Oregon pay stubs: income tax, Paid Leave and transit tax
Oregon paychecks carry state income tax, the Paid Leave Oregon contribution and a statewide transit tax. Here is what each deduction is and how it works.
Last reviewed
Rates on this page are for the 2026 tax year and are reviewed every January.
State income tax
Oregon has a graduated income tax, and its rates are on the high side compared with most states. There is no state sales tax, so income tax does most of the work, and it is usually the largest state line on an Oregon stub. Employees fill out Form OR-W-4 to set their state withholding, which can differ from their federal choices.
Other state payroll deductions
Oregon stubs typically have more state lines than most:
- Paid Leave Oregon. For 2026 the total contribution is 1% of wages, up to an annual wage limit. Employees pay 60% of it. Employers with 25 or more employees pay the other 40%; smaller employers do not owe the employer share but still must withhold and send in the employee share.
- Statewide transit tax. One-tenth of 1% (0.1%) of wages, withheld from employees. A planned increase did not pass, so the rate stays at 0.1%.
- Workers' Benefit Fund assessment. A small cents-per-hour charge that employers and employees share.
Local taxes
Most of Oregon has no local income tax. The exception is the Portland area: Metro's Supportive Housing Services tax and Multnomah County's Preschool for All tax are personal income taxes aimed at higher earners, administered by the City of Portland. Employers generally withhold them for employees whose pay passes the income thresholds, and employees can also ask to have them withheld. Transit district payroll taxes such as TriMet's are paid by employers and are not deducted from pay.
Federal withholding still applies
- Federal income tax per the employee's Form W-4.
- Social Security at 6.2% up to the annual Social Security wage base.
- Medicare at 1.45%, plus 0.9% on wages over $200,000.
Creating an Oregon pay stub with PayStubNest
Begin at /app/new, enter hours or salary, and select Oregon. The exact figures on each stub depend on the employee's pay, pay frequency, W-4 choices, deductions and year-to-date totals, and PayStubNest calculates all of it automatically: federal and Oregon income tax withholding, plus year-to-date totals kept in order across the year, which is what tells you when the Paid Leave Oregon wage limit is reached. Review any Portland-area local tax lines before you save. You can preview free and pay only for downloads.
Record-keeping tip
With several small percentage-based lines, rounding differences can build up over a year. Compare your year-to-date Paid Leave and transit tax totals with your quarterly filings. The Oregon Department of Revenue and Paid Leave Oregon publish the details; our FAQ covers common questions.