Information about the requirements for filing your business tax returns and paying your business taxes with the City of Portland's Revenue Division.
Taxfilers must file a Combined Tax Return at the same time they file their federal & state income tax returns (generally, April 15th for calendar year taxfilers).
Exempt taxfilers must also file a Combined Tax Return with their supporting tax pages.
If a taxfiler qualifies for one or more of the exemptions from the City of Portland Business License Tax and/or Multnomah County Business Income Tax, they must file a request for exemption each year and provide supporting tax pages.
Certain taxfilers are exempt under the City of Portland and Multnomah County Business Income Tax codes, Administrative Rules, and Policies. These exemptions include:
- Gross business income less than $50,000 from all business receipts everywhere.
- For tax years beginning on or after January 1, 2020, gross business income less than $100,000 from all business receipts everywhere may qualify to be exempt from Multnomah County Business Income Tax only.
- Real estate brokers working under the supervision of a primary broker.
- Individuals whose only income is:
- Gain on sale of primary residence,
- Gain on sale of personal property acquired for personal or household use, and/or
- Investment earnings (if not part of a business).
- Corporations exempt from the Oregon Corporation Excise Tax under ORS 317.080 (generally not-for-profit corporations).
- Trusts exempt from Federal income tax under IRC § 501.
- Persons whose only business activity is raising or harvesting the person's own crops or livestock.
- Persons who operate a display booth in a permanent structure for less than 14 days in a tax year. These circumstances require a Temporary Business License.
What if a taxfiler is exempt but doesn't file?
The Revenue Division will send them a notice requesting them to file a return. If the taxfiler does not file their Combined Tax Return, Civil Penalties will be assessed and collection activities will begin.
Requesting an Extension to File
If a taxfiler cannot complete their Combined Tax Return by the original due date, they may request a six-month extension to file their Combined Tax Return. This extension should be accompanied by a payment of the estimated tax due, if applicable. This is an extension to file only. There is no extension to pay the business taxes.
Due dates for tax returns and extensions are based on fiscal year end of the taxfiler.
|Fiscal Year End||Tax Return Due Date||Extension Due Date|
|December 31 (calendar year end)||April 15||October 15|
|February 28 / 29||June 15||December 15|
|March 31||July 15||January 15|
|April 30||August 15||February 15|
|May 31||September 15||March 15|
|June 30||October 15||April 15|
|July 31||November 15||May 15|
|August 31||December 15||June 15|
|September 30||January 15||July 15|
|October 31||February 15||August 15|
|November 30||January 15||September 15|
Federal or state tax extensions are accepted. If a taxfiler has requested an extension to file with the IRS or State of Oregon, they must attach their federal/state extension to their Combined Tax Return when they file and check the "Federal Extension" box. All business taxes must still be paid by the original due date. Late payment penalties will be applied to any tax due that is not paid by the original due date.
Tax Entity Changes
Existing businesses that have changed their tax entity (for example, a sole proprietor who has incorporated into an S corporation) need to register the new tax entity and get a new business tax account number.
Closed or Sold Businesses
When a business is sold, closed, or no longer operates within the City of Portland and/or Multnomah County, they should notify the Revenue Division to close their business tax account. When a business tax account is closed, a taxfiler should:
- File a Combined Tax Return for the final year the business operated in the City and/or County.
- Complete the Out of Business form and attach it (or a statement with the same information) to the Combined Tax Return. Make sure to provide:
- The new owner's name and address (if the business or property has been sold)
- Whether you ceased all business activity or only activity in the City of Portland and/or Multnomah County
Don't close the business tax account if:
- There is contract (installment) sales from the sale of the business. This income is considered continuing business income and will require annual filings.
- A taxfiler owns real property and intends to rent or lease it to others.
Quarterly Estimated Payments
Quarterly estimated payments are required for the City of Portland and Multnomah County if the current tax liability for either tax program will be $1,000 or greater, and the taxfiler's prior year tax liability for that tax program was also $1,000 or greater.
Each quarterly estimated payment should equal 25% (or more) of the current year's estimated tax liability.
For calendar year files, quarterly estimated payments are due on:
- April 15
- June 15
- September 15
- December 15*
For fiscal year filers, quarterly estimated payments are due on:
- The 15th day of the 4th month of the tax year
- The 15th day of the 6th month of the tax year
- The 15th day of the 9th month of the tax year
- The 15th day of the 12th month of the tax year*
*Please note, the fourth quarterly estimated payment due date is one month earlier than the January 15 due date of the federal and Oregon quarterly estimated payments for individuals.
A taxpayer will be subject to quarterly underpayment interest if they are required to make quarterly estimated payments and by the due date of the 4th quarter payment have not made four quarterly estimated payments that equal:
- 100% of the prior year liability, or
- 90% of the current year liability
Interest on these underpayments is calculated at an annual rate of 10% for each quarter that payments are late or less than the amount due.
The Revenue Division recognizes that at times it may not be possible for a taxpayer to pay their tax liability in full. To encourage payment of all amounts due, the Revenue Division will consider entering into a payment plan agreement to ensure collection. Taxpayers are not eligible for a payment plan if the taxpayer fits into one of the following categories:
- The taxpayer has defaulted on a payment plan with the revenue Division within the last 2 years.
- The taxpayer has been referred to the City Attorney for legal action. They must enter into a confession of judgment instead.
A payment plan may be approved when the taxpayer has no other method of financing this debt (such as a credit card cash advances, home equity loan proceeds, business loans, etc.) The taxpayer must remain in compliance with City and County tax codes during the term of the payment plan.
Payment Plan Requirements
Generally, there is a $25 set up fee for a payment plan. The Revenue Division may discuss payment plan options and give approval to the taxpayer, provided the options meet the criteria established below.
- If you can pay the full amount you owe within 12 months, you can avoid paying the fee to set up the payment plan agreement.
- If a payment plan agreement of more than 24 months is needed, the set-up fee increases to $50 and supervisor approval is needed.
If terms outside these are requested, Revenue Division management will review the proposed alternate terms on a case by case basis.
The payment plan due date is the 10th or the 25th of the month, at least 16 days after the date the payment plan was set up. Interest continues to accrue during the repayment period.
All payments must be made by the due date. Failure to pay any installment of the payment plan by the due date will result in the payment plan being considered in default and any outstanding balance will become immediately payable.
Payments not received within five (5) business days after the due date will be considered late. The Revenue Division will allow one late payment. A second late payment will cause the entire outstanding balance to become immediately due and any penalty waiver granted under the Revenue Division’s penalty assessment policy would be immediately reinstated to the outstanding balance.
If payment for taxes due nor a protest to increased taxes is timely received, the Revenue Division may assess additional interest and penalties, including civil penalties of $500 per violation of the City and County tax codes. The Revenue Division may also begin collection activity for the balance due for your account.
If the Revenue Division refers your account to a third-party collection agency, additional fees up to 25% of the total balance due may be added to your debt, and you must contact the collection agency about your debt.
If the Revenue Division refers your account to the City Attorney's office, additional court or legal fees may be added to your debt.
Refunds for the City of Portland and Multnomah County business taxes are generally issued within 8-10 weeks after the complete Combined Tax Return (with supporting tax pages) is filed. Due to high volumes of mail, Combined Tax Returns filed in March/April and September/October may require additional time for a refund to be issued.
Refunds will be issued only in the event of overpayment, duplicate payments, or a payment made when no tax was due. All requests for refund must be made in writing.
An online payment made Monday through Friday may be voided on the same day it is made by canceling the payment before 4 pm Pacific Time.
Multnomah County Business Income Tax Changes for TY2020
March 27, 2020
Dear Tax filer:
Thank you for choosing to do business in Multnomah County. With support from businesses like you that pay the Business Income Tax (BIT), the County is able to deliver services that support the social and health services, public safety, and wellbeing of our community and make Multnomah County one of the nation’s most attractive places to live, work, and conduct business.
The purpose of this letter is to notify you that the Board of County Commissioners voted unanimously on March 19, 2020, to make three changes to the County’s BIT code. For tax years beginning on or after January 1, 2020, Multnomah County will: increase the tax rate for the BIT from 1.45% to 2.00%; increase the gross receipts exemption from less than $50,000 to less than $100,000; and increase the maximum owner’s compensation deduction from $108,000 to $127,000.
For tax year 2020, taxpayers making estimated quarterly payments can continue to avoid being assessed quarterly interest by paying 100% of the prior year’s BIT liability. Taxpayers may also avoid quarterly interest by paying 90% of the total current tax year’s BIT liability by the original due date for that BIT return. If a taxpayer would have met the 90% threshold under the prior year’s rate (1.45%) for tax year 2020, but does not meet the 90% threshold under the new BIT rate (2.00%), quarterly interest will be waived. Taxpayers may submit a waiver request along with their 2020 combined tax return.
Should you have any general questions, please contact Revenue Division of the City of Portland at 503-823-5157, which administers the BIT on behalf of Multnomah County.
Chief Financial Officer