If your partnership does business in Oregon and is required to file Form OR-65, you owe the Oregon partnership minimum tax of $150 for the year, regardless of income, partner count, or whether you turned a profit.1Oregon Public Law. Oregon Code 314.725 – Privilege Tax Applicable to Partnerships It’s a flat privilege tax under ORS 314.725 for operating under Oregon’s legal framework, and the amount doesn’t change whether you have two partners or two hundred, or whether Oregon receipts were $500 or $5 million.
Who Owes the $150
Two conditions trigger the tax: the partnership was doing business in Oregon during the year, and it’s required to file Form OR-65.2Oregon Department of Revenue. Partnership Information “Doing business” means any profit-seeking activity in the state, including selling goods, providing services, or earning income from Oregon property.
Under ORS 314.724, every partnership with a resident partner or Oregon-source income must file a return listing income, gain, loss, and deduction items along with each partner’s name, address, and distributive share.3Oregon Public Law. Oregon Code 314.724 – Information Return, Penalty, Rules This applies to general partnerships, limited partnerships, and LLCs treated as partnerships for federal tax purposes.
One boundary worth noting: a partnership registered in Oregon that had no actual business activity during the year does not owe the minimum tax.4Oregon Department of Revenue. Form OR-65 Instructions Holding an active registration alone doesn’t trigger the obligation; the partnership has to engage in profit-seeking activity.
How Much You Pay
The amount is $150. Flat. It doesn’t scale with gross receipts, net income, or the number of partners. Every qualifying partnership pays the same figure, which makes it one of the more predictable items in an annual compliance budget.
There’s one proration rule. If you file a short-year return solely because the IRS approved a change in your accounting period, the $150 is prorated by month. A six-month short year carries a $75 minimum tax; a three-month short year is $38. Initial and final returns do not qualify for proration and still owe the full $150.4Oregon Department of Revenue. Form OR-65 Instructions
When It’s Due
Calendar-year partnerships must file Form OR-65 and pay the $150 by March 15. Fiscal-year filers are due by the 15th day of the third month after their fiscal year ends.2Oregon Department of Revenue. Partnership Information When the due date falls on a weekend or legal holiday, the deadline shifts to the next business day. March 15, 2026 is a Sunday, so the effective due date for tax year 2025 is March 16, 2026.
A valid federal extension automatically extends your Oregon deadline, so no separate state extension form is needed.2Oregon Department of Revenue. Partnership Information Federal extensions come through IRS Form 7004, which grants an automatic six months.5Internal Revenue Service. About Form 7004 An extension gives you more time to file, not more time to pay. The $150 is still due by the original deadline, or interest accrues.
How to File and Pay
Oregon accepts Form OR-65 electronically through the IRS Modernized e-File (MeF) platform. If the partnership’s federal return must be e-filed, the Oregon return must also be e-filed.2Oregon Department of Revenue. Partnership Information The federal threshold is low: 10 information returns of any type in a calendar year, aggregated across all return types. Enough K-1s and 1099s combined can push a small partnership past that line and into mandatory e-filing.6Internal Revenue Service. Who Must File Information Returns Electronically
Partnerships under the threshold can file on paper. You’ll need the partnership’s Federal Employer Identification Number (FEIN) and its Oregon Business Identification Number (BIN). The form reports each partner’s distributive share of Oregon-source income, deductions, and credits. Confirm that partner names and tax ID numbers match your federal filing, because mismatches are a common cause of processing delays.
Payment is a separate step from submitting the return. Electronic filers can pay by Electronic Funds Transfer from a business bank account. Paper filers should send a check or money order with Form OR-65-V, the payment voucher that ties the payment to the return.7Oregon Department of Revenue. Form OR-65-V Instructions Write the tax year, “Form OR-65-V,” and your FEIN on the payment itself in case it’s separated from the voucher.
What Happens If You File Late
The penalty structure is more aggressive than the $150 tax suggests. Under ORS 314.724, a partnership that fails to file on time or files an incomplete return faces a penalty of $50 per partner per month, capped at five months.3Oregon Public Law. Oregon Code 314.724 – Information Return, Penalty, Rules A ten-partner partnership is looking at $500 a month and up to $2,500 total, well above the underlying tax. Even a two-partner operation can accumulate $500 over five months.
Procedurally, under OAR 150-314-0487 the Department of Revenue won’t impose this penalty unless the partnership fails to file after being asked to in writing.8Oregon Public Law. OAR 150-314-0487 – Partnership Penalty The department can also waive all or part of the penalty for reasonable cause.3Oregon Public Law. Oregon Code 314.724 – Information Return, Penalty, Rules Once a written notice arrives, though, the clock starts moving quickly.
Skip filing for three consecutive years and the stakes rise sharply. Under ORS 305.992, a three-year failure triggers a penalty of 100 percent of the tax liability for each of those years, on top of other penalties.9Oregon Public Law. Oregon Code 305.992 – Civil Penalty for Failure to File Return For a partnership that owes only the $150 minimum, the dollar impact stays modest; for one with larger Oregon obligations, it compounds fast.
Federal penalties run alongside Oregon’s. Under 26 U.S.C. § 6698, the IRS assesses a separate late-filing penalty based on a statutory amount per partner per month for up to 12 months, adjusted annually for inflation. The base amount is $195 per partner per month, with inflation adjustments pushing it higher in recent years.10Office of the Law Revision Counsel. 26 USC 6698 – Failure to File Partnership Return A late Oregon return usually means a late federal return too, and the combined penalties can far exceed the tax owed.
What the $150 Tax Doesn’t Cover
The minimum tax sits alongside two other filings a partnership may face. Oregon’s Pass-Through Entity Elective (PTE-E) Tax is an optional annual election that lets a partnership pay Oregon income tax at the entity level as a workaround to the federal SALT cap; electing it does not replace the $150 minimum tax, and partnerships owe both.11Oregon Department of Revenue. Pass-Through Entity Elective (PTE-E) Tax Separately, under OAR 150-314-0515, a partnership must file a composite return if one or more nonresident owners request it, paying Oregon tax on their behalf.12Oregon Public Law. OAR 150-314-0515 – Oregon Composite Tax Return Neither filing changes the $150 obligation, but both may affect what else you owe and when.