Potential 2021 Kicker Credit
Why is a kicker in the news?
The Oregon Economic and Revenue Forecast released February 24, 2021 indicates Oregon’s actual revenue in 2019‒21 is expected to be better than projected, raising the possibility of an Oregon state surplus income tax credit known as the “kicker” to be claimed on the 2021 tax return that will be filed in 2022.
What is the kicker?
The kicker occurs if actual state revenues exceed forecasted revenues by 2 percent or more over the two-year budget cycle.
The excess, including the 2 percent trigger amount, is returned to taxpayers through a credit on their following year’s tax return. What happens next? This is a very early stage of the kicker determination process.
The Office of Economic Analysis (OEA) publishes quarterly revenue forecasts, and each forecast signals whether there is potential for a kicker and how much it might be. OEA will present another forecast in May 2021, but the final determination and certification will be presented in September 2021.
When would a kicker be available to taxpayers?
If OEA certifies the kicker on or before October 1, 2021, the credit will be claimed on the 2021 tax year return filed in 2022.
History of the personal income tax kicker
• The 1979 Oregon Legislature passed the 2 percent “kicker” law.
• Prior to 1994, refunds were made via a tax credit as they are now.
• From 1995 until 2011, refunds were made via checks to taxpayers.
• Prior to 2007, the refund amount was based on tax liability for the first full calendar year of the biennium. The 2007 Oregon Legislature changed the basis of the refund to tax before credits.
From Oregon Department of Revenue