December, 17th 2025
Each state has unique income tax withholding rules. Below are Oregon's 2026 withholding instructions, including allowance calculations, standard deduction adjustments, and the percentage method for determining tax due.
Employers must also adhere to federal income tax withholding rules. More information can be found here about federal rates .
Alternatively, employers can automatically calculate payroll withholding by using ezPaycheck.
| State Abbreviation | OR |
|---|---|
| State Tax Withholding State Code | 41 |
| Acceptable Exemption Form | W-4 |
| Basis For Withholding | State or Federal Exemptions |
| Acceptable Exemption Data | S, M, H / Number of Exemptions |
| TSP Deferred | Yes |
| Special Coding | None |
| Additional Information | If a state income tax certificate has not been processed or if a valid state exemption code is not present, the Federal exemption code will be used in the computation of state tax or if an invalid marital status (other than S, M, or H) is present with the number of state exemptions, the highest Oregon withholding rate (Single) with the number of exemptions will be used in the computation of state tax. On July 1, 2018, Oregon employers must start withholding the transit tax (one-tenth of 1 percent or .001) from wages of Oregon residents and nonresidents who perform services in Oregon. |
| Official State Tax Website | Visit Official Website |
Oregon's OR-W-4 (post-2020) uses a formula approach. Oregon no longer has a personal exemption credit, so the form focuses on standard vs itemized deductions and credits for dependents. Employees do not claim a simple count for themselves or spouse. Instead, there is a worksheet: it gives a standard allowance based on filing status and asks for number of dependents which is used to adjust withholding (Oregon's dependent credit is $219 each for 2025, so dependents factor in). There are no explicit 'allowance counts' for age or blindness; however, a Senior taxpayer may qualify for a slightly higher standard deduction which is built into the worksheet.
| Component | Allowances | Notes |
|---|---|---|
| Filing Status | Standard allowance | Based on filing status (built into worksheet) |
| Dependents | Number of dependents | Used to adjust withholding (dependent credit is $219 each) |
Withholding = Based on OR-W-4 worksheet calculation (filing status + dependents)
Oregon employees fill out marital status and dependents on Form OR-W-4; the form's worksheet computes a withholding amount rather than a count of allowances. No explicit allowance counts for age or blindness.
For links to official state tax and revenue websites for all 50 states, visit our State and Local Tax Sites page.
Subtract the nontaxable biweekly Thrift Savings Plan contribution from the gross biweekly wages.
Subtract the nontaxable biweekly Federal Health Benefits Plan payment(s) (includes dental and vision insurance program, and flexible spending account - health care and dependent care deductions) from the amount computed in step 1.
Add the taxable biweekly fringe benefits (taxable life insurance, etc.) to the amount computed in step 2 to obtain the adjusted gross biweekly wages.
Multiply the adjusted gross biweekly wages times 26 to obtain the gross annual wages.
Subtract the employees annualized Federal withholding tax from annualized gross pay to determine annualized taxable wages. The annualized Federal withholding tax to be deducted cannot exceed the maximum amount shown in the table based on marital status and the annualized gross pay calculated in Step 4.
Determine the standard deduction allowance by applying the following guideline and subtract this amount from the annual wages: Single claiming less than 3 exemptions: $2,835. Single claiming 3 or more exemptions: $5,670. Married: $5,670.
If the employees annualized gross wages calculated in Step 4 are less than $50,000, calculate the annual tax amount on the adjusted taxable wages using the appropriate tax withholding table (Married or Single with Three or More Exemptions, or Single with Less Than Three Exemptions).
If the employees annualized gross wages calculated in Step 4 are $50,000 or more, calculate the annual tax amount on the adjusted taxable wages using the appropriate tax withholding table (Married or Single with Three or More Exemptions, or Single with Less Than Three Exemptions).
Multiply the number of exemptions by $256 and subtract from the annual tax calculated above to obtain the annual Oregon tax withholding.
Annual Oregon Tax = Annual Tax (from table) - ($256 × Number of Exemptions)
Divide the annual Oregon tax withholding by 26 to obtain the biweekly Oregon tax withholding.
Want to calculate in an easier way? Learn how to calculate Oregon taxes via ezPaycheck below.
Learn MoreThe annualized Federal withholding tax to be deducted cannot exceed the maximum amount shown in the following table based on marital status and the annualized gross pay.
| If the Amount of Taxable Income Is: | The Maximum Federal Deduction Amount Is: | |
|---|---|---|
| Over | But Not Over | Maximum Deduction |
| $50,000 | $125,000 | $8,500 |
| $125,000 | $130,000 | $6,800 |
| $130,000 | $135,000 | $5,100 |
| $135,000 | $140,000 | $3,400 |
| $140,000 | $145,000 | $1,700 |
| $145,000 | and over | $0 |
| If the Amount of Taxable Income Is: | The Maximum Federal Deduction Amount Is: | |
|---|---|---|
| Over | But Not Over | Maximum Deduction |
| $50,000 | $250,000 | $8,500 |
| $250,000 | $260,000 | $6,800 |
| $260,000 | $270,000 | $5,100 |
| $270,000 | $280,000 | $3,400 |
| $280,000 | $290,000 | $1,700 |
| $290,000 | and over | $0 |
| Annualized Wages | Deduction |
|---|---|
| Over $0 | Single claiming less than 3 exemptions |
| Over $0 | Single claiming 3 or more exemptions |
Standard deduction: $2,835 for Single with less than 3 exemptions; $5,670 for Single with 3 or more exemptions.
| Annualized Wages | Deduction |
|---|---|
| Over $0 | $5,670 |
Standard deduction: $5,670 for Married.
| If Taxable Income Is | Tax Withholding | ||||
|---|---|---|---|---|---|
| Over | But Not Over | Base | + | Rate | Of Excess Over |
| $0 | $8,800 | $256 | + | 4.75% | $0 |
| $8,800 | $22,200 | $674 | + | 6.75% | $8,800 |
| $22,200 | and over | $1,579 | + | 8.75% | $22,200 |
| If Taxable Income Is | Tax Withholding | ||||
|---|---|---|---|---|---|
| Over | But Not Over | Base | + | Rate | Of Excess Over |
| $0 | $4,400 | $256 | + | 4.75% | $0 |
| $4,400 | $11,100 | $465 | + | 6.75% | $4,400 |
| $11,100 | and over | $917 | + | 8.75% | $11,100 |
| If Taxable Income Is | Tax Withholding | ||||
|---|---|---|---|---|---|
| Over | But Not Over | Base | + | Rate | Of Excess Over |
| $0 | $33,830 | $0 | + | 0.00% | $0 |
| $33,830 | $250,000 | $1,323 | + | 8.75% | $33,830 |
| $250,000 | and over | $21,256 | + | 9.90% | $250,000 |
| If Taxable Income Is | Tax Withholding | ||||
|---|---|---|---|---|---|
| Over | But Not Over | Base | + | Rate | Of Excess Over |
| $0 | $38,665 | $0 | + | 0.00% | $0 |
| $38,665 | $125,000 | $661 | + | 8.75% | $38,665 |
| $125,000 | and over | $10,627 | + | 9.90% | $125,000 |
ezPaycheck simplifies payroll calculations, including Oregon's withholding rules. Easily compute taxes, generate reports, and print paychecks or tax forms.
We strive to provide accurate and up-to-date Oregon state tax information for 2026. If you notice any discrepancies, errors, or have questions about the tax rates or calculations shown on this page, please contact our support team. We appreciate your feedback and will review and update the information as needed.
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