Oregon paychecks in 2026: what changed
Oregon's income tax rates stayed at 4.75% to 9.9% for 2026, but the withholding formula's inflation-adjusted amounts changed, and the minimum wage rose on July 1, 2026.
The changes
- New federal withholding tables. The IRS updated Publication 15-T for 2026, including changes from the 2025 tax law. The standard deduction is $16,100 single, $32,200 married filing jointly, and $24,150 head of household.
- Social Security wage base: $184,500 (up from $176,100). If you earn more, Social Security stops later in the year.
- Tips and overtime deductions for 2025–2028 — see below.
- Withholding formula for 2026: standard deduction $2,910 single and $5,820 married; $263 per allowance; up to $8,750 of federal tax subtracted.
- Paid Leave Oregon: still 1%, with employees paying 60%, on wages up to $184,500.
- Minimum wage from July 1, 2026: $16.80 in the Portland metro area, $15.55 standard, and $14.55 in non-urban counties (up from $16.30, $15.05 and $14.05).
Tips and overtime in 2026
New federal deductions apply for 2025 through 2028: up to $25,000 for qualified tips, and up to $12,500 ($25,000 for joint filers) for the extra "half" of time-and-a-half overtime. Both phase out above $150,000 of income ($300,000 joint).
These are deductions on your tax return. Your employer still takes Social Security and Medicare out of tips and overtime, and still withholds income tax unless you tell it otherwise. If you expect to claim them, you can put the expected amount in Step 4(b) of your W-4 (and in the Step 4(b) box above) so less income tax is withheld during the year.
Work out your 2026 Oregon paycheck →
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Sources
- IRS Publication 15-T (2026), Federal Income Tax Withholding Methods — Worksheet 1A and the annual percentage-method tables
- IRS Publication 15 (2026), Employer's Tax Guide — Social Security and Medicare rates
- Social Security Administration — 2026 wage base of $184,500
- IRS — tips and overtime deductions
- Oregon Department of Revenue — Oregon Withholding Tax Formulas, 150-206-436 (effective January 1, 2026) — formulas, $2,910/$5,820 standard deduction, $8,750 federal-tax cap and phase-out, $263 per allowance, examples 1–4, 8% rate with no withholding statement
- Oregon Department of Revenue — 2026 Form OR-W-4 instructions (150-101-402-1) — filing statuses; allowances not applied above $100,000 (single) or $200,000 (married); 8% with no withholding statement
- Oregon Department of Revenue — Statewide Transit Tax — 0.1% of wages; withheld even when no income tax is withheld
- Oregon Employment Department — 2026 UI tax and Paid Leave Oregon contribution rates — Paid Leave Oregon 1%, employees pay 60%; $184,500 wage limit in 2026
- Paid Leave Oregon — Contributions calculator — employees pay 60% of the 1% rate; $184,500 for 2026
- Paid Leave Oregon — Common questions — section 125 payments are not wages; employers with fewer than 25 employees still collect the employee share
- City of Portland Revenue Division — Personal income tax withholding (Metro SHS and Multnomah County PFA) — withheld for workers earning $200,000 or more: Metro 1% over $200,000; PFA 1.5% over $200,000 and 3% over $400,000; employees may opt in or out
- Oregon Department of Revenue — TriMet Transit Payroll Tax — employer paid
- Oregon Department of Revenue — Lane County Transit District Payroll Tax — employer paid
- Oregon Bureau of Labor and Industries (BOLI) — Oregon minimum wage — July 1, 2026–June 30, 2027: $16.80 Portland metro, $15.55 standard, $14.55 non-urban; tip credits are illegal
- BOLI — Oregon minimum wage schedule — July 1, 2025–June 30, 2026: $16.30 / $15.05 / $14.05
- BOLI — Overtime — 1.5× over 40 hours a week; manufacturing: overtime after 10 hours in a day
- BOLI — Paychecks — paydays no more than 35 days apart; final paycheck deadlines
- BOLI — Wage claim — complaints through BOLI's Complaint Resolution Center
- IRS Publication 15-T (2026) — Worksheet 1A — used to estimate the federal tax withheld that Oregon's formula subtracts