how can I owe more Oregon income tax than federal? (Portland: sales, crime)

[Deserterer]

Is that even possible? I worked in OR as a non-resident (for the first and last time) and unless I've done something horribly wrong, it appears that my tax in Oregon is 7 times my federal income tax.
Huh? Is that even possible? The 12,400 standard federal deduction wipes out most of my federal liability but Oregon only gives me 2315 of that. This appears to be the main source of the problem.

I have never heard of paying more state than federal taxes, but I've never worked in OR before.


Tell me I've done something wrong, please.

[Deserterer]

Almost 8 times more OR state income tax than federal tax!!!!!! Unreal!


Somethings wrong with this picture.

[Hemlock140]

We have none here but used to live in California, and it seems to me that there are many ways this can happen, a few:

1. Your Federal W-4 and your Oregon W-4 do not have the same withholding indications
2. The federal government offers deductions that the state does not
3. Oregon income tax rate is high because of no sales tax

[Deserterer]

Originally Posted by Hemlock140

We have none here but used to live in California, and it seems to me that there are many ways this can happen, a few:

1. Your Federal W-4 and your Oregon W-4 do not have the same withholding indications
2. The federal government offers deductions that the state does not
3. Oregon income tax rate is high because of no sales tax

Well like I said #2 appears to be the main culprit. I get over 10,000 more on my federal standard deduction than OR gave me.



Its insanity. I'll never work in OR again. I end up giving them the majority of my federal refund AND I DON"T EVEN LIVE THERE.

[Futuremauian]

Same thing in Hawaii. With all of the Federal tax breaks this year my grandson got a refund from the Fed and owed Hawaii an additional $1500. I kept thinking I had done something wrong on his return. Nope. It was correct.

Hawaii was also the ONLY state that didn't extend the due date for taxes this year.

[maverick974]

One of the many reasons I left Oregon. High taxes and rapidly getting higher, toothless representation in State government except for the Portland area, and at least where I was living, it was just a "good ole boys" network. It's not what you know, it's who ya know.
Oh..... All the rain. Ha

[Deserterer]

And here's another thing: They are taxing me on ALL of my Oregon income, but I can only claim a percentage of the puny OR standard deduction because I'm a non-resident who worked outside of Oregon too. So I only get less than 75% of the miserable $2315 standard deduction.



Huh? This is pure insanity. It barely sounds legal.

[Pomelo]

It's perfectly legal. There is no reason different governmental entities would not be able to tax at different tax rates. It is just a consequence of Oregon's high effective income tax rates.

[Deserterer]

Originally Posted by Pomelo

It's perfectly legal. There is no reason different governmental entities would not be able to tax at different tax rates. It is just a consequence of Oregon's high effective income tax rates.

No, its the result of Oregon's miserably low standard deduction. I've never lived or worked in a state with an income tax that doesn't have a standard deduction pretty close to the federal standard deduction. OR isn't alone in that regard but its my first encounter with it and its a very unpleasant surprise. I see no reason why Oregon should get 8 times what the feds get.



What benefits do I receive from these tax dollars? Or looking at it another way, What crime did I commit in OR to deserve this? Is this punishment for taking work away from an Oregonian? (I didn't BTW, nobody else wanted the miserable job...). Is it my toll for just passing thru?

[MtnSurfer]

Wow, you're making more glad I chose this side of the border. We looked at many Portland neighborhoods as well. But the financial benefits of living in WA made it an easier sell. Granted I don't work in Oregon. If, I did, like you, there would be no escaping the tax man digging deeply. But even when we lived in CA, state tax was never higher than federal. Geesh! Sound like you got the short end of that stick big time. It sounds like they're screwing non-residents more, like out of state college tuition.

Derek