If you live or work in the Portland area, there are some important local taxes you should be aware of. Oregon has introduced several metro and county-level taxes that may affect your tax bill, depending on your income and location.
Metro Supportive Housing Tax
The Metro Supportive Housing Tax applies to anyone who lives in, works in, or earns income from the Portland metro area. Here’s what you need to know:
Who Pays?
This 1% tax applies to higher-income earners with taxable income exceeding:
- $200,000 for married couples filing jointly
- $125,000 for single filers
How It Works
The tax only applies to income above these thresholds. For example, if you’re a single filer earning $150,000 in the metro area, you would pay 1% on $25,000 ($150,000 – $125,000), which equals $250.
Coverage Area
The metro area extends beyond Portland city limits and may include parts of Wilsonville, Hillsboro, Happy Valley, and Gresham. Check online tools to determine if your address falls within the taxable area.
Multnomah County Preschool For All Tax
If you live in, work in, or earn income from Multnomah County specifically, there’s an additional tax to consider.
Standard Rate
A 1.5% tax applies to income above:
- $200,000 for married couples filing jointly
- $125,000 for single filers
Using the same example as above, a single filer earning $150,000 in Multnomah County would pay 1.5% on $25,000, which equals $375.
Higher Income Rate
An additional 1.5% tax applies to even higher earners with income exceeding:
- $400,000 for married couples filing jointly
- $250,000 for single filers
This means high-income earners in Multnomah County could face a combined rate of 3% on their highest income brackets.
Important Details
Effective Date: Both taxes became effective January 1, 2021, with wage withholdings beginning in January 2022.
Geographic Distinctions: The Metro Supportive Housing Tax covers the broader Portland metro area, while the Preschool For All Tax is specific to Multnomah County. Depending on where you live and work, you could be subject to one or both taxes.
Verification: Online tools are available to help you determine whether your address falls within the taxable areas for each of these taxes.
What This Means for You
If you’re a Portland-area resident or worker earning above the income thresholds, these taxes will add to your annual tax liability. For someone in Multnomah County earning above the thresholds, both taxes could apply, creating a combined impact on your take-home pay.
It’s important to plan accordingly and ensure your employer is withholding the correct amounts. If you have questions about how these taxes apply to your specific situation, consider consulting with a tax professional to ensure compliance and accurate planning.
These local taxes represent Oregon’s approach to funding supportive housing and early childhood education through progressive taxation. Understanding your obligations helps you avoid surprises at tax time and ensures you’re contributing appropriately to community programs.
