how can I owe more Oregon income tax than federal? (car insurance, home)

[Pomelo]

Originally Posted by Deserterer

No, its the result of Oregon's miserably low standard deduction.

That is encompassed by “high effective tax rates”. You pay more income taxes in Oregon because Oregon’s legislators have legislated it. You can keep going down the chain of reasoning and you will end up at a mix of historical political reasons, with one being that it helps offset lack of sales tax on most transactions.

[PamelaIamela]

Here's an idea. Don't pay it.
... and stay in touch so we learn what happens.

[MtnSurfer]

Originally Posted by PamelaIamela

Here's an idea. Don't pay it.
... and stay in touch so we learn what happens.

Ha, yeah, no, then he'll owe more in penalties! There's no escaping the tax man. They even caught Al Capone for that. Though Trump pardoned himself of all crimes. So, that might be the only exception.

Derek

[Deserterer]

Originally Posted by PamelaIamela

Here's an idea. Don't pay it.
... and stay in touch so we learn what happens.

Too late! But you can be sure I'll request my puny refund.

[StealthRabbit]

I have filed 'alien / non-resident worker' in Oregon many times for that portion of income generated while physically working in Oregon. After deductions (including federal taxes) it usually nets out to 5-6% of Oregon ONLY wages. Federal is typically 8-12% of all my combined state, foreign, business, investment income for me. I file for (7) of my LLCs and 3 sole proprietorships, so it's rather complicated. The Oregon calc and filing is simple in comparison.

Are you using software? Maybe you answered one question wrong that triggered a flag in the calculation that is now incorrect.

I would re-run it in another scenario or software.... Or via paper copies, which I trust less than software. (Since I might miss something on the paper forms).

What is your effective rate on your Oregon NET?

If over 9%.... Start digging.

[Deserterer]

Originally Posted by StealthRabbit

I have filed 'alien / non-resident worker' in Oregon many times for that portion of income generated while physically working in Oregon. After deductions (including federal taxes) it usually nets out to 5-6% of Oregon ONLY wages. Federal is typically 8-12% of all my combined state, foreign, business, investment income for me. I file for (7) of my LLCs and 3 sole proprietorships, so it's rather complicated. The Oregon calc and filing is simple in comparison.

Are you using software? Maybe you answered one question wrong that triggered a flag in the calculation that is now incorrect.

I would re-run it in another scenario or software.... Or via paper copies, which I trust less than software. (Since I might miss something on the paper forms).

What is your effective rate on your Oregon NET?

If over 9%.... Start digging.

Federal deduction $12,400
pro-rated Oregon non-resident deduction $1766


That's the difference. Over $10,000 that OR taxes me on that the feds don't.

[StealthRabbit]

Originally Posted by Deserterer

Federal deduction $12,400
pro-rated Oregon non-resident deduction $1766


That's the difference. Over $10,000 that OR taxes me on that the feds don't.

Oregon tax on that $10k is less than $900 at effective rate, likely $500 actual tax all washed out. (Bottom line)

[Deserterer]

Originally Posted by StealthRabbit

Oregon tax on that $10k is less than $900 at effective rate, likely $500 actual tax all washed out. (Bottom line)

$771


I never said it was a huge number, I said it was 8 times my federal tax

[StealthRabbit]

Sounds reasonable for the privilege of earning wages on Oregon, and not worth a relocation. Each state and country has a gotcha.

$771 would cover ~15 days of my WA property tax (up from $800/ yr on same old house). Texas schools take about 1/2 my WA obligation. Both states are Income tax free! My combined net income was less than $30k last yr, so property taxes alone ate 75% of my income. Oregon is similar to WA in property taxes, and is not considered a 'low tax state'.

No surprise your fed IRS was low... The feds are printing $$$$ by huge mountains we have never seen before and really tweaked taxes last yr (hold onto your wallet, as there will be payback.)

Consider other options than wage income for earnings in the future.

[leastprime]

Oregon has essentially a flat income tax that begins at a very low income level and no sales tax.
Washington has no income tax but taxes spending.
Which is better? Depends.