The four rates
The 2026 Oregon brackets
| Rate | Single base wage | Married base wage |
|---|---|---|
| 4.75% | First $4,550 | First $9,100 |
| 6.75% | $4,550\u2013$11,400 | $9,100\u2013$22,800 |
| 8.75% | $11,400\u2013$125,000 | $22,800\u2013$250,000 |
| 9.9% | Above $125,000 | Above $250,000 |
These are marginal brackets: only the income inside each band is taxed at that rate. A single filer with a $100,000 base pays 4.75% on the first $4,550, 6.75% to $11,400, and 8.75% on the rest \u2014 never 9.9%, because the base stays under $125,000.
Base wage, not gross
How Oregon actually taxes your pay
Oregon\u2019s formula never multiplies your salary by a bracket. It builds a base wage:
- Start with annual wages.
- Subtract the federal income tax withheld, capped at the subtraction limit ($8,750, phased out above $125,000 single / $250,000 married).
- Subtract Oregon\u2019s standard deduction ($2,910 single / $5,820 married).
Then the four brackets above apply to the base, and finally a $263-per-allowance credit is subtracted. For a $75,000 single filer the base is about $64,420 \u2014 over $10,000 below gross \u2014 which is why Oregon\u2019s effective rate is so much lower than the brackets imply.
The fixed deductions
Standard deductions and allowances
- Standard deduction: $2,910 single (with fewer than three allowances) or $5,820 married / single-with-three-or-more.
- Allowance credit: $263 per allowance on Form OR-W-4, subtracted after the brackets \u2014 worth the same to every filer.
- Allowance cutoff: allowances are forced to zero above $100,000 single / $200,000 married.
Each allowance you claim is worth exactly $263 in lower state tax for 2026 \u2014 a flat credit, not a percentage. Claiming three or more as a single filer also switches you to the larger married standard deduction.
The Oregon quirk
The federal tax subtraction
Oregon lets you subtract the federal income tax withheld from your wages \u2014 up to $8,750 in 2026 \u2014 before computing state tax. It phases out in $1,750 steps between $125,000 and $145,000 single ($250,000\u2013$290,000 married), and vanishes entirely above that. It\u2019s the single biggest reason Oregon\u2019s effective rate beats its bracket reputation, and it\u2019s the deduction most national calculators ignore. See the full federal tax subtraction guide for the phase-out table.
The real picture
Effective rates by income
Single filer, one allowance, no pre-tax deductions, outside Portland\u2019s local districts, 2026:
| Gross | Oregon tax | Effective state rate | Take-home |
|---|---|---|---|
| $50,000 | $3,204 | 6.4% | $38,801 |
| $100,000 | $7,147 | 7.1% | $71,333 |
| $150,000 | $12,805 | 8.5% | $99,936 |
| $200,000 | $17,755 | 8.9% | $129,865 |
| $300,000 | $27,655 | 9.2% | $186,115 |
The effective state rate climbs gently from 6.4% to 9.2% across a six-fold income jump \u2014 the subtraction keeps it flat at the bottom, and the 9.9% bracket plus subtraction phase-out push it up at the top. Even at $300,000, the effective state rate is below the 9.9% top bracket.
Joint vs. single
Married and head-of-household
Married filers get the doubled standard deduction ($5,820), married brackets with breaks at $9,100/$22,800/$250,000, the $263-per-allowance credit, and the phase-out delayed to $250,000\u2013$290,000. Oregon has no separate head-of-household rate schedule in the withholding formula \u2014 head-of-household filers are generally treated with the single brackets and standard deduction, though the credit and cutoff rules still apply. At $200,000, a married couple pays about $15,324 of Oregon tax versus $17,755 single \u2014 the brackets and subtraction both reward joint filing.
The refund
The Oregon kicker
If Oregon\u2019s tax collections exceed the forecast by at least 2%, the state refunds the excess to personal-income taxpayers \u2014 the Oregon kicker. It\u2019s refunded as a cash check or applied as a credit toward next year\u2019s tax, proportional to your liability. Because the kicker is based on your Oregon tax, it\u2019s a genuine, recurring reduction in what Oregon effectively costs most years. The 2026 outcome depends on revenue through year-end. Details in the kicker guide.