Legislative staff briefs Senate Finance and Revenue on growth and structure of Oregon estate tax

On Feb. 10, 2025, the Oregon Senate Committee on Finance and Revenue received an informational briefing from the Legislative Revenue Office that outlined how Oregon’s estate tax is calculated, traced its legal history and showed recent growth in receipts and filers.

The briefing, delivered by John Hart of the Legislative Revenue Office, said Oregon’s estate-tax receipts rose from roughly $200 million in fiscal 2017 to about $350 million in the budget period covering fiscal 2026–27. Hart told the committee that tax-return data are complete only through tax year 2022 because estate returns are due 12 months after death and filings and extensions can delay final counts.

Hart summarized how the tax is computed: it starts with the gross estate (assets minus debt), subtracts administration expenses, an existing natural-resource exemption and unlimited bequests to a surviving spouse or to charity, and then applies Oregon’s tax brackets to the resulting taxable estate. He said Oregon’s current code uses definitions tied to federal law circa 2010 and that the state’s present structure traces to a 2011 rewrite following federal changes in and after 2001.

Hart told the committee that tax returns for 2022 showed about 3,100 total returns, and that 888 of those returns were in a category that paid no net tax because deductions (including spousal bequests) reduced the taxable estate. He also emphasized that “about 90 to 95 percent of deaths don’t result in a return,” because most decedents’ estates are below filing thresholds.

The office provided a breakdown showing rising average tax-per-return since 2012 (about $68,000 per return in 2012 to substantially higher averages later in the decade) and noted that a small number of very large estates can drive year-to-year swings; Hart described 2019 as an outlier year driven by a few very large returns.

Committee members asked clarifying questions about the number of filers over time, the composition of the taxable base and the natural-resource credit enacted in 2023. Hart confirmed that the natural-resource deduction and the credit (identified in 2023 legislation) remain options in different circumstances and that filers may choose one or the other depending on eligibility.

Hart also reviewed filing mechanics: estate tax returns and payments are generally due 12 months after a decedent’s death; a six-month extension for filing is available and further payment extensions may be granted with interest. Those timing rules are the reason the Legislative Revenue Office’s most recent complete returns are for 2022.

The briefing closed with Hart offering further questions and materials; the committee then opened a public hearing on Senate Bill 124, which would add an additional exemption and require the Department of Revenue to determine an annual cost-of-living adjustment.