Oregon LLC structure and cost: no sales tax, but a 9.9% income tax and a gross-receipts tax that can bill you in a losing year

Oregon is known for one tax fact, that it has no sales tax, and that fact hides the rest of the picture. Oregon pays for the missing sales tax with one of the highest income taxes in the country, a 9.9% top rate, plus local income taxes for Portland-area residents, plus a tax most owners have never heard of until it bills them: the Corporate Activity Tax, a levy on gross receipts that applies to a pass-through LLC on its revenue rather than its profit. For a business with high revenue and thin margins, that last one is the surprise, because it can produce a tax bill in a year the company lost money. Take the income taxes first, then the gross-receipts tax, because the gross-receipts tax is where the planning happens.

The income taxes behind the no-sales-tax headline

Oregon’s income tax is high, and for Portland-area owners there is more on top.

Oregon taxes pass-through income at a graduated rate up to 9.9%, and Portland-area residents pay county and metro income taxes on top.

A standard Oregon LLC is a pass-through, so its income lands on the members’ Oregon returns at the state’s graduated rates, which reach 9.9% on income over roughly $125,000 for a single filer, the third-highest state rate in the country. Portland-area members pay more: Multnomah County’s Preschool for All tax adds 1.5% above $125,000, and the Metro Supportive Housing Services tax adds 1% above the same threshold, so a high-earning Portland member can face a combined state and local rate near 12.4%. Both the state tax and the local taxes follow the member’s residence, so where a member lives, not where the LLC operates, drives the rate, and the no-sales-tax advantage, real as it is for a household that spends heavily, does nothing to offset the income-tax burden on business profits.

The gross-receipts tax that bills you on revenue

Here is the seam, and it is the one that catches owners off guard.

Oregon’s Corporate Activity Tax applies to a pass-through LLC on its Oregon gross receipts over $1 million, so a high-revenue, thin-margin business can owe it even in a loss year.

The Corporate Activity Tax, or CAT, is a gross-receipts tax, not an income tax. It applies to nearly every kind of entity, including pass-through LLCs, partnerships, and sole proprietorships, once a business has more than $1 million of Oregon commercial activity, with registration required above $750,000. The tax is $250 plus 0.57% of the Oregon commercial activity above $1 million, and because it is measured on receipts rather than profit, it does not care whether the business made money. A real estate operation, a contractor, or a wholesaler with $3 million of Oregon revenue and a thin or negative margin still owes CAT on the receipts above $1 million, in a year it might owe no income tax at all because it had no profit. That inversion, a tax that grows with revenue and ignores the loss, is the Oregon-specific trap, and it is exactly the kind of levy a controller watching the income statement and a lawyer watching the deal can both miss. An LLC electing C-corporation treatment also faces Oregon’s corporate excise tax, 6.6% on the first million of income and 7.6% above, with a minimum excise tax based on Oregon sales, but the CAT sits on top of all of it regardless of the entity’s tax election. The nexus and foreign qualification guide covers where an entity legally lives; the Oregon point is that a high-revenue LLC has to budget for a tax on its receipts, separate from and in addition to the tax on its income.

No transfer tax, and no series

On moving and structuring property, Oregon is simple in one way and limited in another.

Oregon imposes no real estate transfer tax except in Washington County, so retitling property into an LLC is generally free of transfer tax.

Oregon prohibits real estate transfer taxes statewide, with one grandfathered exception: Washington County, which charges a modest rate of about 0.1%. Everywhere else in Oregon, moving a property into an LLC costs only the recording fee, not a percentage of value, so the transfer side is cheap outside that one county. What Oregon does not offer is a series LLC.

Oregon has no series LLC, so an investor holding several properties must use a separate LLC for each, with the filings and annual fee that come with each one.

Unlike Utah, Indiana, or Missouri, Oregon has no series statute, so the one-entity-with-walled-off-series structure is not available. An investor who wants each property insulated from the others’ liabilities forms a separate LLC for each, the traditional approach, and each of those LLCs is a separate filer with its own $100 annual report, covered on the filing page. That is a real recurring cost and administrative load that the series states avoid, and it interacts with the CAT, because the gross-receipts tax is measured on a taxpayer’s Oregon commercial activity and commonly controlled entities can be combined, so splitting a business across LLCs does not reliably give each its own $1 million exclusion. The series LLC guide covers the form Oregon lacks; here the answer is one property, one LLC.

What the public record shows

Oregon offers less privacy than most states covered here.

Oregon’s public business record is relatively open, and members or managers are commonly listed and updated on the annual report, so ownership is harder to keep private.

Oregon’s articles of organization and annual report call for management information that is publicly viewable, and the state’s record is relatively open, so an Oregon LLC does not provide the formation-stage anonymity that a state like Wyoming or New Mexico does. An owner seeking privacy in Oregon typically has to use a holding entity formed in a more private state as the member of record, and the anonymous LLC guide covers how those structures work. Oregon is chosen for reasons other than privacy, and an owner who needs privacy should plan for it deliberately.

The bottom line

Oregon has no sales tax, but it taxes pass-through income at a graduated rate up to 9.9%, plus Portland-area county and metro income taxes that follow the member’s residence.

The Corporate Activity Tax is a gross-receipts tax of $250 plus 0.57% on Oregon activity over $1 million, and it applies to pass-through LLCs on revenue, so a thin-margin business can owe it in a loss year.

Oregon imposes no real estate transfer tax except in Washington County, so retitling property into an LLC is generally free of transfer tax.

Oregon has no series LLC, so multiple properties require multiple LLCs, and commonly controlled entities can be combined for the CAT, so splitting does not reliably avoid it.

Oregon’s public record is relatively open, so an owner who needs privacy must build it with a holding entity rather than rely on the state.

What this page does not cover

This page is about where the entity lives and what it costs to hold and move. How creditors reach a member’s interest, the non-exclusive charging order, and the raised homestead are on the protection page. What Oregon’s law lets your operating agreement do, and why management is set by your articles, is on the governance page. The $100 formation fee, the $100 annual report, and the separate Corporate Activity Tax return are on the filing page.

Last verified August 2026.