PORTLAND, Ore — It’s tax season and this year’s going to be a little wonky. We know you have questions about filing, like this one from Gen: “Is Oregon taxing the stimulus payments?”
Long story short: Yes. You'll probably owe some extra money to the state or get a smaller refund than usual.
Oregon is one of only a few states that lets you deduct the federal income taxes you pay from the income you pay state taxes on.
Typically, that saves you money in state taxes. But here's where it gets confusing, the stimulus payments are technically advance payments of a federal income tax credit.
That means your federal tax liability goes down and so does the amount you can subtract from your taxable income when you file your Oregon taxes.
Here’s how it will affect your bank account:
To figure out how much extra you'll owe, multiply the amount you got in stimulus money by Oregon’s state tax rate 8.75 percent. The average single person who got $1,800 would owe an extra $157.50 to the state this year.
A family with two kids who got $3,400 in stimulus money would owe $298 in Oregon taxes.
Now, this won't apply to you if you make too little to pay federal taxes or too much to qualify for the state credit.