Calculating your take-home pay in Oregon requires navigating a unique landscape of progressive income tax brackets, a special federal tax subtraction, and specific payroll assessments like the Statewide Transit Tax and the Workers' Benefit Fund (WBF). Our Oregon Paycheck Calculator handles all these variables for 2024 and 2025 to give you an accurate net pay estimate.
How to Use This Calculator
Follow these steps to get the most accurate result:
- Enter Gross Pay: Input your earnings per pay period.
- Select Pay Frequency: Choose how often you get paid (e.g., Bi-Weekly, Monthly).
- Choose Filing Status: Select Single, Married, or Head of Household. This determines your standard deduction and tax brackets.
- Enter Hours Worked: This is crucial for the Workers' Benefit Fund (WBF) assessment, which is calculated at a rate of 1 cent per hour.
- Review Federal Withholding: You can use our auto-calculation or enter the exact amount from your pay stub for precision.
Understanding Oregon Income Tax Brackets (2025)
Oregon uses a progressive tax system, meaning higher portions of your income are taxed at higher rates. For the 2025 tax year, the rates range from 4.75% to 9.90%.
2025 Oregon Tax Brackets (Single Filers)
The Federal Tax Subtraction
One of Oregon's unique tax features is the Federal Tax Subtraction. You can subtract a portion of your federal income tax liability from your Oregon taxable income. For 2025, this subtraction is capped at $8,500 for single filers and $8,500 for joint filers. This effectively lowers your state tax bill.
Hidden Payroll Taxes in Oregon
Beyond the standard state and federal income taxes, Oregon employees will notice two specific line items on their pay stubs that are unique to the state. These are not optional deductions but mandatory payroll assessments that fund specific state programs. Understanding these can help explain why your take-home pay might be slightly lower than expected compared to other states with similar income tax rates.
1. Statewide Transit Tax
Implemented on July 1, 2018, the Statewide Transit Tax was designed to fund public transportation improvements across Oregon. This tax is withheld from the wages of all employees who perform services within the state, regardless of whether they are Oregon residents.
The tax rate is a flat 0.1% (or one-tenth of one percent) of your gross wages. This means for every $1,000 you earn, $1.00 is withheld. There is no income cap on this tax, so it applies to your entire paycheck. Employers are responsible for withholding this tax and remitting it to the state, but unlike Social Security or Medicare, there is no employer matching portion.
2. Workers' Benefit Fund (WBF)
The Workers' Benefit Fund (WBF) assessment is a payroll assessment that funds return-to-work programs, provides increased benefits for permanently and totally disabled workers, and supports families of workers who die from workplace injuries.
Unlike most taxes which are percentage-based, the WBF is a "cents-per-hour" assessment. For 2025, the total assessment rate is 2.0 cents per hour worked. This cost is split equally between the employee and the employer. As an employee, you contribute 1.0 cent for every hour you work. For a standard full-time employee working 40 hours a week (approx. 173 hours a month), this deduction is very small—around $1.73 per month—but it is a mandatory contribution for almost all Oregon workers.
Standard Deductions for 2025
The standard deduction is a specific dollar amount that reduces the income you're taxed on. It varies based on your filing status. By claiming the standard deduction, you lower your taxable income, which in turn lowers your overall tax liability. For the 2025 tax year, Oregon has adjusted these amounts for inflation.
- Single: $2,835
- Married Filing Jointly: $5,670
- Head of Household: $4,560
Portland Metro Supportive Housing Services Tax
If you live in the Portland metro area, you might face an additional tax. The Metro Supportive Housing Services (SHS) tax funds services for people experiencing homelessness.
- Rate: 1% on taxable income above $125,000 (single) or $200,000 (joint).
- Who Pays: Residents of Metro (includes parts of Clackamas, Multnomah, and Washington counties) and non-residents who work within the Metro district.
- Withholding: Employers within the Metro district are required to withhold this tax for employees earning over $200,000. Employees can also request voluntary withholding.
Multnomah County Preschool for All Tax
Similar to the SHS tax, Multnomah County residents (and non-residents with Multnomah County income) are subject to the Preschool for All (PFA) tax.
- Rate: 1.5% on taxable income over $125,000 (single) or $200,000 (joint). An additional 1.5% applies to income over $250,000 (single) or $400,000 (joint).
- Combined Impact: High earners in Portland can face a marginal tax rate significantly higher than the base state rate when you stack State + SHS + PFA taxes.
Frequently Asked Questions (FAQ)
Strategies to Increase Your Take-Home Pay
While taxes are mandatory, there are ways to optimize your financial situation:
- Contribute to a 401(k): Contributions reduce your taxable income for both federal and Oregon state tax purposes.
- Utilize an HSA: Health Savings Account contributions are triple-tax-advantaged and lower your taxable income.
- Check Your Withholding: Use the Oregon Department of Revenue Forms to find Form OR-W-4 and adjust your state withholding.
- Federal Adjustment: You can also use the IRS Tax Withholding Estimator to ensure your federal taxes are accurate.
The Oregon Surplus Credit (Kicker)
Oregon has a unique constitutional law known as the "Kicker." If actual state revenues exceed the forecasted revenues by 2% or more, the entire surplus must be returned to taxpayers.
- How it works: It is claimed as a refundable credit on your state tax return.
- Frequency: It happens every two years (biennium) if the surplus condition is met.
- Impact: In record years, this can result in a significant refund, effectively lowering your tax burden over a two-year period, even though it doesn't change your monthly paycheck withholding.
Oregon Earned Income Credit
Oregon offers its own version of the federal Earned Income Tax Credit (EITC). For the 2025 tax year, the Oregon EIC is equal to 12% of the federal credit for most families, and 15% for families with children under age 3.
This is a refundable credit, which means even if you owe no state income tax, you can still receive the credit as a refund. To qualify, you must file a tax return and claim the federal EITC. The Oregon credit is then calculated automatically based on your federal credit amount.
Property Tax Relief Programs
While property taxes are not deducted from your paycheck, understanding Oregon's property tax relief programs helps you plan your overall finances. Oregon offers several programs to reduce property tax burdens, particularly for seniors and low-income households.
- Property Tax Deferral for Seniors: Homeowners 62 and older with household income under $56,800 may defer property taxes until the home is sold.
- Property Tax Deferral for Disabled Citizens: Similar program available for disabled residents regardless of age.
- Homestead Property Tax Exemption: Available for disabled veterans and their surviving spouses.
Oregon vs. Washington and California
Many workers in the Portland metro area commute to or from Washington state. Understanding the tax implications is crucial for financial planning.
- Washington: Has no state income tax but has a high sales tax (approximately 6.5% state plus local additions). Oregon residents working in Washington still pay Oregon income tax on their wages.
- California: Has the highest top marginal rate in the nation (13.3%). Oregon's top rate of 9.9% is still high but significantly lower for high earners.
- Reciprocity: Oregon does not have reciprocal tax agreements with neighboring states, so cross-border workers may need to file in both states and claim credits to avoid double taxation.
Disclaimer: This calculator is for educational purposes only and provides an estimate. Tax laws are subject to change. For professional advice, consult a qualified CPA or tax advisor.