Form OR-40: Oregon Income Tax for Full-Year Residents

Oregon Form OR-40 is the individual income tax return that full-year Oregon residents file each year to report income, apply Oregon’s additions and subtractions, and settle tax at rates between 4.75% and 9.9%. For tax year 2025, the return is due April 15, 2026. Because the OR-40 starts from your federal adjusted gross income, you need to finish federal Form 1040 before you fill it out.¹

Who Files the OR-40

The OR-40 is for people who lived in Oregon from January 1 through December 31. If you moved into or out of the state during the year, you file Form OR-40-P instead. If you never lived in Oregon but earned income from an Oregon source, the right form is OR-40-N.²

Whether you’re required to file depends on your gross income and filing status. For 2025:

Single, no dependents: file if gross income exceeds $7,935
Married filing jointly: $15,865
Head of household: $9,950
Claimed as someone else’s dependent: $1,350

These thresholds rise slightly with each personal exemption you claim.³ File anyway if you had Oregon tax withheld from your pay, since a return is the only way to get a refund of that withholding.

Deadline, Extensions, and What Happens If You’re Late

Your 2025 return and any tax owed are due by midnight on April 15, 2026.⁴ You can extend the filing deadline to October 15, 2026. Oregon automatically honors a federal extension, so if you’ve filed federal Form 4868 you don’t need a separate state request. Mark the “Extension filed” box on the OR-40 when you submit. For an Oregon-only extension, use Revenue Online or mail Form OR-40-V with any estimated payment.⁵

An extension buys time to file, not time to pay. If you owe tax and miss April 15, penalties and interest start running:

Late payment: 5% of unpaid tax, assessed right after the due date
Late filing beyond three months: an additional 20%, for a combined 25%
Interest: 8% per year starting January 1, 2026, with an extra 4% annual rate on any balance still unpaid more than 60 days after assessment

Interest applies only to the tax, not to the penalties.⁶

What to Have in Front of You

Finish your federal 1040 first. Oregon’s return starts with your federal AGI, then applies its own additions and subtractions.⁷ Pull together:

W-2s from every employer, showing wages and Oregon tax withheld
1099s for interest, dividends, contractor income, and retirement distributions
Your completed federal Form 1040
Last year’s Oregon return, which you’ll need to figure your kicker credit

The Department of Revenue cross-checks what you report against what employers and financial institutions file, so take the time to get the numbers right. Forms and the instruction booklet are available on the department’s website and at many public libraries.

Oregon’s Standard Deduction and Exemption Credit

Oregon’s standard deduction is much smaller than the federal one. For 2025:

Single or married filing separately: $2,835
Married filing jointly or qualifying surviving spouse: $5,670
Head of household: $4,560

You can itemize Oregon deductions instead if your qualifying expenses exceed those amounts.³

Oregon also gives a personal exemption credit of $256 per qualifying exemption. The credit phases out entirely once federal AGI exceeds $200,000 for joint and head-of-household filers, or $100,000 for single and married-filing-separately filers.³

Additions and Subtractions That Change Your Oregon Taxable Income

After entering your federal AGI, the OR-40 walks you through items Oregon taxes that the federal government doesn’t (additions) and items Oregon exempts that the federal government taxes (subtractions). Two subtractions matter to a large share of filers.

Federal Tax Liability Subtraction

Oregon lets you subtract your federal tax liability for the year, up to a cap. For 2025, the cap is $8,500 ($4,250 if married filing separately). The amount you subtract is your actual federal tax liability, not what you had withheld or paid, and it’s limited to the cap regardless of what you owed the IRS.³

Social Security Benefits

Oregon doesn’t tax Social Security. Whatever portion was included in your federal AGI, you subtract in full on the Oregon return.³ That’s a meaningful difference for retirees whose benefits are taxable federally.

Contributions to an Oregon 529 college savings plan generate a tax credit worth up to $180, or $360 for joint filers, for 2025.⁸ The complete list of additions and subtractions is in the OR-40 instructions and Publication OR-17.

Tax Brackets

Once you’ve applied your deductions, additions, and subtractions, you have Oregon taxable income. Four graduated brackets apply for 2025:

4.75% on the lowest tier
6.75% on the next tier
8.75% on the middle-to-upper tier
9.9% on taxable income above $125,000 (single) or $250,000 (joint)

Only the income above each threshold is taxed at that bracket’s rate. If your taxable income is under $50,000, look your tax up directly in the tax tables rather than figuring it bracket by bracket.⁹

The Oregon Kicker Credit

When Oregon’s revenue collections exceed the forecast by at least 2% over a two-year budget cycle, the surplus goes back to taxpayers as a credit on the next return. Oregonians call it the kicker. For tax year 2025, it’s 9.863% of your 2024 Oregon tax liability.¹⁰

Multiply your 2024 Oregon tax liability (line 22 of your 2024 return, not your withholding or refund) by 0.09863. The result is a credit that reduces the tax owed on your 2025 OR-40 or increases your refund. No 2024 Oregon return means no kicker.

How to File

Electronic filing is faster and catches more errors than paper. Three options:

Commercial tax software, which handles federal and state together
Direct File Oregon, a free option run by the Department of Revenue with the IRS Direct File program; you file your federal return through IRS Direct File, then your Oregon return through Direct File Oregon. Check the IRS eligibility tool first, since not every income type is supported.⁷
Revenue Online, Oregon’s own portal for filing, paying, and managing your account

If you file on paper, the address depends on whether you owe:

Owe tax: Oregon Department of Revenue, PO Box 14555, Salem, OR 97309-0940
Refund or zero balance: Oregon Department of Revenue, PO Box 14700, Salem, OR 97309-0930
Payment sent separately with Form OR-40-V: PO Box 14950, Salem, OR 97309-0950

Make checks payable to the Oregon Department of Revenue, and write the tax year and the last four digits of your Social Security number on the check.¹¹¹²

When Your Refund Arrives

E-filers who choose direct deposit usually see their refund within about two weeks, with the first ones starting in mid-February.¹³ If a direct deposit fails because of a wrong account number or a closed account, the department mails a paper check to the address on your return, which usually lands about two weeks after the failed deposit. You can’t change direct deposit information after submitting the return, so double-check your routing and account numbers before you file.¹⁴

Paper returns move much more slowly. The department typically doesn’t begin processing paper filings until the end of March, with the first paper refunds going out in early April. Your return won’t appear in the “Where’s My Refund?” tool on Revenue Online until it enters processing.¹³

1
Oregon Department of Revenue. 2025 Form OR-40 Oregon Individual Income Tax Return for Full-year Residents
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Oregon Department of Revenue. Do I Need to File?
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Oregon Department of Revenue. 2025 Publication OR-17 Oregon Individual Income Tax Guide
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Oregon Department of Revenue. Final Countdown: Tax Filing Deadline Is Wednesday
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Oregon Department of Revenue. Apply for an Extension
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Oregon Department of Revenue. Penalties and Interest for Personal Income Tax
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Oregon Department of Revenue. 2025 Form OR-40 Instructions
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Oregon Department of Revenue. Tax Benefits for Families
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Oregon Department of Revenue. 2025 Tax Tables for Form OR-40
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Oregon Department of Revenue. Oregon Surplus (Kicker) – Individuals
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Oregon Department of Revenue. Mailing Addresses
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Oregon Department of Revenue. Form OR-40-V Oregon Individual Income Tax Payment Voucher
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Oregon Department of Revenue. Paper Return Processing Delays in 2026
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Oregon Department of Revenue. Where Is My Refund?