Oregon Estate Tax 2026: $1M Exclusion, Rates, SB 1511 Failed
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Quick Answer
Oregon taxes an estate from its first dollar above $1,000,000 at 10%, rising in ten steps to 16% on the part above $9,500,000 (ORS 118.010(4), as of October 21, 2026). There is no zero-rate cliff: tax is $0 at $1,000,000 and the schedule climbs from there. Our arithmetic gives $50,000 at a $1.5 million taxable estate, $205,000 at $3 million, $425,000 at $5 million and $1,102,500 at $10 million. A return is required once the gross estate reaches $1,000,000 and is due 12 months after death. SB 1511 (2026), which would have moved the threshold to $2.5 million, was still sitting in the House Committee on Revenue in the Legislature’s own record of June 10, 2026 and was reported to have failed; the repeal initiative, IP 2026-051, is reported not to be on the November 3, 2026 ballot. For a death in 2027 the table above is still the law we can read.
Key Takeaways
- The rate table in ORS 118.010(4) starts at $1,000,000: 10.0% on the part from $1,000,000 to $1,500,000, then 10.25%, 10.5%, 11.0%, 11.5%, 12.0%, 13.0%, 14.0% and 15.0%, and 16.0% on the part above $9,500,000 (base tax $1,022,500 at that line). The 2025 Form OR-706 instructions print the same table.
- Our arithmetic: $50,000 at $1,500,000 (3.33% average), $205,000 at $3,000,000 (6.83%), $425,000 at $5,000,000 (8.50%) and $1,102,500 at $10,000,000 (11.03%), with all property in Oregon and the figure taken as the Oregon taxable estate.
- Oregon starts from the federal taxable estate, adds back the federal deduction for state death taxes, and subtracts Oregon special marital property (ORS 118.010(3)). The statute ties its terms to the Internal Revenue Code as of December 31, 2010 (ORS 118.007), so the current federal exemption does not change the Oregon bill.
- A resident with real estate or tangible property in another state multiplies the tax by (Oregon real property + Oregon tangible property + intangibles) divided by the gross estate (ORS 118.010(5)). On a $5,000,000 taxable estate with $1,400,000 of out-of-state real estate in a $5,600,000 gross estate, the tax falls from $425,000 to $318,750 (our arithmetic).
- The text we read has no portability provision. Oregon instead has an Oregon special marital property election (ORS 118.013, 118.016) and separate elections under federal provisions (118.010(8)); in a $6,000,000 couple example, using the first $1,000,000 at the first death lowers the second-death tax by $117,500 (our arithmetic, no growth).
- SB 1511 as engrossed on February 20, 2026 kept a $1,000,000 deduction, set a $2.5 million subject threshold, phased the tax in over the next $500,000 and replaced the rates with a new table from 12.75% to 19.90%. By our arithmetic it would have lowered the tax between $2.5 million and about $2.89 million and raised it above that, for example $547,500 instead of $425,000 at $5,000,000. It was not enacted, according to the OLIS record and a League of Women Voters of Oregon report.
- Return and payment are due 12 months after death (ORS 118.100(1)); the 2025 DOR instructions set a 5% penalty, 20% more if the return is over three months late, and 8% interest for periods beginning January 1, 2026.
CSV · 64 rows
Oregon estate tax: statute table, filing rules, SB 1511 as engrossed and tax by estate size
64 rows: the ten bands of ORS 118.010(4), filing, due date, penalty and interest rules, the out-of-state ratio, the Department of Revenue worked example, the SB 1511 A-Engrossed terms and rate table, our tax grid for current law and for the bill, and the status of the repeal initiative.
What the statute says
ORS 118.010(2) imposes a tax on a transfer of the property of each resident decedent and of each nonresident decedent whose estate includes Oregon real property or Oregon tangible personal property. The base is the Oregon taxable estate: the federal taxable estate, increased by the federal deduction for state death taxes and by property of a surviving spouse that had an Oregon special marital property deduction earlier, and reduced by Oregon special marital property, the natural resource exemption of ORS 118.145 and “any other applicable exclusions or deductions.”
The term “federal” here is frozen. ORS 118.007 says references to the Internal Revenue Code mean the Code “as amended and in effect on December 31, 2010,” unless the Legislature says otherwise. That is why the federal basic exclusion of $15,000,000 for 2026 deaths, which we explain in our federal estate tax guide, plays no part in the Oregon schedule.
| Taxable estate at least | But less than | Tax at the lower figure | Rate on the excess |
|---|---|---|---|
| $1,000,000 | $1,500,000 | $0 | 10.0% |
| $1,500,000 | $2,500,000 | $50,000 | 10.25% |
| $2,500,000 | $3,500,000 | $152,500 | 10.5% |
| $3,500,000 | $4,500,000 | $257,500 | 11.0% |
| $4,500,000 | $5,500,000 | $367,500 | 11.5% |
| $5,500,000 | $6,500,000 | $482,500 | 12.0% |
| $6,500,000 | $7,500,000 | $602,500 | 13.0% |
| $7,500,000 | $8,500,000 | $732,500 | 14.0% |
| $8,500,000 | $9,500,000 | $872,500 | 15.0% |
| $9,500,000 | no limit | $1,022,500 | 16.0% |
We read this table from the statute copy at oregon.public.law (the Legislature’s own site was not reachable from our network) and checked it against the table printed in the Department of Revenue’s 2025 Form OR-706 instructions; the two agree row by row. We also checked that each base amount equals the one before it plus the band width times its rate. The mirror lists 2023 c.286 §3 as the last amendment of the section and says its text is current through the 2024 session; a 2025 change would be in the 2025 edition, which the mirror does not yet reflect, so check the section on the Legislature’s site before relying on a 2027 death.
The $1 million is a starting line, not a cliff
Searchers call it an exemption, but the table has no jump. Tax is $0 at exactly $1,000,000 and 10 cents on each dollar above it. The filing rule is separate: a return is required when the gross estate is $1,000,000 or more (ORS 118.160(1)(c); the Department of Revenue says the same), even when the taxable estate after debts and deductions is below $1,000,000 and nothing is owed.
Tax by estate size
All figures here are our arithmetic from the statute table. They assume the figure is the Oregon taxable estate (gross estate less debts, expenses and deductions, with the state death tax add-back), all property is in Oregon, and no credits.
| Oregon taxable estate | Oregon tax (our arithmetic) | Average rate | Top band reached |
|---|---|---|---|
| $1,000,000 | $0 | 0.00% | 10.0% |
| $1,500,000 | $50,000 | 3.33% | 10.25% |
| $2,000,000 | $101,250 | 5.06% | 10.25% |
| $3,000,000 | $205,000 | 6.83% | 10.5% |
| $5,000,000 | $425,000 | 8.50% | 11.5% |
| $7,000,000 | $667,500 | 9.54% | 13.0% |
| $10,000,000 | $1,102,500 | 11.03% | 16.0% |
| $15,000,000 | $1,902,500 | 12.68% | 16.0% |
The Department of Revenue prints one worked case that fits the formula: its 2025 instructions show a $1,430,000 taxable estate owing $43,000, which is 10% of the $430,000 above $1,000,000. Federal tax is zero below $15,000,000 for 2026 deaths, so for most estates in this table Oregon is the only estate tax that applies. Our pages on Washington and Illinois show how two other states build a bill from a higher starting line.
Rental property, fund shares and property in another state
For a resident, ORS 118.010(5) multiplies the table tax by a ratio. The numerator is Oregon real property, Oregon tangible personal property and intangible personal property; it leaves out “any intangible personal property subject to a tax imposed, as a result of the death of the decedent, by another state or country.” The denominator is the total gross estate. For a nonresident (118.010(6)) the numerator is only Oregon real and tangible property.
| Case (our arithmetic) | Gross estate | Taxable estate | Ratio | Oregon tax |
|---|---|---|---|---|
| Resident, everything in Oregon | $5,600,000 | $5,000,000 | 100% | $425,000 |
| Resident, $1,400,000 rental deeded personally in another state | $5,600,000 | $5,000,000 | 4,200,000 / 5,600,000 = 75% | $318,750 |
| Resident, same rental held through an LLC | $5,600,000 | $5,000,000 | 100% (our reading) | $425,000 |
| Nonresident, $1,400,000 Oregon rental in a $5,600,000 gross estate | $5,600,000 | $5,000,000 | 1,400,000 / 5,600,000 = 25% | $106,250 |
The Department of Revenue’s own example divides $800,000 of Oregon property by a $1,450,000 gross estate to get 55.1724% and a prorated tax of $23,724. The LLC row is our reading: an LLC or fund interest is intangible, so it stays in the numerator for a resident unless another state or country taxes it at death. Whether a pass-through that owns real estate is treated as real estate is a question for an Oregon attorney. The other state’s own tax is separate; see our guides to Pennsylvania and New Jersey inheritance tax for how a state taxes the heirs instead.
Spouses: no portability in the text, but elections exist
We found no provision in ORS 118.010, 118.013 or 118.016 that lets a survivor use a deceased spouse’s unused $1,000,000. What the law does allow is separate Oregon elections. An executor may make separate state elections under the same federal provisions, including section 2056 (QTIP), and the elections are irrevocable (118.010(8)). The Oregon special marital property election requires the executor, the surviving spouse and every permissible distributee to sign, for “the primary purpose of reducing or eliminating the Oregon estate tax” of the first estate (118.016(1)-(2)).
| Couple with $6,000,000, no growth, no deductions (our arithmetic) | Taxable estate at second death | Oregon tax at second death |
|---|---|---|
| Everything passes to the survivor | $6,000,000 | $542,500 |
| $1,000,000 to a bypass trust at the first death (taxable estate $1,000,000, tax $0), $5,000,000 to the survivor | $5,000,000 | $425,000 |
The difference is $117,500 under assumptions that rarely hold, and the trust language is for an estate-planning attorney. Our credit shelter trust and QTIP guide explains the federal side of the same design, and the step-up in basis guide covers the income tax effect on a building left to heirs.
SB 1511: what it would have done, and where it stopped
Senate Bill 1511 of the 2026 regular session was introduced at the request of the Senate Interim Committee on Finance and Revenue. The Legislature’s summary says it “converts the $1 million exclusion for an estate subject to tax to a deduction of $2.5 million.” The engrossed text is more specific, and it is not the same thing:
- A $1,000,000 deduction from the Oregon taxable estate (section 1, ORS 118.010(3)(b)(A) as amended).
- No tax if the taxable estate plus $1,000,000 is at or below a $2.5 million subject threshold, indexed to the consumer price index from August 2026.
- A phase-in: between $2.5 million and $3.0 million the tax is multiplied by a fraction that rises from zero to one.
- A new rate table running from 12.75% on the first $500,000 of the reduced estate to 19.90% above $8,500,000, and a return threshold of $2.5 million of gross estate for deaths on or after January 1, 2027.
| Oregon taxable estate (current law base) | Current law (our arithmetic) | SB 1511 as engrossed (our arithmetic) |
|---|---|---|
| $2,500,000 | $152,500 | $0 |
| $2,600,000 | $163,000 | $41,450 |
| $3,000,000 | $205,000 | $261,250 |
| $3,500,000 | $257,500 | $328,750 |
| $5,000,000 | $425,000 | $547,500 |
| $10,000,000 | $1,102,500 | $1,433,250 |
The crossover is at about $2.89 million; above it the bill’s tax is higher. A League of Women Voters of Oregon legislative report says the rates would have been “greatly increased” for the highest-valued estates, which fits our reading. The second rate table in the PDF is the new one; the printed marks that show the old table as deleted do not survive in text, so we read it against that description and not on the formatting alone.
Status. The bill passed the Senate with the -A amendments and went to the House Committee on Revenue. The Legislature’s overview page, as saved by the Internet Archive on June 10, 2026, shows its current location as “In House Committee” with no chapter number. The League of Women Voters of Oregon report says the bill “did not pass out of House Revenue by end of session.” We could not reach the Legislature’s measure-history page to see the last recorded action, so “failed” rests on those two records and on the absence of a chapter number. The bill would have applied from January 1, 2027; for a death in 2027 the current table is the one to plan on, unless the Legislature acts in a later session.
The repeal initiative: not on the November 2026 ballot
Initiative Petition 2026-051 would have nullified the estate tax and prohibited similar local taxes (certified ballot title: “Nullifies estate tax, which applies to estates of $1 million plus; prohibits similar local taxes”). The Secretary of State’s bulletin of September 30, 2025 lists it as proposed for the November 3, 2026 general election. Ballotpedia lists its status as “Not on the ballot,” and JPR’s October 9, 2026 election guide reports that “no citizen initiatives qualified for the general ballot” and lists “None on the ballot this November.” Those are secondary sources; we could not retrieve the Secretary of State’s own list of measures, so treat the ballot status as reported, not verified from the primary record.
Return, deadlines and the federal layer
| Item | Rule | Source |
|---|---|---|
| Who files | Executor, when the gross estate at death is $1,000,000 or more | ORS 118.160(1)(c); Form OR-706 instructions |
| Form | Form OR-706 for deaths on or after January 1, 2012 | Form OR-706 instructions |
| When | Return filed and tax paid within 12 months after death | ORS 118.100(1) |
| Extension to pay | Up to 14 years from the due date, with security | ORS 118.225(2) |
| Penalty | 5% of the tax; 20% more if the return is over three months late | ORS 118.260(1)-(2) |
| Interest | 8% a year for periods beginning January 1, 2026; 9% for 2025 | Form OR-706 instructions |
A filing extension does not by itself extend the time to pay, so confirm that in the current instructions. On a $425,000 tax, a year of interest at 8% is about $34,000 (our arithmetic).
What a reader can do with this
What you can check before talking to anyone:
- Find the taxable estate. Add the home, rentals, fund and LLC interests, retirement accounts, life insurance you own and cash, take off debts, expenses and marital or charitable gifts, and read the table.
- List what sits in another state and how it is titled: a deed carves it out of the Oregon numerator; an LLC interest does not.
- Compare the bill with the cash. The tax is due 12 months after death; a building or a fund interest may take longer than that to sell or redeem.
- Check a couple’s documents. If everything passes to the survivor, the first $1,000,000 can be wasted.
The decision, and who makes it. The estate plan is drafted by an estate-planning attorney, the Oregon and federal returns are prepared by that attorney or a CPA, and appraisals come from credentialed appraisers. A financial adviser’s part is how the tax would be paid. Nothing here is a recommendation to change a plan. Our probate guide covers the process that runs alongside.
This is analysis of public documents, not investment, legal or tax advice.
FAQ
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When a rate, rule or filing behind this page changes: what changed, the one number that matters, and the source to check it yourself.
Sources, read and saved on October 21, 2026: ORS 118.007, 118.010, 118.013, 118.016, 118.100, 118.160, 118.225 and 118.260 (oregon.public.law mirror of the Oregon Revised Statutes, current through the 2024 session); Oregon Department of Revenue, 2025 Form OR-706 Instructions (rev. 07-22-25); Senate Bill 1511, A-Engrossed, 83rd Oregon Legislative Assembly, 2026 Regular Session, and the OLIS overview page (Internet Archive capture of June 10, 2026); League of Women Voters of Oregon legislative report, week of March 9, 2026; Oregon Secretary of State bulletin on the certified ballot title of Initiative Petition 2026-051 (September 30, 2025); Ballotpedia, Oregon Repeal Estate Tax Initiative (2026); JPR, Election 2026: What to know in Oregon (October 9, 2026). The grids, ratios and the comparison with SB 1511 are our arithmetic, with the assumptions stated. This is analysis of public documents, not investment, legal or tax advice.
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