Oregon Corporate Minimum Tax: Tiers, Exemptions, and Deadlines

The Oregon corporate minimum tax is a floor that every corporation doing business in the state owes each year, whether or not it turns a profit. S-corporations pay a flat $150. C-corporations pay between $150 and $100,000 on a sliding scale tied to their Oregon sales. If the regular excise tax calculated on net income comes out higher, the corporation pays that instead — but never less than the minimum.¹

How the Minimum Fits Into Oregon’s Corporate Excise Tax

Oregon taxes corporate net income at 6.6 percent on the first $1 million and 7.6 percent on anything above that.² When you file Form OR-20, you calculate both the excise tax on net income and the minimum tax based on Oregon sales, then pay whichever is larger.³

The minimum matters most to corporations with significant Oregon sales but thin margins, break-even years, or losses. A business with $8 million in Oregon revenue that posts a loss still owes $7,500. Oregon treats that as the cost of accessing the state’s market.

C-Corporation Minimum Tax Tiers

C-corporations owe a minimum tax on this graduated scale, keyed to Oregon sales:¹

Under $500,000: $150
$500,000 to under $1 million: $500
$1 million to under $2 million: $1,000
$2 million to under $3 million: $1,500
$3 million to under $5 million: $2,000
$5 million to under $7 million: $4,000
$7 million to under $10 million: $7,500
$10 million to under $25 million: $15,000
$25 million to under $50 million: $30,000
$50 million to under $75 million: $50,000
$75 million to under $100 million: $75,000
$100 million or more: $100,000

The jumps get steep at the top of the scale. Crossing from $9.9 million to $10.1 million in Oregon sales doubles the minimum from $7,500 to $15,000. If your sales sit near a tier boundary, tracking them through the year is worth the effort, because a modest revenue bump can push the minimum up sharply.

S-Corporation Minimum Tax

S-corporations pay a flat $150, no matter how much Oregon revenue they generate.¹ Oregon keeps this low because S-corporation income flows through to the shareholders, who pay Oregon personal income tax on their share. The $150 applies whether the S-corporation books $50,000 or $50 million in sales.

Partnerships and LLCs taxed as partnerships are not subject to the corporate minimum tax. They file informational returns, and income is taxed at the partner or member level.

How Oregon Sales Are Determined

The tier you land in depends on your “Oregon sales” as calculated under the state’s apportionment rules. For tangible goods, a sale counts as an Oregon sale when the product is delivered or shipped to a buyer in Oregon, regardless of where it shipped from.⁴

For services and intangibles, Oregon uses market-based sourcing. Revenue is attributed to Oregon based on where the customer receives the service or uses the intangible, not where your employees or offices sit.⁵ A Portland consulting firm serving a California client would not count that revenue as an Oregon sale. An out-of-state company serving Oregon clients does have to include those receipts. This catches some out-of-state businesses off guard, especially those selling digital products or professional services into Oregon.

Multistate corporations apportion income using the sales-factor rules in ORS 314.650 through 314.665. Oregon-only businesses that don’t need to apportion still have to calculate what their Oregon sales would be under those rules.¹

Credits Cannot Reduce the Minimum

Here is the detail that catches business owners off guard: no tax credit can be used to reduce, pay, or satisfy the minimum tax.¹ Research and development credits, enterprise zone credits, and other Oregon credits can only offset the portion of your tax bill that exceeds the minimum. A corporation with a $15,000 minimum and $40,000 in calculated excise tax can use credits to bring the $40,000 down to $15,000, and no further.

The minimum also can’t be prorated for a partial year, except when a corporation changes its accounting period.¹ Start doing business in Oregon on November 1 and you owe the full minimum for that year.

Who Is Exempt

Under ORS 317.080, several categories of organizations are exempt from the corporate excise tax and its minimum: nonprofits recognized under IRC 501(c) and 501(j), religious and apostolic organizations under 501(d), cooperative hospital and educational service organizations under 501(e) and 501(f), qualified state tuition (529) programs, farmers’ cooperatives under IRC 521, qualifying residential care corporations for the elderly, and peoples utility districts under ORS chapter 261.⁶

Exemption tracks federal recognition. If the IRS has issued a determination letter confirming qualifying status, the organization is exempt on its exempt-function income. Unrelated business income is still taxable and still gets reported on an Oregon return.

Filing Deadlines and Forms

Oregon corporate returns are due one month after the federal deadline for the same entity type. Calendar-year C-corporations file Form OR-20 by May 15. Calendar-year S-corporations file Form OR-20-S by April 15. If a due date falls on a weekend or state holiday, it moves to the next business day.⁷

Form OR-20 walks the C-corporation through both the excise tax calculation on net income and the minimum tax based on Oregon sales, and the return uses whichever is greater.⁸ Form OR-20-S reports the $150 S-corporation minimum and pass-through information.⁹ The Department of Revenue accepts electronic filing and payment through Revenue Online, and paper returns go to the Salem office. Late filing or late payment triggers penalties and interest on top of the tax owed.

The Corporate Activity Tax Is a Separate Bill

Oregon’s Corporate Activity Tax (CAT) is a different tax with its own return, its own quarterly estimated payments, and its own penalty rules. It applies to businesses with more than $1 million in Oregon commercial activity and is $250 plus 0.57 percent of taxable commercial activity above $1 million.¹⁰ The CAT does not replace or reduce the corporate excise tax or the minimum. If you owe both, you pay both.

1
Oregon State Legislature. Oregon Revised Statutes 317.090 – Minimum Tax
2
Oregon State Legislature. Oregon Code 317.061 – Tax Rate
3
Oregon Department of Revenue. 2024 Form OR-20 – Oregon Corporation Excise Tax Return
4
Oregon State Legislature. Oregon Code 314.665 – Determination of Sales Factor; Use of Market Sourcing; Inclusions and Exclusions; Definitions
5
Oregon Secretary of State. OAR 150-314-0435 – Market-Based Sourcing
6
Oregon State Legislature. Oregon Code 317 – Corporation Excise Tax
7
Oregon Department of Revenue. Corporation Excise and Income Tax: Businesses
8
Oregon Department of Revenue. 2024 Form OR-20 Instructions
9
Oregon Department of Revenue. 2024 Form OR-20-S Instructions
10
Oregon Department of Revenue. Corporate Activity Tax (CAT)