2009 Oregon Legislature Increases Individual Income Tax Rates

By Jill D. Laney

HB 2649 becomes effective September 28, 2009, and will increase individual income tax rates for Oregonians.  Effective for tax years beginning on or after January 1, 2009, individual state tax rates will increase for an individual with annual taxable income above $125,000, and for a household with taxable income that exceeds $250,000.  For an individual filer with taxable income between $125,000 and $250,000, and for a household with taxable income between $250,000 and $500,000, the top rate is increased from 9 to 10.8 percent.  For an individual with taxable income that exceeds $250,000, and for a household with taxable income that exceeds $500,000, marginal rates increase to 11 percent. 

            HB 2649 also phases down the deduction allowed on Oregon tax returns for federal income taxes paid by a single filer with income between $125,000 and $145,000, and for joint filers with income between $250,000 and $290,000.  The deduction will be totally phased out for an individual with income that exceeds $145,000, and for joint filers with income that exceeds $290,000.