Business Taxes on Rental Owners, and Rule LIC-1.09
The City of Portland treats renting residential or commercial real property as doing business. Its Business License Tax is 2.6 percent of net income, with a gross receipts exemption under $75,000 for tax years beginning in 2026 and under $100,000 from 2027. The Multnomah County Business Income Tax is 2 percent, and it exempts gross receipts under $100,000 and individuals who rent fewer than ten residential units, though exempt filers still file each year to claim the exemption.
Under Rule LIC-1.09, the City, Multnomah County and Metro follow the federal and Oregon deferral for like-kind exchanges. A local business tax return must be filed for each year from the exchange until the deferred gain is reported, even with no other reason to file.
Sources: City of Portland Revenue Division: business taxes; Portland, Multnomah County and Metro Rule LIC-1.09 (like-kind exchanges)
Metro and Multnomah County Personal Income Taxes
The Metro Supportive Housing Services tax is 1 percent of taxable income over $125,000 single or $200,000 joint, indexed from 2026 to $128,000 and $205,000. Multnomah County's Preschool for All tax is 1.5 percent over $125,000 single or $200,000 joint, plus another 1.5 percent over $250,000 or $400,000, and the Revenue Division lists a 0.8 percent increase for 2028. Both start from Oregon taxable income, so a gain deferred for Oregon generally stays out of these taxes too. A large taxable sale, on the other hand, can push a year's income past both thresholds.
Sources: City of Portland Revenue Division: personal income taxes (Metro SHS, Preschool for All); City of Portland Revenue Division: 2025 Form MET-40
Oregon Tax, Withholding and Form OR-24
Oregon's top rate for 2025 is 9.9 percent, on taxable income over $125,000 single or $250,000 joint. When a nonresident sells Oregon real property, the escrow agent withholds the smallest of 4 percent of the price, 8 percent of the taxable gain, or the net proceeds paid to the seller. Form OR-18-WC lets the seller exclude gain deferred under a federal nonrecognition section, and its instructions say funds sent to a qualified intermediary do not count as net proceeds.
If you exchange Oregon property for property in another state, you file Form OR-24 for the year of the exchange and every year after, until you dispose of the replacement property.
Sources: Oregon Department of Revenue: 2025 Form OR-40 instructions; Oregon Department of Revenue: Form OR-18-WC instructions; Oregon Department of Revenue: Form OR-18-WC; Oregon Department of Revenue: Form OR-24 instructions
Transfer Tax and Recording in the Portland Area
Oregon law bars new local taxes on transferring real property. Washington County, which covers part of the Portland area, still charges $1 per $1,000 of the selling price under an older ordinance, with liability shared by buyer and seller. Deeds are recorded in the county where the property sits; for Multnomah County property that is the Multnomah County Recorder.
Sources: ORS 306.815 (local transfer taxes); Washington County, Oregon: transfer tax; Multnomah County: recording documents
How We Handle a Portland Exchange
We sign the exchange agreement before closing, so your escrow agent can send the proceeds straight to us, hold the funds, receive your identification by Day 45 and fund the replacement by Day 180. Give your CPA the exchange documents early: Portland's local return, Form OR-24 and the federal Form 8824 all draw on the same dates and figures.
Portland, OR 1031 Exchange Questions
Do I keep filing in Portland after a 1031 exchange?
Yes. Under Rule LIC-1.09, a local business tax return is due each year from the exchange until the deferred gain is reported. If the replacement property is outside Oregon, you also file Form OR-24 each year until you dispose of it.
Is there a real estate transfer tax in Portland?
Oregon law bars new local transfer taxes. Washington County, which covers part of the Portland area, charges $1 per $1,000 of the selling price under an ordinance that predates that law.
State tax facts on this page were checked against official Portland, OR sources in November 2026. Tax rules change, and this page is general information, not tax advice for your situation. Confirm the details with your tax advisor before you sell.
Ready to plan a 1031 exchange on your Portland investment property? Contact 1031 Federal Exchange today.