Did you know that several states have their own taxes unique to them that businesses must file in order to remain compliant? States such as Washington, Delaware, and Oregon have state specific taxes. Oregon’s Corporate Activity Tax (CAT) is a state specific tax that was signed into law in May of 2019 and became applicable to tax years beginning January 1, 2020.
Oregon’s Corporate Activity Tax is a tax for the privilege of doing business in Oregon and is based on commercial activity in Oregon. This tax applies to commercial activity in excess of $1 million for all types of business entities including C and S corporations, sole proprietorships, partnerships, LLCs and other entities. The state defines commercial activity as “the total amount realized by a taxpayer from the transactions and activity in the regular course of their business in Oregon without deduction for expenses incurred by the business.” Businesses with commercial activity of $750,000+ must be registered for the CAT within 30 days of exceeding the threshold, but do not have a payment obligation until the commercial activity is more than $1 million.