A new state tax credit could provide up to $5,000 for Oregon’s lowest income families who file an Oregon state income tax return.
The Oregon Kids Credit, created by the Legislature last year, is a refundable credit for low-income people with young dependent children. For those with a modified adjusted gross income (MAGI) of $25,000 or less, the full credit is $1,000 per child for up to five dependent children under the age of six at the end of the tax year—a maximum benefit of $5,000. A partial credit is available for individuals and families with an MAGI up to $30,000.
When combined with the federal Earned Income Tax Credit and the Oregon Earned Income Credit, it could help boost the tax refund for the lowest income families to more than $13,000.
The EITC is for people with an adjusted gross income of up to $63,398 in 2023. Families may be eligible for a maximum refundable credit of $7,430 on their federal tax return, and a maximum Oregon EIC of $891 on their state tax return.
All three credits are fully refundable, meaning the portion of the credit that is larger than what a taxpayer owes can be refunded. Taxpayers may even be able to claim the credits and receive a tax refund if they don’t normally file a tax return.
To claim the credits, taxpayers must file a return. To assist taxpayers, Oregon offers several free filing options, including free fillable forms and the new Direct File Oregon. Taxpayers who need help filing their taxes can also find free assistance options on the agency website.
Families who are eligible for the Oregon Kids Credit are also likely eligible for the partially refundable Working Family Household and Dependent Care Credit (WFHDC), which helps low- to moderate-income families pay for the care of their dependents while they’re working, looking for work, or attending school.
To encourage Oregonians to save for college and job training, the Education Savings Credit for Oregon 529 Plan contributions allows single filers to receive a refundable credit of as much as $170 ($340 for joint filers) if they contribute to an Oregon College Savings Plan account before tax day. The refundable tax credit is also available for contributions to an Oregon ABLE Savings Plan account, which empowers people experiencing disabilities to invest and build financial security without jeopardizing their eligibility for vital state and federal benefits.
For more information about the federal EITC, the Oregon EIC, the Oregon Kids Credit and other similar credits, go to the Tax benefits for families page.
Taxpayers can dial 2-1-1 or visit the Oregon Department of Revenue website to find free tax preparation sites by using our interactive map. For more information on the EITC, visit https://www.eitc.irs.gov/. For questions about Oregon taxes, call the Department of Revenue at 503-378-4988.
Refunds distribution has begun
The annual refund hold that is part of the agency’s fraud prevention efforts has been completed and the department began issuing the first refunds of the 2024 tax season Monday.
In 2024 Oregon is returning $5.61 billion in surplus revenue to taxpayers in the form of a “kicker” tax credit. Taxpayers will receive their kicker as part of their refund, or the kicker can reduce the tax they owe.
Most refunds are issued within two weeks, but returns that need more review may take up to 16 weeks before a refund is issued. Taxpayers can check the status of their refund by using the department’s Where’s My Refund? tool on Revenue Online. A video outlining the refund process and timelines is also available to help taxpayers understand the process.
