IRS, State Clarify No Taxes Owed on One Time Assistance Payments

Posted on February 11, 2023

Salem, OR — Oregonians who received One-Time Assistance Payments (OTAP) of $600 last June do not owe taxes on those payments, the Oregon Department of Revenue announced Friday.

“Based on the language in the legislation creating the payments, we have always believed that they were not taxable to Oregon. The IRS clarified today that Oregonians who received the payments will not owe federal taxes on them, as well,” said Department of Revenue Director Betsy Imholt.

In its statement issued today, the IRS noted taxpayers in many states would not need to report this type of assistance payment on their 2022 tax returns. Oregon was among 17 states where the IRS said it would not challenge such payments as excludable for federal income tax purposes in 2022.

The IRS statement clarified that Oregonians who received OTAP payments last year can go ahead and file their 2022 federal and state income tax returns as soon as they are ready. This year’s filing deadline is April 18.

E-filing is the fastest way for a taxpayer to get their refund. On average, taxpayers who e-file their returns and request their refund via direct deposit receive their refund 34 days sooner than taxpayers who mail their paper returns and request paper refund checks. Taxpayers should file just once. Sending a paper return through the mail after e-filing will delay your refund.

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