income and sales taxes to property taxes and retirement benefits.
Oregon state tax: Overview
When it comes to shopping, Oregon is one of only five states in the country with no sales tax, which means you won’t see extra charges tacked on at the register.
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Oregon’s income tax rates are steeper than in many other states. And if you’re inheriting property or assets, there’s something else to keep in mind: Oregon has a state estate tax.
Some good news is that estates under $1 million aren’t taxed in the Beaver State, so smaller inheritances are off the hook.
[Data for this state tax guide was gathered from a number of sources including the Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.]
Oregon income tax
Oregon has a graduated state individual income tax ranging from 4.75% to 9.9%, according to the Tax Foundation.
Counties and special districts in Oregon can also impose local income taxes.
Oregon tax on retirement income: Railroad retirement and Social Security benefits are tax-exempt.
Oregon retirement taxes
Oregon’s income tax brackets are high compared to most other states, and the state taxes most types of retirement income.
Oregon also has an estate tax that applies to estates valued over $1 million.
- Social Security: Not taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
Oregon sales tax
Oregon does not have a state sales tax rate, though cities can enact their own local sales tax.
How much are property taxes in Oregon?
In Oregon, the average property tax rate as a percentage of assessed home value is 0.77% according to the Tax Foundation.
Oregon Property Tax Breaks for Retirees
Homeowners 62 and older may qualify for Oregon's property tax deferral program. If approved for the program, you will borrow money from the State of Oregon to pay your county property taxes.
The loan is paid back when you sell or otherwise transfer ownership of the home. However, the loan accrues interest.
Oregon gas tax
Gasoline: $0.30 per gallon.
Diesel: $0.30 per gallon.
Source: Sales Tax Handbook
Oregon taxes on alcohol and tobacco
Product | Tax Amount |
|---|---|
Cigarettes | $1.32 per pack |
Other Tobacco Products | 65% of wholesale price |
Source: Sales Tax Handbook
Product | Tax Amount |
|---|---|
Wine | $0.67 per gallon |
Beer | $0.08 per gallon |
Liquor | state-controlled |
Source: Sales Tax Handbook
Oregon estate and inheritance taxes
Oregon has an estate tax for estates valued at more than $1 million. Estate tax rates range from 10% to 16%.
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