ebs Associates Blog

Important Update: Issue With Oregon Statewide Transit Tax

Posted by Joy Huffman on Apr 26, 2018

An issue with the new Statewide Transit Tax was brought to my attention today which may effect payroll processing in QuickBooks.

The new Transit Tax does not go into effect until July 1, but Intuit/QuickBooks has already put it into the payroll items list so it is affecting payroll.

Unfortunately, because it is completely set up, some of our clients may run into issues running their payroll. So what you will have to do is click on the notification (if you get one while running payroll) then click on the "Other Taxes" tab when it pops up and then click ok.

We have contacted our Intuit Payroll representatives to notify them of the problem and will update this post with with any new information we receive.

If you have any questions or concerns, please contact your ebs Account Manager, or call our main line at 503-885-0776 to schedule an appointment to meet with our ProAdvisor Services team.

Oregon Department of Revenue : Businesses : Statewide transit tax

The 2017 Oregon Legislature passed House Bill (HB) 2017, which included the new statewide transit tax. Parts of HB 2017 related to the statewide transit tax were amended in the 2018 session.

On July 1, 2018, employers must start withholding the tax (one-tenth of 1 percent or .001) from:

  • Wages of Oregon residents (regardless of where the work is performed).
  • Wages of nonresidents who perform services in Oregon.

The statewide transit tax is calculated based on the employee's wages as defined in ORS 316.162. Employees who aren't subject to regular income tax withholding due to high exemptions, wages below the threshold for income tax withholding, or other factors are subject to statewide transit tax withholding.

The definition of "wages" excludes amounts paid to certain types of employees and independent contractors (ORS 316.162). Self-employment income isn't subject to this tax.

This tax isn't related to the Lane or TriMet transit payroll taxes. Transit payroll taxes are imposed on the employer based on the amount of payroll. The statewide transit tax is imposed on the wages of each employee, but the employer is responsible for withholding, reporting, and remitting the statewide transit tax.

Revenue from the statewide transit tax will go into the Statewide Transportation

For more information, see our frequently asked questions.

"Oregon Department Of Revenue : Businesses : Statewide Transit Tax ". 2018. Oregon.Gov. Accessed April 26 2018. http://www.oregon.gov/DOR/programs/businesses/Pages/statewide-transit-tax.aspx "

Topics: QuicKBooks Payroll, taxes

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