Oregonians to get record ‘kicker’ tax credit next year

(Update: Adding average payout, more details)

SALEM, Ore. (AP) — Oregon taxpayers will see the largest-ever state income tax refund next year, thanks to state revenue coming in at more than 9% above projections, state economists said Wednesday.

They say the top 1% of taxpayers can expect refunds of $15,214, while the median refund will be $346.

The average payout to all taxpayers is expected to be $739.

A total of more than $1.57 billion is expected to flow back to personal income taxpayers after they file their 2019 returns.

That compares to a refund projection in May of a little more than $1.4 billion.

The latest tally given to lawmakers continues a trend over the past two years, as state tax revenue outpaces expectations, Oregon Public Broadcasting reported .

Money flowing into the state’s general and lottery funds came in $2.6 billion above what officials expected in 2017. That created a situation where Oregon reserve funds are at an all-time high — at more than $3.7 billion — even as economists warn of a possible economic slowdown on the horizon.

Oregon’s unique refund policy also means the state can’t use all of the unexpected money.

Under state law, a “kicker” is triggered whenever actual personal income tax receipts come in at least 2% higher than initial projections. In such cases, any money collected above initial forecasts flows back to taxpayers in the form of tax credits.

The unprecedented revenues have roots in a number of factors, including federal tax changes that led businesses to put off paying taxes until this year and ratcheting up corporate tax receipts by around 50%. Economists say those impacts are likely short-term.

“Even without a recession, we’re expecting that it’s going to be hard to match the revenue we saw in the last biennium,” state economist Mark McMullen told lawmakers on the House and Senate revenue committees.