2025 Regular Session
HB 3738
Creates an Oregon personal income tax subtraction for amounts received from retirement plans.
In Committee
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Sign in to take action- Introduced
- Passed House
- Passed Senate
- To Governor
- Became Law
Bill overview
This bill creates a new subtraction on Oregon state income taxes for individuals who receive money from retirement plans, such as 401(k)s or IRAs. The subtraction applies to income reported on federal tax returns. The change will be effective for tax years beginning on or after January 1, 2026, and before January 1, 2032.
Key provisions
- Allows a subtraction on Oregon state income tax for retirement plan distributions.
- The subtraction applies to income reported on federal tax returns.
- Qualified retirement plans include those under section 401(k) of the Internal Revenue Code and individual retirement accounts under section 408.
- The subtraction cannot be used to reduce other deductions or credits on state or federal tax returns.
- The change applies to tax years beginning January 1, 2026.
Who is affected
- Oregon taxpayers
- Individuals with retirement accounts
- Tax professionals
Notable changes
- Introduces a new state income tax deduction for retirement plan distributions.
- Aligns with federal tax treatment of retirement income.
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