TAXES 21-21, Oregon State Income Tax Withholding

Published: April 23, 2021
Effective: Pay Period 08, 2021

Summary

The income tax withholding formula for the State of Oregon includes the following changes:

The standard deduction amount for Single filers claiming less than three allowances has changed from $2,315 to $2,350.
The standard deduction amount for Single filers claiming three or more allowances has changed from $4,630 to $4,700.
The standard deduction amount for Married filers has changed from $4,630 to $4,700.
The annual tax credit amount per exemption has changed from $210 to $213.
The annualized deduction for Federal tax withheld has changed from a maximum of $6,950 to $7,050.
The tax tables have changed for all filers.

No action on the part of the employee or the personnel office is necessary.

Tax Formula

State Abbreviation:	OR
State Tax Withholding State Code:	41
Acceptable Exemption Form:	OR-W-4 or W-4 (see the Additional Information section)
Basis for Withholding:	State or Federal Exemptions (see the Additional Information section)
Acceptable Exemption Data:	S/M, Number of Exemptions
TSP Deferred:	Yes
Special Coding:	None
Additional Information:	Employees who have not previously submitted an OR W-4, and have submitted a 2020 or newer Federal Form W-4 or have not previously submitted a prior to 2020 Federal Form W-4, will default to the flat withholding tax rate of eight percent. Employees who have not previously submitted an OR W-4 and have not submitted a 2020 or newer Federal Form W-4, will default to the prior to 2020 Federal Form W-4 submission.

Withholding Formula (Effective Pay Period 08, 2021)

Subtract the nontaxable biweekly Thrift Savings Plan contributions from the gross biweekly wages.
Subtract the nontaxable biweekly Federal Employees 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 (e.g., taxable life insurance) to the amount computed in step 2 to obtain the adjusted gross biweekly wages.
Multiply the adjusted gross biweekly wages by the number of pay dates in the tax year to obtain the gross annualized wages.

Subtract the employee's annualized Federal withholding tax from the annualized gross pay to determine annualized taxable wages. The annualized Federal withholding tax to be deducted cannot exceed the maximum amount shown in the following tables based on marital status and the annualized gross pay calculated in step 4:

Note: To calculate the annualized Federal withholding tax, multiply the biweekly Federal income tax withholding by the number of pay dates in the tax year and deduct from the result of step 4.

Single (Regardless of the Number of Exemptions) Tax Withholding Table

If the Amount of Taxable Income Is:	The Maximum Federal Deduction Amount Is:
Over $0 but not over $124,999.99	$7,050
Over $124,999.99 but not over $129,999.99	$5,650
Over $129,999.99 but not over $134,999.99	$4,200
Over $134,999.99 but not over $139,999.99	$2,280
Over $139,999.99 but not over $144,999.99	$1,400
Over $144,999.99	$0

Married (Regardless of the Number of Exemptions) Tax Withholding Table

If the Amount of Taxable Income Is:	The Maximum Federal Deduction Amount Is:
Over $0 but not over $249,999.99	$7,050
Over $249,999.99 but not over $259,999.99	$5,650
Over $259,999.99 but not over $269,999.99	$4,200
Over $269,999.99 but not over $279,999.99	$2,280
Over $279,999.99 but not over $289,999.99	$1,400
Over $289,999.99	$0

Determine the standard deduction allowance by applying the following guideline and subtract this amount from the annualized wages:

If the Employee Is:

The Standard Deduction Is:

Single claiming less than three (3) exemptions

$2,350

Single claiming three (3) or more exemptions

$4,700

Married

$4,700

If the Employee Is:	The Standard Deduction Is:
Single claiming less than three (3) exemptions	$2,350
Single claiming three (3) or more exemptions	$4,700
Married	$4,700

If the employee's annualized gross wages calculated in step 4 are less than $50,000, calculate the annual tax amount on the adjusted taxable wages using one of the tables below.

Single (With Less Than Three Exemptions) Tax Withholding Table

If the Amount of Taxable Income Is:	The Amount of Tax Withholding Should Be:
Over $0 but not over $3,650	$213.00 plus 4.75%
Over $3,650 but not over $9,200	$386.00 plus 6.75% of excess over $3,650
Over $9,200	$761.00 plus 8.75% of excess over $9,200

Single (With Three or More Exemptions) or Married Tax Withholding Table

If the Amount of Taxable Income Is:	The Amount of Tax Withholding Should Be:
Over $0 but not over $7,300	$213.00 plus 4.75%
Over $7,300 but not over $18,400	$560.00 plus 6.75% of excess over $7,300
Over $18,400	$1,309.00 plus 8.75% of excess over $18,400

If the employee's annualized gross wages calculated in step 4 are $50,000 or more, calculate the annual tax amount on the adjusted taxable wages using one of the tables below.

Single (With Less Than Three Exemptions) Tax Withholding Table

If the Amount of Taxable Income Is:	The Amount of Tax Withholding Should Be:
Over $0 but not over $9,200	$0.00
Over $9,200 but not over $125,000	$548.00 plus 8.75% of excess over $9,200
Over $125,000	$10,681.00 plus 9.90% of excess over $125,000

Single (With Three or More Exemptions) or Married Tax Withholding Table

If the Amount of Taxable Income Is:	The Amount of Tax Withholding Should Be:
Over $0 but not over $18,400	$0.00
Over $18,400 but not over $250,000	$1,096.00 plus 8.75% of excess over $18,400
Over $250,000	$21,361.00 plus 9.90% of excess over $250,000

Based on the employee's marital status and the annualized gross wages calculated in step 4, reduce the total number of exemptions claimed by the personal allowance shown in the following table (do not reduce exemptions below 0 (zero)):

Marital Status	Annualized Wages	Total Exemptions Claimed	Personal Allowance Reduction
Single	Greater than $100,000	1 or more	1
Married	Greater than $200,000	1	1
Married	Greater than $200,000	2 or more	2

Multiply the adjusted number of exemptions claimed by $213 and subtract this amount from the annual tax calculated above.
Divide the annual Oregon tax withholding calculated in step 10 by the number of pay dates in the tax year to obtain the biweekly Oregon tax withholding.

Resources

To view the updated tax formula, go to the HR and Payroll Clients page from the MyNFC drop-down menu on the National Finance Center (NFC) Home page. Select the Publications tab and select U.S. Income Tax Formulas from the Publications menu to launch the tax map. Select the desired State from the map provided for the formula.

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