Instructions for Form C-2025

Revised 12/15/2025

General Information

Important Reminders

Note: S corporations should file SC-2025.

File and Pay Online and Manage your Business Tax Accounts at Pro.Portland.gov. The Revenue Division's taxpayer portal can be used to manage your business tax accounts. Portland Revenue Online (PRO) allows you to:

• Register your business
• Update your business account information
• File a Business Tax Return
• Make payments
• Upload supporting tax pages and documents
• View correspondence mailed to you
• Provide Third-Party Access to your preparer

For more information and to create your account, please visit Pro.Portland.gov.

Filing Deadline

The filing deadline for this return is April 15, 2026. Since Form C-2025 relies on information reported on the federal and Oregon tax return, the due date for Form C-2025 will be changed when there is a change to the federal or State of Oregon due dates.

Extensions

The Revenue Division does not generally allow an extension of time to pay the tax, even if the IRS allows an extension. The tax balance is due on the original return due date. The submission of an extension payment by the original return due date provides an automatic six-month filing extension. If there is not a tax balance due but you would like to file an extension, your federal or State of Oregon extension will serve as your Business Tax extension and a separate extension will not need to be submitted. When filing your return on the extended due date, check the "Extension Filed" box on the return. If no extension payment was made, please attach a copy of your federal or State of Oregon extension with your return.

Federal and State Tax Pages

Be sure to include the following federal tax pages (and statements), Oregon tax pages (and statements), and Portland schedules with your C-2025 Business Tax Return:

• Oregon Form OR-20 or OR-20-INC (including OR-AP, OR-ASC, OR-24 and any other Oregon forms and schedules you have filed) with statements
• Federal Form 1120 (pages 1 through 5) with statements
• Federal Form 1125-E and statements (if filed)
• HVT Schedule, if required (Portland form)
• PRS Schedule, if required (Portland form)
• Schedule R, if required (Portland form)

The Revenue Division has the authority to request additional tax pages or supporting documentation to verify the accuracy of the tax reported on the tax return.

Market Based Sourcing

For tax years beginning on or after January 1, 2023, the City of Portland and Multnomah County have adopted the Market Based Sourcing (MBS) and single sales factor apportionment methodology to conform with the State of Oregon's apportionment methodology. This change includes adoption of the state's nexus standards and the interstate application of federal Public Law 86-272.

What's New?

Increase to Owner's Compensation Deduction

For tax years beginning on or after January 1, 2025, the maximum owner's compensation deduction has increased to $160,500, per owner, for the City of Portland Business License Tax.

For tax years beginning on or after January 1, 2025, the maximum owner's compensation deduction has increased to $158,500, per owner, for the Multnomah County Business Income Tax.

Amended Returns

The Revenue Division does not have a separate form for amended tax returns. To amend your Business Tax Return, use the form for the tax year being amended and check the "Amended" box. If the address for the year you're amending has changed, use your current mailing address and check the "Mailing Address Change" box.

Fill in all amounts on your amended return, even if they are the same as originally filed. If you are amending to make a change to additions, subtractions, or credits, include detail of all items and amounts as well as any carryovers. Please include a statement explaining what changed from the original return.

If you change taxable income by filing an original or amended federal or Oregon income tax return, you must file an amended Business Tax Return within 60 days of when the original or amended federal or Oregon income tax return is filed. Include a copy of your original or amended federal or Oregon income tax return with your amended Business Tax Return and explain the adjustments made.

Do not amend your Business Tax Return if you amend the federal return to carry a net operating loss back to prior years. The Revenue Division only allows tax entities to carry net operating losses forward. Additionally, net operating losses for the City of Portland Business License Tax and/or Multnomah County Business Income Tax are only generated from the Business Tax Return, not from your IRS or Oregon income tax return.

On the prepayments line of your amended Business Tax Return, enter the net tax for each jurisdiction as reflected on the original return or as previously adjusted. Do not include any penalty or interest portions of payments already made.

Apportionment

In adopting Oregon's apportionment law, both jurisdictions (Multnomah County and City of Portland) use Oregon's single sales factor to apportion business income to or away from the jurisdictions. Sales are all gross receipts not allocated under ORS 314.615 to 314.645 that are received from transactions and activity in the regular course of business except as excluded by ORS 314.610(7), the related statutes, and related rules. Refer to Oregon's statutes and rules for guidance. Substitute city/Portland or county/Multnomah County for state/Oregon as needed.

Income may be apportioned only if there is regular business activity both inside and outside these jurisdictions that would allow a similar tax to be imposed on income earned outside Multnomah County and Portland. The ability to apportion income is determined separately for these jurisdictions. With a few exceptions, income earned in Portland is also earned in Multnomah County.

Exempt Businesses

If your business is exempt from the City of Portland Business License Tax, as allowed under Portland City Code (PCC) 7.02.400 or the Multnomah County Business Income Tax, as allowed under Multnomah County Code (MCC) 12.400, you are still required to file a Business Tax Return by the due date of your return. Failure to do so may result in a Presumptive Fee bill and your account will remain in non-compliance status until the required documentation is received.

This exemption is from the business taxes only. Any other tax, surcharge, or fee may fall under separate exemption criteria, for which your business may still be liable.

Gross Receipts Exemption

Note: The following amounts are taken from the federal income tax return.

To claim a gross receipts exemption from the City of Portland Business License Tax and/or the Multnomah County Business Income Tax, the total gross receipts from all business activity must be under:

• $50,000 for the City of Portland Business License Tax exemption, and
• $100,000 for the Multnomah County Business Income Tax exemption.

To calculate the total gross receipts from all business activity, add the following lines together:

• Form 1120. Add the sum of positive numbers reported on line 1c and 4 through 10 on page 1 of Form 1120. If the corporation owns any residential rental properties in the City of Portland, make sure to complete and submit a Schedule R (with payment) with your exemption request.

If your total gross receipts from all business activity are $50,000 or more, you do not qualify for the gross receipts exemption for the City of Portland Business License Tax.

If your total gross receipts from all business activity are $100,000 or more, you do not qualify for the gross receipts exemption for the Multnomah County Business Income Tax.

Other Exemptions

If you are claiming an exemption other than the gross receipts exemption, you must attach a statement that explains which exemption you are claiming and provide support for that exemption (See Exemption Codes in the Appendix).

Penalty Calculation

Penalties will be assessed in the following order as applicable:

1. Late payment/filing penalty for filing/paying after the original due date (up to 25% of the total tax liability)
2. Late payment/filing penalty for filing/paying after the extended due date (up to 25% of the total tax liability)
3. Underpayment penalty (5% of underpaid tax)

Although there is a late penalty for both failing to file a Business Tax Return and failing to pay the total tax liability by the original due date of the return, only one of these penalties will be applied if there is a failure of both requirements by the original due date. You may be assessed both a late payment penalty and a late filing penalty if you request a filing extension and fail to file by the extension due date.

See Portland City Code (PCC) 7.02.700 Penalties for more information.

Underpayment Penalty

You may be subject to a penalty for underpaying your tax liability if, by the original due date of the return, timely payments are not made which are either:

• At least 90% of the total tax/fees due on line 21 (Multnomah County) and line 36 (City of Portland), or
• 100% of the prior year's tax for each jurisdiction.

If you did not satisfy either requirement, you will be charged a 5% underpayment penalty on the unpaid amount, but not less than $5 per jurisdiction.

Late Filing Penalty

If you do not file your Business Tax Return by the original due date, file an extension with the Revenue Division by the original due date, or include a copy of your federal or state extension with your Business Tax Return when you file by the extended due date, the following late filing penalties will apply:

• 5% of the amount of the total tax liability if the failure to file is for a period less than four months.
• An additional penalty of 20% of the total tax liability must be added if the Business Tax Return is four months or more past due.
• An additional penalty of 100% of the total tax liability of all tax years for any Business Tax Return which is delinquent for three or more consecutive years.

No late filing penalty is due if a timely extension is filed with the Revenue Division and a Business Tax Return is filed by the extended due date, or a copy of the federal or state extension is included with the Business Tax Return and the ‘Extension Filed' box is checked.

Late Payment Penalty

Your 2025 business tax must be paid by April 15, 2026, even if you requested an extension to file your Business Tax Return. If you do not pay your tax by the original due date, the following late payment penalties will apply:

• 5% of the amount of the tax that was not paid by the original due date.
• An additional penalty of 20% of the unpaid tax must be added if the failure to pay is for a period of four months or more.
• An additional penalty of 100% of the unpaid tax liability of all tax years if the failure to pay is for three or more consecutive years.

Interest Calculation

Late Payment Interest

Interest is calculated at 10% per annum (.00833 multiplied by the number of months). Calculate your interest from the original due date to the 15^th day of the month following the date of the payment.

Quarterly Underpayment Interest

Quarterly underpayment interest will be due if estimated payments were required and were underpaid. Calculate your quarterly underpayment interest at a rate of 10% per annum from the due date of each quarterly estimated payment to the original due date of the tax return to which the estimated payments apply.

The amount of underpayment is determined by comparing the 90% of the current total tax liability amount to quarterly estimated payments made prior to the original due date of the tax return.

There is no interest on underpayment of quarterly estimated payments if:

• The total tax liability of the prior tax year was less than $1,000 for the jurisdiction;
• An amount equal to at least 90% of the total tax liability for the current tax year was paid in accordance with PCC 7.02.530 and/or MCC 12.530; or
• An amount equal to at least 100% of the prior year's total tax liability was paid in accordance with PCC 7.02.530 and/or MCC 12.530.

C Corporation Business Tax Return Filing Instructions

Rounding. Round cents to whole dollars on your return and schedules. To round, drop amounts under 50 cents and increase amounts from 50 to 99 cents to the next dollar. For example, $1.39 becomes $1 and $2.50 becomes $3. If two or more amounts must be added to figure the amount to enter on a line, include cents when adding the amounts and round off only the total.

General Return Information

Tax Year. Enter the beginning and ending dates of your tax year. For calendar year filers, this would be 01/01/2025 to 12/31/2025.

Account #. Enter your BZT account number (ten digits). This information can be found on letters the Revenue Division has mailed to you related to your business tax account. If you can't find your account number, call the Revenue Division at (503) 823-5157.

FEIN. Enter the Federal Employer Identification Number (FEIN) of the entity filing with the Oregon Department of Revenue.

NAICS. Enter the NAICS (North American Industry Classification System) code for your business.

Entity Filing in Oregon. Enter the legal name of the entity filing with the Oregon Department of Revenue. If you have merged or reorganized, enter the new filing entity's name and check the box that the entity has merged or reorganized.

Mailing Address. Always enter your current mailing address. If the address for the year you are filing has changed, check the box indicating the change.

Name of Parent Corporation, if Applicable. If you file under a different entity for the Oregon Department of Revenue than the IRS, please enter the name of the parent corporation here.

FEIN of Parent Corporation. If you file under a different entity for the Oregon Department of Revenue, please enter the FEIN of the parent corporation here.

If Merged/Reorganized, Enter Name of Previous Business. If you have checked the Merged/Reorganized box in the Entity Filing in Oregon field, enter the name of the previous business here.

FEIN of Previous Business. If you have checked the Merged/Reorganized box in the Entity Filing in Oregon field, enter the FEIN of the previous business here.

Initial Return Box. Check this box if this is your first return you are filing with us. Attach the Business Tax Registration Form, if not mailed to us previously.

Final Return Box. Check this box if you no longer conduct business in the City of Portland and/or Multnomah County and this is the final return you are filing with us. Attach an Out of Business Notification Form or an explanation for your final return. If you have sold your business, indicate the name and address of the entity you sold your business to.

Amended Return Box. Check this box if you are amending your 2025 tax return. See the Amended Returns section under "General Information" for more information about amending your Business Tax Return.

Extension Filed Box. Check this box if you filed an extension to file your federal or state income taxes. Attach a copy of your federal or State of Oregon extension to your Business Tax Return.

Part I – Sales and Exemption

Line 1. Multnomah County sales. Multnomah County sales means "sales" as defined in Oregon statute and administrative rules, and includes gross receipts from all business activity within Multnomah County (see Apportionment instructions).

Line 2. Total sales from all sources in all locations. Total sales means "sales" as defined in Oregon statute and administrative rules, and includes gross receipts from all business activity everywhere, as reported on your federal Form 1120.

Line 3. Multnomah County apportionment percentage. Line 1 divided by line 2. Round to 6 decimal places. This line cannot be more than 1.0.

Line 4. City of Portland sales. Portland sales means "sales" as defined in Oregon statute and administrative rules, and includes gross receipts from all business activity within the City of Portland (see Apportionment instructions).

Line 5. Total sales from all sources in all locations. Total sales means "sales" as defined in Oregon statute and administrative rules, and includes gross receipts from all business activity everywhere, as reported on your federal Form 1120. Generally, this should be the same as the sales reported on line 2, but there are rare situations where this amount may be different.

Line 6. City of Portland apportionment percentage. Line 4 divided by line 5. Round to 6 decimal places. This line cannot be more than 1.0.

Exempt – Multnomah County. Check this box if you are claiming an exemption from the Multnomah County Business Income Tax and select a reason for the exemption. If your reason for being exempt is other than for gross receipts, attach a statement explaining which exemption you are claiming and provide support for that exemption (See Exemption Codes in the Appendix).

Exempt – City of Portland. Check this box if you are claiming an exemption from the City of Portland Business License Tax and select a reason for the exemption. If your reason for being exempt is other than for gross receipts, attach a statement explaining which exemption you are claiming and provide support for that exemption (See Exemption Codes in the Appendix).

NOTE: If you have claimed an exemption from the Multnomah County and the City of Portland business taxes, you generally don't need to fill out the following parts of the return:

• Part II – Net Income
• Part III – Multnomah County Business Income Tax (if claiming an exemption from Multnomah County Business Income Tax)
• Part IV – City of Portland Business License Tax (If claiming an exemption from the City of Portland Business License Tax)

However, even if you are exempt from the City of Portland Business License Tax, you are still liable for any Heavy Vehicle Use Tax or Residential Rental Registration fees that may be due. If you are subject to either tax/fee, please complete line 33 (Heavy Vehicle Use Tax) and/or line 35 (Residential Rental Registration Fee) and attach the required schedule(s) with your Business Tax Return. Be sure to include any payment due for these taxes/fees, or you will be subject to late payment penalties and interest on the unpaid balance.

If you have made estimated prepayments and would like them refunded to you or credited to the next tax year, fill out the prepayment section(s) of the return to tell us how you would like your overpayment applied in Part V – Tax Due / Refund.

Part II – Net Income

Line 7. Net income or (loss). Net income or loss is the net income before apportionment reported on Oregon Form OR-20 or OR-20-INC. Enter the net income reported on Oregon Form OR-20 or OR-20-INC, line 5.

Line 8. Taxes based on or measured by net income add-back. Add back any taxes based on or measured by net income, including the City of Portland Business License Tax, Multnomah County Business Income Tax, and Metro Business Income Tax, that have been deducted to arrive at the net income reported on line 7.

Line 9. Owner's compensation add-back. Enter the number of controlling shareholders. Enter any compensation paid to controlling shareholders (individuals or families who together hold more than 5% of the stock). This includes wages, commissions, and salaries (current and deferred).

See Business Tax Administrative Rule (BTAR) 600-93.9A - Definition of Controlling Shareholders and Calculation of Number of Controlling Shareholders for additional guidance.

Line 10. Other additions or subtractions. Add or subtract any Oregon modifications related to business income. Subtract any pass-through income (or add any loss) from entities already taxed by Portland and Multnomah County. Attach a schedule for these modifications.

Line 11. Adjusted net income. Sum of lines 7 through 10.

Part III – Multnomah County Business Income Tax

Line 12. Multnomah County modifications. Enter any modifications to Multnomah County's adjusted net income here. Multnomah County allows a subtraction for federal obligation interest taxed in Oregon, enter that amount as a subtraction here if included on line 11. Non-business income may be income or a loss. Remove any non-business income or loss reported in adjusted net income (line 11). Removal of income will be a subtraction while removal of a loss will be an addition.

Line 13. Multnomah County net business income. Sum of line 11 and line 12.

Line 14. Owner's compensation deduction. A deduction from net business income (line 13) is limited to the lesser of:

• The compensation reported on line 9,
• 75% of the amount on line 13, or
• The number of controlling shareholders multiplied by $158,500 for the County.

No deduction is allowed if line 13 is a loss.

Line 15. Multnomah County subject net income. Sum of line 13 and line 14.

Line 16. Multnomah County apportioned net income. Line 15 multiplied by line 3. 

Line 17. Add-back of non-business income or loss allocated to Multnomah County. Return any non-business income or loss removed above on line 12 that should be allocated to Multnomah County.

Line 18. Total business income taxable to Multnomah County. Sum of line 16 and line 17.

Line 19. Net operating loss deduction. Enter your net operating loss (NOL) from previous years as a negative number here. NOLs are allowed only if reported on prior Business Tax Returns. This deduction cannot be greater than 75% of line 18. Any unused NOL may only be carried forward for five years. If your NOL from previous years is due to a merger, reorganization, or acquisition allowed by tax administration policy, attach a statement which details the source of the NOL. See Tax Administration Policy - Net Operating Loss Carryforwards Disallowance and Allowance for Entity Changes for more information.

Line 20. Income subject to tax. Sum of line 18 and line 19.

Line 21. Multnomah County Business Income Tax. Line 20 multiplied by the tax rate of 2%. The minimum amount of tax owed is $100.

Part IV – City of Portland Business License Tax

Line 22. City of Portland modifications. Enter any modifications to City of Portland's adjusted net income here. This would generally apply only in rare circumstances. Non-business income may be income or a loss. Remove any non-business income or loss reported in adjusted net income (line 11). Removal of income will be a subtraction while removal of a loss will be an addition.

Line 23. City of Portland net business income. Sum of line 11 and line 22.

Line 24. Owner's compensation deduction. A deduction from net business income (line 23) is limited to the lesser of:

• The compensation reported on line 9,
• 75% of the amount on line 23, or
• The number of controlling shareholders multiplied by $160,500 for the City.

No deduction is allowed if line 23 is a loss.

Line 25. City of Portland subject net income. Sum of line 23 and line 24.

Line 26. City of Portland apportioned net income. Line 25 multiplied by line 6. 

Line 27. Add-back of non-business income or loss allocated to City of Portland. Return any non-business income or loss removed above on line 22 that should be allocated to the City of Portland.

Line 28. Total business income taxable to City of Portland. Sum of line 26 and line 27.

Line 29. Net operating loss deduction. Enter your NOL from previous years as a negative number here. NOLs are allowed only if reported on prior Business Tax Returns. This deduction cannot be greater than 75% of line 28. Any unused NOL may only be carried forward for five tax years.

Line 30. Income subject to tax. Sum of line 28 and line 29.

Line 31. City of Portland Business License Tax. Line 30 multiplied by the tax rate of 2.6%. The minimum amount of tax owed is $100.

Line 32. Downtown Business Incentive Credit. Claim 25% of your total calculated Downtown Business Incentive Credit on this return. The amount of claimed credit cannot exceed the amount of City of Portland Business License Tax on line 31. 

Do not claim any credit if you did not apply and receive an approval letter from the Revenue Division.

Line 33. Heavy Vehicle Use Tax (HVT). If you are subject to Portland's Heavy Vehicle Use Tax, enter the amount from line 4 of the HVT Schedule here.

Line 34. Pay Ratio Surtax. If you are subject to the City of Portland's Pay Ratio Surtax, enter the amount due from the PRS Schedule here.

Line 35. Residential Rental Registration Fee. If you are subject to Portland's Residential Registration Fee, enter the amount due from Schedule R here.

Line 36. Total of City of Portland taxes and fees. Sum of lines 31 through 35.

Part V – Tax Due / Refund

Line 37. Total business taxes and fees. Sum of lines 19 and 36.

Line 38. Late payment or late filing penalty. Enter the amount of any late payment of taxes or late filing penalty owed.

Line 39. Underpayment penalty. Enter the amount of any underpayment penalty owed.

Line 40. Interest. Enter any quarterly underpayment interest and/or interest due on taxes not paid by their due dates.

Line 41. Quarterly estimated payments and other prepayments. Enter the total amount of prepayments as a negative number here. This includes all quarterly estimated payments, extension payments, and any credits carried forward from prior years.

Line 42. Business Retention Credit. Enter the amount of Business Retention Credit being claimed on the tax return as a negative number here. Please attach Form BRC showing your calculations.

Line 43. Overpayment. If the sum of lines 37 through 42 is negative, this is the amount you have overpaid. If you have an overpayment, you may make an irrevocable choice to have the balance:

• Refunded to you, or
• Applied as an estimated tax payment to the next open tax year.

If no election is made, any overpayment will be refunded to you.

Line 44a. Refund. Enter the amount of the overpayment you would like refunded to you on this line. If you would like direct deposit of your refund, please file your Business Tax Return online at Pro.Portland.gov. If your return is filed on paper, you will receive your refund in the mail by check. This election is irrevocable.

Line 44b. Apply as an estimated tax payment. Enter the amount of the overpayment you would like to apply as an estimated payment to the next open tax year on this line. This election is irrevocable.

Line 45. Combined amount due with report. If the sum of lines 37 through 42 is positive, you have a balance due.

Make your check payable to ‘City of Portland' and submit with your Business Tax Return. For fastest payment processing, pay online by logging into your PRO account at Pro.Portland.gov.

Part VI – Signature

Signature. An authorized representative of the business must sign and date the return and provide a contact email address and phone number. By signing the return, you acknowledge, under penalty of false swearing, that the information on the return is true, correct, and complete. By claiming the Downtown Business Incentive (DBI) Credit, you agree to a waiver of the statute of limitations for any year where the credit is claimed, per administrative rule. This waiver will only apply to the DBI Credit and will not apply to other tax assessments or refunds.

Preparer Signature. Anyone who prepares, advises, or assists in preparing business income tax returns in exchange for compensation of any kind must be licensed to prepare Oregon returns and must sign the return.

Mailing Instructions

Mail your completed return and all required supporting tax pages in the same envelope to:

Revenue Division
111 SW Columbia St. Suite 600
Portland, OR 97201-5840

Appendix

Exemption Codes

If you are claiming an exemption from the City of Portland Business License Tax and/or Multnomah County Business Income Tax, please use one of the following exemption codes:

Business Tax Codes, Administrative Rules, and Policies

• City of Portland Business License Law
• Multnomah County Business Income Tax Code
• Business Tax Administrative Rules
• Business Tax Administration Policies