Updated Feb. 14, 2023 to reflect a new waiver for penalties and interest for tax year 2021.
Multnomah County voters approved the new tax on Nov. 3, 2020, to establish a tuition-free preschool program for 3- and 4-year-olds. It funds high-quality, developmentally appropriate, culturally responsive preschool experiences. The tax went into effect Jan. 1, 2021.
Most area residents do not owe these taxes because they apply to higher incomes. The Preschool for All tax is 1.5% on taxable income over $125,000 for individuals and $200,000 for joint filers, and an additional 1.5% on taxable income over $250,000 for individuals and $400,000 for joint filers. The rate will increase by 0.8% in 2026.
On Feb. 14, 2023, Chair Jessica Vega Pederson announced those who do owe the tax will pay no interest or penalties for the 2021 tax year regardless of individual circumstances. Those who already paid penalties and interest can obtain a refund.
Taxpayers who were required to make quarterly payments in tax year 2022 (taxpayers who owe more than $1,000 in tax for the year), will have their interest for quarterly underpayments waived for tax year 2022 only. All other penalties and interest associated with tax year 2022 and beyond will remain in effect.
It’s important to note that the County is advising everyone with tax liability not to wait to submit their 2021 and 2022 returns. The County also reserves the right to reassess 2021 penalties and interest for those who continue to not file their return or otherwise attempt to evade Preschool for All personal income tax liability after notification.
2022 taxes are due April 18, 2023.
Residents of Multnomah County will have 100% of their Oregon Taxable Income subject to the tax thresholds. For non-residents of Multnomah County, income sourced within the County will be subject to the tax thresholds. Please refer to our FAQ for further clarification.
Multnomah County employers are required to withhold on behalf of employees for the Preschool For All Personal Income Tax. Employers were required to offer in writing to withhold for employees as soon as their payroll system was capable in 2021. Withholding is mandatory in 2022. Employers should automatically withhold for employees making over $200,000 per year. Employees may elect to opt in or out of withholding based on their individual tax situation.
The City of Portland Revenue Division is collecting the tax on behalf of Multnomah County for the Preschool For All Personal Income Tax. All payment and filings should be sent to the City of Portland through their Portland Revenue Online (PRO) system. The system has been ready for remittance of the Preschool For All Personal Income Tax since April 1, 2021. https://pro.portland.gov/_/. You do not need to create a username or login to file.
For questions about the Preschool For All Personal Income Tax administration, please contact the tax administrator at the City of Portland Revenue Division: (503) 865-4748 or email PFA.Tax@portlandoregon.gov for more information.
Reminder Notice: Only Oregon Taxable Income is subject to the tax thresholds. Income such as PERS, Social Security, etc. are not taxable in Oregon and therefore NOT subject to the PFA tax thresholds.
