Oregon has an unusual law, introduced in 1979, which provides for a surplus credit ― known as the “kicker” ― to return surplus revenue to taxpayers every two years. The Oregon Department of Administrative Services Office of Economic Analysis makes the determination on whether and how much of a kicker there will be each biennium and if there is, the kicker is made available to taxpayers as a refundable credit. This year’s kicker is significantly higher than any previous years, including the highest on record of $1.9B. Oregon tax filers will receive $5.61B back for tax year 2023.

Your credit is based on how much you paid in taxes in 2022, so higher income earners will receive larger kicker refunds. All Oregonians will receive a kicker that represents the same percentage of their tax liability. The Oregon Department of Revenue has created a “What’s My Kicker?” tool where taxpayers can look up their rebate: access it online here. Alternatively, you can calculate your expected kicker manually: multiply your 2022 tax liability (line 22 on form OR-40) by 44.28%. The median Oregon taxpayer will receive around $1,000 and the average earner may see around $2,000, but economists predict earners in the top 1% could receive between $40,000 and $45,000.

Taxpayers have the option of donating their refund to the Oregon State School fund (must be the entire kicker amount), or to an approved charity. It can also be applied to any unpaid taxes or other state debt such as school loans.

Why such a large kicker this year? Forecasters underestimated Oregon’s resiliency after the pandemic; the state’s economy and tax revenues bounced back more quickly than anticipated. The estimates used to build the 2021-23 state budget were significantly off base.

You can learn more about Oregon’s kicker tax at https://www.oregon.gov/dor/programs/individuals/Pages/Kicker.aspx