Oregon 'kicker' tax credit hits nearly $1.9 billion, how much will you see? | KATU (2024)
PORTLAND, Ore. – With a nearly $1.9 billion tax surplus, Oregon taxpayers will be seeing a “kicker” credit on their taxes in the 2021 year.
Instead of checks, the state Office of Economic Analysis says the surplus will go back to Oregonians through a credit on their 2021 state personal income taxes filed in 2022.
Taxpayers are eligible if they filed a 2020 tax return and had tax due before credits, the state says.
The kicker is triggered when actual revenue exceeds the projected revenue by at least 2%.
More from the Oregon Office of Economic Analysis:
Even if you don't have a filing obligation for 2021, you still must file a 2021 tax return to claim your credit. There will be detailed information on how to claim your credit in the 2021 Oregon personal income tax return instructions: Form OR-40 for full-year Oregon residents, Form OR-40-P for part-year residents, and Form OR-40-N for nonresidents. Composite and fiduciary-income tax return filers are also eligible.
Keep in mind that the state may use all or part of your kicker to pay any state debt you owe, such as tax due for other years, child support, court fines, or school loans.
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 percent. This percentage is determined and certified 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.
As an expert in taxation and fiscal policies, I bring a wealth of knowledge and expertise to elucidate the intricacies of the "kicker" credit in Oregon, based on the provided article. My background in economics and public finance allows me to provide a comprehensive understanding of the concepts involved.
Firstly, let's delve into the context of the article. Oregon is experiencing a significant tax surplus of nearly $1.9 billion, leading to the implementation of a "kicker" credit. The kicker mechanism is a unique feature in Oregon's tax system, triggered when the actual revenue surpasses the projected revenue by at least 2%. This surplus is substantial, and its impact on taxpayers is noteworthy.
The state's Office of Economic Analysis plays a crucial role in determining the surplus and subsequent kicker credit. This office utilizes sophisticated forecasting models to project revenue, and the fact that the kicker is triggered indicates their commitment to accuracy in economic predictions.
The distribution of the surplus to taxpayers is facilitated through a credit on their 2021 state personal income taxes, to be filed in 2022. Unlike traditional methods involving physical checks, the credit system streamlines the process, making it more efficient for Oregonians.
Estimates provided in the article suggest that the median credit will be $420, with an average credit of $850. These figures are indicative of the substantial impact on individual taxpayers, and the "What's My Kicker?" calculator on the state's website allows individuals to determine their specific credit amount.
To be eligible for the kicker credit, taxpayers must have filed a 2020 tax return and had tax due before credits were applied. This eligibility criterion ensures that those who contributed to the state's revenue in the previous year are beneficiaries of the surplus.
It's noteworthy that even individuals without a filing obligation for 2021 must file a tax return to claim the credit. This inclusionary approach aligns with the state's commitment to ensuring that all eligible individuals receive their due credit.
The article also highlights that the state may use part or all of the kicker to pay off outstanding state debts, such as taxes from other years, child support, court fines, or school loans. This is a prudent fiscal strategy to address existing financial obligations.
For those wondering how to calculate their kicker credit, the article provides a clear formula. Taxpayers need to multiply their 2020 tax liability before any credits by 17.341 percent. This percentage is determined and certified by the Oregon Office of Economic Analysis. Adjustments are made for those who claimed a credit for tax paid to another state.
In summary, the "kicker" credit in Oregon is a manifestation of sound fiscal policies and economic forecasting. The surplus, distribution mechanism, eligibility criteria, potential debt offset, and the calculation methodology collectively contribute to a comprehensive understanding of this unique aspect of the state's tax system.
So, how much will you get? You can calculate your kicker credit by multiplying line 22 of your 2022 Form OR-40 by 44.28%. For example, if line 22 on your 2022 Oregon return is $5,000, your kicker credit will be $2,214.
“We also urge anyone who is owed a kicker to file and claim it.” The tax filing deadline is April 15. Once submitted, returns are sent out in the order taxes were received. The Oregon Office of Economic Analysis estimates that “the typical Oregon taxpayer will receive a $790 credit on their tax returns” in 2024.
Your kicker is either included in your refund or it will reduce the amount of tax you owe. The Oregon “kicker" tax credit is how the state returns money to taxpayers when there is a revenue surplus. You need to have filed a 2022 tax return to get the kicker credit on your 2023 tax return.
(AP) — In Oregon, a record $5.6 billion in revenue surplus will be returned to taxpayers in the form of an income tax credit known as a “kicker,” officials said Monday. The state's Office of Economic Analysis, which confirmed the amount of the kicker in a news release, described it as “the largest in state history.”
The kicker is an Oregon institution, triggered whenever personal income taxes and other non-corporate revenue streams come in at least 2% higher than state economists predicted when legislators were building a two-year budget. In those increasingly common cases, all the excess is “kicked” back to taxpayers.
If Oregon and another state tax the same income, you may be eligible to claim a credit for taxes paid to the other state. If you have income that qualifies for the credit for taxes paid to another state and you are a part year resident, you must manually add this into the program.
Taxpayers who have not filed a 2022 Oregon income tax return or did not have income tax due for 2022 are not eligible to receive a kicker. The same is true for filers who didn't complete the filing process last year because they failed to respond to letters from the department seeking more information.
A refundable tax credit is a credit you can get as a refund even if you don't owe any tax. Tax credits are amounts you subtract from your bottom-line tax due when you file your tax return. Most tax credits can reduce your tax only until it reaches $0.
4.75% on the first $4,050 of taxable income. 6.75% on taxable income from $4,050 to $10,200. 8.75% on taxable income from $10,200 to $125,000. 9.90% on taxable income from $125,000 to $350,000.
In October, the Oregon Office of Economic Analysis (OEA) confirmed a more than $5.61 billion revenue surplus in the 2021-2023 biennium, triggering a tax surplus credit, or “kicker,” for the 2023 tax year.
The Oregon Legislature created the “kicker” in 1979. Essentially, when the total revenue collected in a biennium exceeds the official revenue projection for the biennium by more than 2 percent, all of the surplus revenue is returned to taxpayers. Voters enshrined the “kicker” into the Oregon Constitution in 2000.
The 2% surplus kicker is part of the Oregon Constitution (Article IX, Section 14). It gives taxpayers an income tax refund or credit if actual revenues for the biennium are more than 2% higher than forecast at the time the budget was adopted.
6 kickers are tied for the best field-goal percentage by a kicker with 14+ games played in a season, hitting 100.0 percent. The first three are Mason Crosby and Jason Myers in 2020 and Mike Vanderjagt in 2003.
Even taxpayers who don't have a filing obligation for 2023, still must file a 2023 tax return to claim their credit. The kicker is based on Oregon income tax paid in 2022, not federal income tax paid.
Charlie Gogolak, the highest kicker ever drafted, was in the league for six years and made only 55.9 percent of his kicks. Jan Stenerud, a Hall of Fame kicker who spent 19 years in the NFL, made 66.8 percent of his career tries. By comparison, the league average for field-goal percent in 2022 was 85 percent.
Your OR-40 is the state tax return form you prepared for the state and sent to the state to seek a tax refund from the state. It will be in your online account for 2022.
You'll need to find your copy of your 2022 Oregon state return. The main resident Oregon return form is a form OR-40. Line 31 on that form should be your tax liability.
Your adjusted gross income (AGI) is your total (gross) income from all sources minus certain adjustments such as educator expenses, student loan interest, alimony payments and retirement contributions.
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