Live in Massachusetts, Work in Oregon: Which State Taxes Your Paycheck?
Answer
Expect withholding in Oregon and a return in both. Massachusetts and Oregon hold no reciprocal agreement, so the overlap is resolved after the fact: Oregon taxes the Oregon-source wages, and your Massachusetts resident return claims a credit for that tax against the Massachusetts liability on the same income.
Last verified
Without an agreement between Massachusetts and Oregon, the overlap is handled after the fact rather than prevented. That is why the filing order matters: the Oregon figure is an input to the Massachusetts return, so completing Massachusetts first means doing it twice.
A Massachusetts resident taxed by another state on the same income claims the credit for taxes paid to other states on Schedule OJC. The credit is capped at the Massachusetts tax on that income, so it removes the double tax but never refunds the excess when the other state charges more.
Oregon also has a layer below the state one, and it is the layer that survives every agreement: The Portland area layers two local income taxes on top of the state tax — the Metro supportive housing tax and the Multnomah County preschool tax — and both reach nonresidents on income sourced to the district. They are administered by the City of Portland Revenue Division, not the Department of Revenue.
What you file
- 1Nonresident return · OregonForm OR-40-N
File the Oregon nonresident return FIRST — you need the Oregon tax figure before you can complete Massachusetts.
- 2Resident return · MassachusettsSchedule OJC
File a Massachusetts resident return reporting all income, then claim the credit for tax paid to Oregon. The credit is capped at what Massachusetts would have charged on that same income, so if Oregon taxes it at a higher rate the difference is not refunded.
The two states, side by side
| Massachusetts | Oregon | |
|---|---|---|
| Taxes wages | Yes — flat | Yes — graduated |
| Reciprocity partners | None | None |
| Convenience rule | No | No |
| Nonresident return | Form 1-NR/PY | Form OR-40-N |
| Credit for other-state tax | Schedule OJC | Schedule OR-ASC-NP |
| Nonresident safe harbour | None published | None published |
| Local income tax | No | Yes |
| Revenue department | Massachusetts Department of Revenue | Oregon Department of Revenue |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Oregon and working in Massachusetts gives:Both states — credit offsets the double tax.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- Remote worker: Massachusetts → OregonHome state only
- 1099 contractor: Massachusetts → OregonHome state, plus the client state if you work there
- Moved mid-year: Massachusetts → OregonTwo part-year returns
Other Massachusetts pairs
Questions people actually ask
I live in Massachusetts and work in Oregon. Which state takes the tax out of my paycheck?
Expect withholding in Oregon and a return in both. Massachusetts and Oregon hold no reciprocal agreement, so the overlap is resolved after the fact: Oregon taxes the Oregon-source wages, and your Massachusetts resident return claims a credit for that tax against the Massachusetts liability on the same income.
Which state should my employer be withholding for?
Oregon. The wages are sourced to Oregon, so Oregon withholding is correct and there is no Massachusetts withholding to set up.
Will I end up paying tax twice on the same income?
Not twice over, but you will pay the higher of the two rates. Massachusetts gives residents a credit for tax paid to Oregon on the same income, claimed on Schedule OJC. The credit is capped at the Massachusetts tax on that income, so if Oregon taxes it more heavily the excess is not refunded by either state.
How current is this?
The Massachusetts and Oregon rules on this page were last checked against Massachusetts Department of Revenue and Oregon Department of Revenue on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Massachusetts Department of Revenue — individual income taxaccessed 2026-08-07
- Oregon Department of Revenue — individual income taxaccessed 2026-08-07