Oregon Form OQ is the combined quarterly tax report that Oregon employers use to report state withholding, Unemployment Insurance, Paid Leave Oregon, the Statewide Transit Tax, the Workers’ Benefit Fund, and TriMet or Lane Transit District taxes on a single filing. Most employers submit it through Frances Online at frances.oregon.gov, and every quarterly OQ must be accompanied by a Form 132 Employee Detail Report listing each employee’s wages.
Who Has to File
Under ORS 657.025, you become subject to Oregon’s unemployment insurance law once you employ one or more workers in each of 18 separate weeks during a calendar year, or once your payroll reaches $1,000 in any calendar quarter. That $1,000 threshold is easy to hit. A single part-time hire can push a small business into filing status within a couple of months, and once you cross either line the obligation to file Form OQ every quarter continues until you formally close the account with the state.
Two categories work differently. Agricultural employers become subject at $20,000 in cash wages in a calendar quarter, or when they employ ten or more workers on 20 different days in separate calendar weeks during the year. Domestic employers hiring household staff such as nannies or housekeepers enter the system at $1,000 in quarterly payroll.
If you have nonresident employees performing services in Oregon, you generally withhold Oregon income tax on those wages, and Oregon-source wages must appear on the employee’s W-2 even in quarters where no withholding is required. For an Oregon resident teleworking for an out-of-state employer with no Oregon presence, the state asks the employer to register and courtesy-withhold rather than strictly requiring it.
What Form OQ Actually Taxes
Form OQ covers six separate programs. Each has its own rate, its own wage base, and its own rule about who pays. Getting the rates right is where most filing errors happen, so the 2026 figures matter.
State Income Tax Withholding
You withhold Oregon income tax from each paycheck based on the employee’s allowances and the Department of Revenue’s annual withholding tables. When an employee’s Oregon allowances differ from their federal allowances, use the Oregon Withholding Tax Formulas in Publication 150-206-436 instead of the standard wage bracket tables.
Unemployment Insurance
The 2026 UI taxable wage base is $56,700 per employee, so UI tax applies only to the first $56,700 each worker earns for the year. Your rate depends on your experience rating. Under 2026 Tax Schedule 3, rates run from 0.9% to 5.4%. New employers with less than 12 months of reported payroll pay the base rate of 2.4%.
Paid Leave Oregon
The total Paid Leave Oregon contribution for 2026 is 1% of gross wages up to the Social Security wage base of $184,500. Employees pay 60% of that 1%, and large employers (averaging 25 or more employees) pay the remaining 40%. Small employers with fewer than 25 employees on average owe no employer share, but they still must withhold and remit the employee’s 60% every quarter.
Statewide Transit Tax
The Statewide Transit Tax is an employee-paid tax of 0.1% of wages with no cap. Employers withhold it from paychecks and report it on Form OQ. The 2025 legislature passed a bill to double the rate to 0.2% starting in 2026, but a referred measure has paused that increase, and the 0.1% rate remains in effect pending election results.
TriMet and Lane Transit District Taxes
Employers within the TriMet district (the Portland tri-county area) pay 0.8237% on all wages. Employers within the Lane Transit District around Eugene-Springfield pay 0.80%. Both are employer-paid and are not withheld from employees. Businesses outside both districts leave these lines blank.
Workers’ Benefit Fund
The Workers’ Benefit Fund assessment for 2026 is 1.8 cents per hour worked, calculated on hours rather than wages. Report actual hours paid for hourly employees. For full-time salaried staff you can use 160 hours per month without tracking; for part-time salaried staff, prorate from that 160-hour figure. The cost splits equally between employer and employee.
What to Gather Before You File
Have the following ready before you open Frances Online:
- Your Oregon Business Identification Number (BIN), the account number assigned at registration.
- Total gross wages paid during the quarter, before any deductions.
- Taxable wages by program. UI wages cap at $56,700 per employee; Paid Leave Oregon wages cap at $184,500. Withholding, STT, and the transit district taxes have no per-employee cap. WBF is figured on hours.
- Monthly worker count. Report UI-covered employees who worked or received pay during the payroll period that includes the 12th of each month. For weekly or biweekly payrolls, count workers on the payroll covering the 12th; for monthly payrolls, count everyone on that month’s payroll.
- Total hours worked by all employees during the quarter, for the WBF line.
- Total Oregon income tax withheld from all paychecks during the quarter.
You also need Form 132, the Employee Detail Report, listing each employee’s name, Social Security number, and individual wages. Form 132 is filed alongside Form OQ every quarter. It isn’t optional.
When It’s Due
Form OQ deadlines follow a fixed quarterly schedule:
- First quarter (January–March): April 30
- Second quarter (April–June): July 31
- Third quarter (July–September): October 31
- Fourth quarter (October–December): January 31
When a due date falls on a weekend or legal holiday, it moves to the next business day. Electronic filings are timely based on submission timestamp; paper filings are timely based on postmark.
How to Submit and Pay
Frances Online at frances.oregon.gov is the state’s primary portal. You link your BIN, enter the wage data, and the system auto-calculates fields like UI tax based on your taxable wages and experience rate. After review, you submit electronically and receive a confirmation number as proof of filing. Paper versions of Form OQ are available from the Oregon Employment Department’s tax forms page and mail to the Oregon Department of Revenue, PO Box 14800, Salem, OR 97309-0920. Employers required to make federal payroll tax payments electronically must also use electronic funds transfer for Oregon combined payroll taxes, unless total annual Oregon payments will not exceed $1,000.
Filing and paying are separate steps. Frances Online shows the balance due after submission, and you can initiate payment from there. Bank account payments can take up to seven business days to clear; card payments usually clear in two to three. Select the correct tax program and period when you pay. Oregon applies payments to whatever account and period you choose, and it may not catch a mismatch, which can leave one program overpaid and another short and generate a penalty notice on the underpaid side. Check your account history in Frances Online after the payment clears to confirm it landed where you intended.
Fixing Mistakes After Filing
If you find an error after submitting, file an Amended OQ/OA Form, either through Frances Online or on paper. A few rules make the process less mechanical than it looks:
- Wage changes ripple to Form 132. If you adjust UI or Paid Leave Oregon subject wages on the amended OQ, you must also amend Form 132 for the same quarter. Changing wages on Form 132 requires a matching OQ amendment.
- Fix Social Security number errors by amending Form 132 for every quarter the wrong number was reported.
- On any amended report, double-check wage amounts in the State Income Tax, Lane Transit District, and TriMet fields, even when those weren’t the source of the original error.
What Late Filing Costs
Late filing and late payment carry separate penalties, and they stack.
For withholding tax, ORS 314.400 imposes a 5% delinquency penalty on unpaid tax when you miss the due date. Because Form OQ is filed more frequently than annually, an additional 20% failure-to-file penalty applies if the report is still unfiled more than one month after the deadline. The Department of Revenue can then issue a formal demand to file within 30 days; ignoring that demand adds a 25% penalty on the tax deficiency the department estimates. Intentional evasion or a false return carries a penalty of 100% of the deficiency.
For unemployment insurance, ORS 657.663 sets late-filing penalties as a percentage of the taxable wage base. For 2026, the per-employee penalty is 0.02% of the $56,700 wage base (about $11) for each employee on the late report, per quarter. The minimum is $100 per quarter and the maximum is 5% of the wage base (about $2,835). Employers with no payroll in the quarter still owe a late-filing penalty, starting at $10 for the first offense and rising to $100 for repeat violations within three years.
Oregon charges 8% annual interest on unpaid tax for interest periods beginning on or after January 1, 2026. If the balance stays unpaid more than 60 days after assessment, another 4% per year is added, bringing the effective rate to 12%. Interest accrues on the tax itself, not on penalties.