You have filed your Federal return. You have registered with the City of Portland. You even paid your Arts Tax. You think you are done.

Then, your CPA asks: “Did you calculate your TriMet tax?”

For self-employed individuals in the Portland metro area, the TriMet Transportation Tax is often the most overlooked liability. It is not collected by the IRS, and it is not collected by the City of Portland. It lives in its own unique category, administered by the Oregon Department of Revenue.

Here is exactly what you need to know to handle this tax correctly for the 2026 Tax Year.

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TL;DR: The TriMet Tax Snapshot

Feature	The Details
What is it?	A tax to fund regional transit (Bus, MAX, WES).
Who Pays?	Self-employed individuals with net earnings in the district.
2026 Rate:	0.8237% (Scheduled rate for tax year 2026).
Exemption:	If your net earnings are under $400, you are exempt.
Due Date:	April 15 (Filed with your Oregon Personal Income Tax).

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1. What is this tax?

Most employees don’t know this tax exists because their employer pays it for them (you might see it on a paystub as a payroll tax).

However, if you are Self-Employed (Sole Proprietor, Independent Contractor, or Partner), you are both the employer and the employee. Therefore, the responsibility to fund the transit system falls on you.

It is calculated on your Net Earnings from Self-Employment.

• Note: This is usually the same number found on your Federal Schedule SE.

2. The 2026 Rate (It went up again)

The TriMet tax rate is not static. Under a state law passed nearly a decade ago, the rate increases incrementally every single year until 2026.

• 2024 Rate: 0.8037%
• 2025 Rate: 0.8137%
• 2026 Rate: 0.8237%

The Math:

If you made **$100,000** in net profit (after expenses) in 2026:

$100,000 x 0.008237 = $823.70

It isn’t a massive amount compared to Federal taxes, but it is large enough to trigger penalties if you miss it.

3. The Geography: Am I in the “District”?

This is the most confusing part. “TriMet” is not the same as “Portland,” “Multnomah County,” or “Metro.” It has its own unique boundaries.

• Who is IN: Almost all of Portland, Gresham, Beaverton, Hillsboro, Tigard, Tualatin, Lake Oswego, West Linn, and Milwaukie.
• Who is OUT: Sandy, Wilsonville, Canby, and rural parts of Washington/Clackamas counties.

The “Where You Work” Rule:

This tax is based on where the work is performed, not necessarily where you sleep.

• Scenario A: You live in Sandy (Out) but have an office in Gresham (In). You pay.
• Scenario B: You live in Portland (In) but drive to Salem (Out) to do all your consulting work. You do NOT pay on that Salem income.
• Scenario C: You work from a home office in Beaverton (In). You pay.

4. How to File & Pay

Unlike the “Portland Business License Tax” (which goes to the City), the TriMet tax is collected by the Oregon Department of Revenue.

Option 1: Your Personal Tax Return (Form OR-40)

Most people file this annually alongside their personal state income tax return. If you use software like TurboTax or have a CPA, there is usually a specific form (Form OR-TM) generated for this.

Option 2: Revenue Online

You can pay this directly via the state’s portal, Oregon Revenue Online.

• Warning: Do not confuse this with “Portland Revenue Online (PRO).” They are two different websites for two different governments.

5. Common Pitfalls to Avoid

Pitfall #1: S-Corp Owners Forgetting Payroll

If you are an S-Corp, you wear two hats:

1. W-2 Employee: Your company runs payroll for you. The TriMet tax should be paid through payroll (Employer side).
2. Shareholder: You take a distribution (profit). Generally, the TriMet tax does not apply to the K-1 distribution, only the payroll wages.

• Check your payroll settings! Ensure Gusto/ADP is set up to withhold the Oregon Transit Tax (statewide) AND the TriMet District Tax.

Pitfall #2: Ignoring the “Apportionment”

If you work 50% of the time in Portland (In District) and 50% of the time in Salem (Out of District), you only pay tax on 50% of your income. You must keep a log or reasonable record of where your work occurred to claim this reduction.

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Frequently Asked Questions

Is this tax deductible?

Yes. For Federal tax purposes, the TriMet tax is considered a “State and Local Tax.” It can typically be deducted as a business expense (on Schedule C) or an itemized deduction, depending on how you file.

I also pay the “Statewide Transit Tax.” Is that the same thing?

No. Oregon has two transit taxes.

1. Statewide Transit Tax: 0.1% (Paid by everyone in Oregon).
2. TriMet Tax: ~0.82% (Paid only by people in the TriMet district).You likely owe both.

Read More: For a full list of every local tax agency you need to satisfy, check out my Ultimate Guide to Portland Business Taxes.

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Stop tracking 6 different tax rates.

Between the City, the County, Metro, TriMet, and the State, a Portland business owner has to satisfy five different tax agencies.

At Bridgetown Bookkeeping, we track these rates so you don’t have to. We ensure your books identify exactly which income is taxable in which district, keeping you audit-proof and stress-free.