Bill > SB694

This bill modifies Oregon's child tax credit by increasing the maximum credit amount from $1,000 to $1,200 per dependent and raising the income threshold for full credit eligibility from $25,000 to $35,000. The credit applies only to dependents under six years old who qualify under federal tax code definitions, and taxpayers can claim credits for up to five dependents. The bill introduces a new sliding scale reduction mechanism where the credit amount decreases proportionally for taxpayers with qualifying incomes above $35,000, calculated by dividing the income excess by $10,000 (previously $5,000). The bill also updates the cost-of-living adjustment calculation to use the second quarter of 2024 as the baseline year for future indexing. These changes will apply to tax years beginning on or after January 1, 2026, and the bill itself will take effect 91 days after the 2025 legislative session adjourns. Notably, the credit remains refundable, meaning taxpayers can receive the full credit even if it exceeds their tax liability, and can be claimed using individual taxpayer identification numbers.

Budget and Finance, Health and Social Services

https://olis.oregonlegislature.gov/liz/2025R1/Measures/Overview/SB694