OR
Oregon Small Business Tax Guide
Oregon's sales tax position, Corporate Activity Tax and corporate excise rules, quoted from DOR pages alongside IRS points. This overview isn't tax advice.
Disclaimer: This page is educational content only. Tax laws change, and your situation may differ. It is not legal, tax, or financial advice. Consult a qualified professional licensed in Oregon before making filing or planning decisions.
Tax landscape for small businesses
Quotes below are drawn from the Oregon Department of Revenue (DOR) for state rules and from the IRS for federal ones, each tagged with its page and a checked or updated date.
On sales tax, the DOR's personal income tax page (Oregon, checked October 31, 2026) says "Oregon doesn't have a general sales tax or a transaction tax."
The DOR's Corporate Activity Tax page (Oregon, checked October 31, 2026) says "The tax is computed as $250 plus 0.57 percent of taxable Oregon commercial activity of more than $1 million." It also says "In addition, Oregon's CAT allows a 35 percent subtraction for certain business expenses." The same page says the CAT applies to "tax years beginning on or after January 1, 2020".
Using that CAT formula, which applies to "tax years beginning on or after January 1, 2020" (Oregon, DOR, checked October 31, 2026), on made-up numbers: a business with $1,200,000.00 of taxable Oregon commercial activity owes $250.00 + 0.57% × ($1,200,000.00 − $1,000,000.00) = $250.00 + $1,140.00 = $1,390.00 of CAT. Use your own figures; these are only an illustration.
Tax overview
Each row lists a tax area and its notes. Confirm current figures with your state's tax agency or the IRS.
| Tax type | Rate or basis | Notes |
|---|---|---|
| General sales tax | "doesn't have a general sales tax" | DOR personal income tax page (Oregon, checked October 31, 2026): "Oregon doesn't have a general sales tax or a transaction tax." |
| Corporate Activity Tax (CAT) | "$250 plus 0.57 percent" | DOR CAT page (Oregon, checked October 31, 2026): "of taxable Oregon commercial activity of more than $1 million". The CAT applies to "tax years beginning on or after January 1, 2020". |
| Corporate excise tax, first $1 million | "6.6 percent" | DOR corporations page (Oregon, checked October 31, 2026): "If Oregon taxable income is $1 million or less, multiply Oregon taxable income by 6.6 percent (not below zero)." The page gives no tax year for this rate; it adds "For tax years beginning before January 1, 2013 see the specific year's form instructions." |
| Corporate excise tax, above $1 million | "7.6 percent" | DOR corporations page (Oregon, checked October 31, 2026): "If Oregon taxable income is more than $1 million, multiply the amount that is more than $1 million by 7.6 percent, and add $66,000." As with the first bracket, the page gives no tax year for this rate. |
| Federal self-employment tax | "15.3%" | IRS self-employment tax page (In the US (federal), last reviewed or updated October 30, 2026): "The self-employment tax rate is 15.3%." |
Filing requirements
This list isn't a complete checklist for your business.
CAT registration
The DOR's CAT page (Oregon, checked October 31, 2026) says "A business must register for the CAT within 30 days of realizing $750,000 in commercial activity for the year."
CAT return and estimated payments
The same page (Oregon, checked October 31, 2026) says "Annual returns are due on or before the 15th day of the fourth month following the end of your tax year." It adds "For tax years 2021 and after, a taxpayer expecting $5,000 or more of CAT liability must make estimated payments."
When the CAT reaches an out-of-state business
The DOR's CAT page (Oregon, checked October 31, 2026) says "Substantial nexus exists where a person regularly takes advantage of Oregon's economy to realize commercial activity for the person and may be established through the significant economic presence of the person in the state." It adds "The department will not apply a bright line nexus test for the CAT."
Entities and items the CAT leaves out
The same page (Oregon, checked October 31, 2026) says "The CAT legislation excludes certain types of business entities from any CAT liability, unless such business has unrelated business taxable income under federal law." Its examples include "Nonprofit organizations, including business entities that have been recognized by the IRS as tax-exempt organizations described in section 501(c)(3) of the Internal Revenue Code." and "Federal, state, and local government entities (e.g., public school districts)." It sends readers to ORS 317A.100(4) for the full list, and says "Certain items are excluded from the definition of commercial activity and, therefore, will not be subject to the CAT."
Corporate excise return
The DOR's corporations page (Oregon, checked October 31, 2026) gives this example: "For example, if a calendar year federal C corporation return is due April 15, the Oregon calendar year return is due May 15." It also says "You must make quarterly estimated tax payments if you expect to owe $500 or more in tax for the year."
Personal estimated payments
The DOR's personal income tax page (Oregon, checked October 31, 2026) says "In most cases, you must make estimated tax payments if you expect your tax after credits and withholding will be $1,000 or more, before you subtract any prior year refund you applied to your current year's tax."
Deductions and write-offs
Confirm with your state how it treats each item.
- CAT subtraction: the DOR's CAT page (Oregon, checked October 31, 2026) says taxpayers "can subtract 35 percent of the greater of cost inputs or labor costs from commercial activity sourced to Oregon". The subtraction is part of the CAT, which applies to "tax years beginning on or after January 1, 2020".
- Self-employment tax: the IRS self-employment tax page (In the US (federal), last reviewed or updated October 30, 2026) says "you can deduct the employer-equivalent portion of your SE tax when calculating your adjusted gross income".
- Oregon additions and subtractions on income tax returns: ask the DOR or a tax professional which ones apply to you.
Practical tips
- Track your Oregon commercial activity during the year. The DOR (Oregon, checked October 31, 2026) says "A business must register for the CAT within 30 days of realizing $750,000 in commercial activity for the year."
- Know the minimum tax. The DOR's corporations page (Oregon, checked October 31, 2026) says "C corporation excise tax filers, including insurance companies, pay the minimum tax or calculated tax, whichever is greater."
- Keep receipts with their expenses. Billed's expense tracking page (checked October 31, 2026) says "Attach the receipt when you record the expense, and it stays with that entry in your Billed account instead of in a drawer or an inbox."
- Confirm figures with the DOR or a tax professional before you file.
Frequently asked questions
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At a glance
| Topic | As the DOR or the IRS puts it |
|---|---|
| Sales tax | "Oregon doesn't have a general sales tax or a transaction tax." (Oregon, checked October 31, 2026) |
| CAT | "The tax is computed as $250 plus 0.57 percent of taxable Oregon commercial activity of more than $1 million." (Oregon, tax years starting in 2020 or later; checked October 31, 2026) |
| CAT registration | "A business must register for the CAT within 30 days of realizing $750,000 in commercial activity for the year." (Oregon, checked October 31, 2026) |
| Corporate excise, up to $1 million | "multiply Oregon taxable income by 6.6 percent (not below zero)" (Oregon, no tax year given; checked October 31, 2026) |
| Self-employment tax | "The self-employment tax rate is 15.3%." (In the US (federal), last reviewed or updated October 30, 2026) |
When this isn't for you
For sole proprietors, partnerships and corporations doing business in Oregon. Payroll withholding, the statewide transit tax, vehicle privilege and use taxes, and the PTE-E election aren't covered; take those to the DOR or a tax professional.