Here’s the Kicker…Once Again

As Oregon residents, you have probably grown accustomed to Oregon’s—for better or worse—quirky state and local governmental structure. A prime example of this is Oregon’s “Kicker Tax rebate.” We have covered this topic before, as recently as 2018. Well, it’s 2021, and it’s time to revisit this issue, as the Oregon Office of Economic Analysis (OEA) has confirmed that there will be a tax surplus credit or “kicker” for the 2021 tax year to be filed in 2022. What is this “kicker” and how might it affect you?

In Oregon, the kicker goes into effect when the actual state revenue exceeds the forecasted revenue by at least 2%. Then, an amount calculated by OEA is returned to the taxpayers through a credit on their tax returns. The kicker law is unique to Oregon. 

To calculate the amount of your credit, multiply your 2020 tax liability before any credits — line 22 on the 2020 Form OR-40 — by 17.341%, a percentage determined by OEA. Taxpayers who claimed a credit for tax paid to another state would need to subtract the credit amount from their liability before calculating the credit.

For anyone filing for their personal income tax, there is a calculator on the Oregon Department of Revenue’s website that will calculate your kicker amount for you. You’ll need to enter your name, Social Security number, and filing status for 2020 and 2021. You are eligible to claim the kicker if you filed a 2020 tax return and had tax due before credits. You must file a 2021 tax return to claim your kicker credit, even if you don’t have a filing obligation for the year.

While straightforward, we understand that questions might arise from this quirky state law, and we’re always eager to assist you.

Multnomah Group is a registered investment adviser, registered with the Securities and Exchange Commission. Any information contained herein or on Multnomah Group’s website is provided for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Multnomah Group does not provide legal or tax advice.

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