Oregon Advances Plan to Ease Estate Taxes for Most Families While Increasing Rates on Multi-Million Dollar Estates
Oregon Democrats advanced a plan in the Senate on Wednesday to raise the estate tax threshold from $1 million to $2.5 million and increase taxes on estates above $3 million.
Oregon Plan To Move Estate Tax Burden To Wealthier Estates
Because of Oregon’s estate tax threshold of $1 million, set in 2011, it’s become increasingly common for the tax to be triggered, given that Inflation in the U.S. has increased by approximately 44% to 48% between 2010 and 2025, as home prices in the Portland and Bend areas have soared.
Introduced by Senate Revenue Committee Chair Anthony Broadman, the proposal aims to increase the threshold by $1.5 million for the estates of Oregonians who die in 2027 and thereafter, and to peg it to inflation from 2028.
Source: Oregon Legislature SB 1511 amendments / IRS inflation adjustments for 2026 / SSA CPI W table
Dailytidings.com
To collect roughly the same amount of estate taxes through at least 2029, Oregon Senate Democrats propose raising taxes on estates worth more than about $3 million while raising the existing threshold of $1 million.
Estates worth less than $1.8 million are not taxed in any other state, and federal estate taxes only apply to estates worth at least $15 million.
The top marginal rates on estates worth above $8.5 million currently range from 12% to 15% but would rise by 4.25 percentage points. The top marginal tax rate would increase by 3.9 percentage points, to 19.9%.
Both Republicans on the five-member committee voted against the plan as a whole, but the bill now heads to the Senate.
Oregon Estate Taxes Apply To Some Nonresidents
Estate taxes are levied even if someone moves out of Oregon. Their estate can still owe Oregon estate tax if they die owning Oregon real property (such as a vacation home); relocating doesn’t necessarily make the tax disappear.
| Situation | Oregon estate tax can apply | What triggers it |
|---|---|---|
| Oregon resident dies with a gross estate at or above $1,000,000 | Yes | Oregon filing threshold is based on gross estate value |
| Nonresident dies but owned Oregon real property | Yes | Oregon situs property can make the estate subject to Oregon tax |
| Moved out of Oregon but kept an Oregon vacation home | Often yes | Nonresident rule still applies if Oregon real property is owned at death |
For example, the Oregon Department of Revenue (ODR) website indicates that if the decedent’s estate is valued at $1 million or more, whether they were an Oregon resident or a nonresident, the estate is still subject to taxes in Oregon if the person had real property or tangible personal property located in the state.
Under ORS 118.010, a tax is imposed on a nonresident decedent, domiciled outside of Oregon on the date the individual dies, whose estate includes any interest in real property or tangible personal property located in Oregon. The tax is calculated by applying the rates in the ODR table.