Oregon Wage and Payroll Tax Facts

February 02, 2024

Having to comply with unique state taxes and wage laws can make processing payroll doubly daunting. Here’s everything you need to know about these rates and laws for the state of Oregon.

Oregon requires minimum wage rates that are substantially higher than the rates required by the federal government in the Fair Labor Standards Act (FLSA). In fact, the rate required in the Portland metro area is over double the FLSA rate.

The state also has multiple programs for protected sick leave and family leave, though not all of these programs provide wage reimbursement. 
When it comes to processing payroll, Oregon-based organizations must handle the following taxes in addition to those required by the federal government:

  • Personal Income (a.k.a. State Income Tax)
  • State Unemployment Insurance (SUI)
  • Paid Family and Medical Leave (PFML)
  • State and Local Transit Services
  • Workers' Benefit Fund Assessments

The below information was last updated January 31, 2024. It is not intended as legal or tax advice.

Oregon Minimum Wage Rates

Wage Type

Oregon Rates

Federal Rates

Minimum Wage

$13.20 (non-urban counties)
$14.20 (standard)


Tipped Minimum Wage



Actual Tip Credit



Local Minimum Wage Rates

In addition to the state-wide minimum wage rates above, the city of Portland also has a minimum wage rate of $15.45.

Oregon State Income Tax (SIT) Rates

Oregon's SIT is progressive, meaning it adjusts based on the income level of the employee paying the tax: 

Filing Status Income Tax Bracket*
[Over X] - [But not over Y]
2024 Income Tax Rate
Single / Married (filed separately) $50,000 - $125,000 $4,090 + 8.75% of excess over $50,000
$125,000 or greater $10,652 + 9.90% of excess over $125,000
Head of Household / Married (filed jointly) $50,000 - $250,000 $3,805 + 8.75% of excess over $50,000
$250,000 or greater $21,305 + 9.90% of excess over $250,000

*If your annual income is less than $50,000, use the state's Tax Tables for Form OR-40 to find your tax rate. 

Additional Oregon SIT Details

Supplemental Withholding Computation


Valid Filing Statuses

  • S = Single or married filing separately
  • M = Married filing jointly
  • S3 = Claiming 3 or more allowances


Number of allowances

Form W-4

Form OR-W-4

Reconciliation Frequency


Oregon State Unemployment Insurance (SUI) Rates

SUI provides unemployment benefits to eligible workers who are unemployed through no fault of their own (as determined by state law) and meet the state’s eligibility requirements.

Oregon SUI Tax Details

Taxable Wage Base


Employee Subject to Tax


Rates for Experienced Employers

0.9% - 5.4%

Rates for New Employers


Effective Period

Calendar Year

Voluntary Contributions Allowed


Special Payroll Tax Offset Rate


Oregon State Disability Insurance (SDI) Rates

SDI benefits are funded by employees through mandatory payroll deductions from each paycheck. Oregon, however, doesn't require employers to collect an SDI tax.

Miscellaneous Oregon Tax Information

Reciprocal Agreement(s)

Reciprocal agreements are when workers who live and work in different states are only required to pay taxes to the state where they live. Oregon currently has no reciprocal agreements with any other states.

This doesn't mean, however, that interstate workers living in Oregon pay double. It’s federally illegal for two states to tax the same income. In most cases, the employee’s work state will credit or refund them at tax time based on the taxes they owe their home state. If the tax rates differ, the employee must cover the difference.

Quarterly Combined Tax Report

Oregon uses a combined tax report (Form OQ) for employers to calculate and pay the following taxes each quarter:

  • SIT and SUI
  • Transit taxes
  • Paid Family and Medical Leave taxes
  • Workers' Benefit Fund

Employers often submit Form Oregon Schedule B and Form 132 (Employee Detail Report) with a Form OQ submission. Refer to the state's Combined Payroll Tax Report Instructions for more information on all three forms.

  • Oregon Schedule B Form - Used if SIT deposits must be submitted semi-weekly or on a one-baking day basis.
  • Form 132 - Reports the total gross wages of each Oregon employee. 

Paid Sick Leave (PSL) Taxes

The state of Oregon doesn't require employers to collect PSL taxes, but it does have a program providing such leave to eligible employees:

Oregon PSL Details
Covered Employees All who work and reside in the state
Covered Employers Those with 10 or more employees
Accrual Method(s) 1 hour for every 30 hours worked
Annual Accrual Maximum 40 hours
Carryover Maximum 40 hours
Total Accrual Maximum 80 hours
Frontloading Allowed Yes
FAQs Paid Sick Leave

Paid Family and Medical Leave (PFML) Taxes

Like SDI, Oregon's Paid Leave (PL) program is funded via mandatory payroll deductions. 

Oregon PL Details
Covered Employees Those who work in Oregon and earned at least $1,000 the year before they apply for leave
Covered Employers All
Tax Rate 1% of an employee's gross wages*
Wage Base Limit $132,900
Maximum Leave Available 12 weeks (or 14 if the leave is pregnancy-related)
Wage Replacement Varies based on employee's average weekly wage from the prior year (can go up to 120% of the state's average weekly wage)
FAQs Paid Leave Oregon FAQs

*Large employers with 25 or more employees provide 40% of this amount, while their employees cover the remaining 60%. Small employers with fewer employees don't have to share this tax with employees but may choose to if they wish. 

Oregon Family Leave Act (OFLA) Taxes

The state of Oregon doesn't require employers to collect OFLA taxes, but the Act does provide protected, unpaid leave to employees. 

Oregon FLA Details
Covered Employees Those who worked an average of 25 hours per week for 180 days
Covered Employers Those with 25 or more employees
Maximum Leave Available 12 weeks
Wage Replacement None

State and Local Transit Taxes

The state, and several local areas, also require transit taxes that vary based on where an employee works. While the 0.1% statewide transit tax is paid by resident and nonresident employees working in Oregon, the local versions are covered by employers as a percentage of the employee's gross wages:

Transit Tax Details


Lane 0.0079%
Sandy 0.6%
South Clackamas 0.5%
Tri-Met 0.008137%
Wilsonville 0.5%

Workers' Benefit Fund Taxes

The Worker's Benefit Fund helps provide return-to-work assistance, benefits to permanently and totally disabled workers, and benefits to family members of workers who die from workplace injuries or diseases.

Employers and employees split this payroll tax evenly, at a rate of $0.22 per hour the employee worked. Employers can choose to pay the collected amounts to the state annually or every quarter.

Oregon Employer Registration

The agencies below can help with your state-based employer registration, including best practices, account numbers, and unemployment information. Contact the Department of Revenue for withholding tax topics and the Employment Department for unemployment tax topics.

Registration Details

Department of Revenue

Employment Department


(503) 378-4988 (503) 947-1488

Online Registration

Revenue Online Homepage

Registration Form


Registration Instructions

Online and paper registration options are available. Account numbers will be issued during the online process or 2-4 weeks via mail.

Identical account numbers for each tax type will be issued under a combined registration.

Employer Self-Service Login

Revenue Online Homepage Frances Online Login Page

Additional Oregon Payroll Tax Resources


This information is provided as a courtesy and may be updated at any time. It is not intended as legal or tax guidance. If you have questions or concerns, we encourage you to seek the advice of a qualified CPA, tax attorney, or advisor.


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