150-101-402 (Rev. 11-19)
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What is Oregon income tax withholding?
Oregon income tax withholding refers to the amount of
Oregon personal income taxes that are withheld from your
paychecks to cover your anticipated Oregon tax liability for
the year. By law, your employer must withhold a portion of
your wages based on your allowances and send the funds
to the Department of Revenue.
How is the amount of Oregon income tax
You report your marital status, withholding allowances, and
any additional amount you want withheld to your employer
by completing Form OR-W-4. This information, along with
Publication 150-206-436, Oregon Withholding Tax Formulas,
which estimates the tax due on your wages, is used by your
employer to withhold a specific amount per pay period.
If you have too much tax withheld, you may have a refund
when you file your tax return. If you have too little tax
withheld, you may owe tax when you file your tax return,
including penalty and interest. See Publication OR-17 for
penalty and interest information.
Why has Oregon created Form OR-W-4?
In prior years, Oregon employees were able to use the fed-
eral Form W-4 to determine and claim Oregon withholding.
However, due to federal tax law and form changes, the
federal form no longer calculates Oregon withholding
correctly. Form(s) W-4 that are submitted to your employer
after January 1, 2020 can’t be used to calculate Oregon with-
holding. Instead, use Form OR-W-4 to help you calculate
allowances for Oregon income tax withholding.
Form OR-W-4 is designed to estimate the amount of tax
you’ll need to have withheld for Oregon. Your 2020 tax
return may still result in a tax due or refund. For a more
accurate calculation, use the Oregon Withholding Calcu-
lator at www.oregon.gov/dor to calculate your allowances
How often do I need to complete Form OR-W-4?
Complete a new Form OR-W-4 when you start a new job
and whenever you have a change in your personal or finan-
cial situation that affects your tax situation. This includes
changes in your income, marital status, and number of
What will happen if I don’t complete Form OR-W-4?
Your employer will refer to the most recently submitted ver-
sion of Form OR-W-4 or Form W-4 when determining with-
holding. If you don’t complete Form OR-W-4, your employer
will withhold for Oregon based upon the following order:
• An Oregon-only version of the federal Form W-4 for a year
prior to 2020.
• Federal Form W-4 for a year prior to 2020.
• Eight percent of your wages or other income requiring
Two-earners or multiple jobs. If you and your spouse work
or if you have more than one job, complete the following
steps on the Form OR-W-4 for the highest paying job only:
• Enter the allowances from Worksheet C, line C5 on Form
OR-W-4, line 2.
• Enter the additional per-period amount to withhold, if any,
from Worksheet C, line C8 on Form OR-W-4, line 3.
For all other (lower-paying) jobs, skip the worksheets and
claim -0- allowances on Form OR-W-4 line 2, and -0- addi-
tional amount to be withheld on line 3.
If you (including your spouse) have more than two jobs, use
the online calculator for more accurate results.
Wages or adjusted gross income (AGI) that exceed the
threshold. Do you expect to have wages or AGI on your 2020
return that are more than $100,000 (or $200,000 if using the
married filing jointly or the qualifying widow(er) filing sta-
tus)? Consider using the online calculator to determine the
correct amounts to claim on your Form OR-W-4. Otherwise,
skip the worksheets. Check the appropriate box on line 1
for your marital status and enter -0- on line 2. You may owe
additional tax when you file your return.
Helpful tip: AGI. Your AGI is your total income minus federal
adjustments to income. The amount on your 2019 federal
Form 1040, line 7, may help you estimate your 2020 AGI.
Mid-year changes. If you’re changing your allowances part-
way through the year and you claimed too many allowances
for the first part of the year, use the online calculator to
determine the additional amount you need withheld to make
up for the shortage you had during the first part of the year.
Otherwise, you may owe tax, penalties, and interest when
you file your return. See Publication OR-17 for penalty and
Pension or annuity payments. Form OR-W-4 can be used to
designate the amount of withholding on your pension or
annuity payments. Generally, whenever Form OR-W-4 or
the instructions refer to jobs or wages, substitute these terms
with “pension or annuity” or “pension or annuity payment.”
If you’ve opted out of federal withholding, you’re automati-
cally opted out from Oregon withholding also. See Publica-
tion OR-ESTIMATE to determine the amount of estimated
tax payments you need to make.
Oregon Withholding Instructions