If you live in Portland and earn a high income, you likely see two specific line items on your paystub (or your tax return) that look painfully similar.
- Metro SHS Tax
- Multnomah PFA Tax
While they sound alike, they are completely different animals. The Preschool for All (PFA) tax is specific to Multnomah County, and for the 2026 tax year, there are crucial changes—including a delayed rate hike—that you need to know about.
If your household income exceeds $200,000, this tax applies to you. Here is your 2026 briefing.
TL;DR: The PFA Tax Snapshot (2026)
| Feature | The Details |
| Who Pays? | Individuals/Couples living in Multnomah County. |
| Thresholds: | Single: Income over $125k. Joint: Income over $200k. |
| 2026 Rate: | 1.5% (Tier 1) and 3.0% (Tier 2). Note: The hike to 2.3% was delayed to 2027. |
| New Rule: | Estimated payments are now only required if you owe $5,000+ (up from $1,000). |
| Filing Portal: | Portland Revenue Online (PRO) |
1. The “Good News”: The Rate Hike Was Delayed
When voters passed this measure in 2020, the law included a scheduled tax increase for 2026.
- Original Plan: Increase the Tier 1 rate from 1.5% to 2.3% in Jan 2026.
- The Update: The County Commissioners voted to delay this increase.
For Tax Year 2026, the rates remain:
- Tier 1 (1.5%): Applies to income over $125,000 (Single) or $200,000 (Married Filing Jointly).
- Tier 2 (3.0%): Applies to income over $250,000 (Single) or $400,000 (Married Filing Jointly).
Example:
If you file Jointly and earn $300,000:
- The first $200,000 is tax-free.
- You pay 1.5% on the remaining $100,000.
- Total Bill: $1,500.
2. PFA vs. Metro SHS (Don’t Confuse Them)
This is the most common mistake I see on tax returns. People assume paying one covers the other. It does not.
| Tax | Preschool for All (PFA) | Metro Supportive Housing (SHS) |
| Jurisdiction | Multnomah County Only (Portland, Gresham, Troutdale). | 3 Counties (Multnomah, Washington, Clackamas). |
| Single Threshold | > $125,000 | > $125,000 |
| Joint Threshold | > $200,000 | > $200,000 |
| Rate | 1.5% to 3.0% (Progressive) | 1.0% (Flat) |
The “Double Tax” Trap:
If you live in Portland (which is in Multnomah County AND Metro), you owe BOTH.
- Scenario: A couple in NE Portland earning $250,000 taxable income.
- Metro Bill: $500 (1% of the $50k over threshold).
- PFA Bill: $750 (1.5% of the $50k over threshold).
- Total Local Tax: $1,250 (plus the Arts Tax, plus the TriMet tax…).
3. New for 2026: The $5,000 Estimated Payment Rule
In previous years, if you expected to owe more than $1,000 in tax, you were required to make quarterly estimated payments (or face a penalty). This created a paperwork nightmare for people who only owed a small amount.
The Change:
Starting Tax Year 2026, Multnomah County has aligned with Metro to raise the estimated payment threshold to $5,000.
- What this means: Unless you are a very high earner (earning roughly $530,000+ per year), you likely no longer need to make manual quarterly payments. You can simply pay the full balance by April 15th without penalty.
- Warning: Check your specific situation. If your withholding is zero, you might still want to prepay to avoid a massive bill in April.
4. Geography: The “Gresham” Factor
Unlike the Metro tax (which hits Beaverton and Lake Oswego), the PFA tax stops at the county line.
- Gresham & Troutdale: YES, you pay PFA (you are in Multnomah County).
- Lake Oswego (Clackamas side): NO PFA.
- Beaverton (Washington side): NO PFA.
The Remote Worker Rule:
If you live in Vancouver, WA (no tax) but commute to an office in Portland, you pay the tax only on the income earned while physically in the county.
- If you work 2 days in Portland and 3 days at home in WA, only 40% of your income is subject to PFA.
Frequently Asked Questions
Does my employer withhold this automatically?
Ideally, yes. Employers with a Multnomah County location are required to offer withholding for employees earning over $200,000. Check your paystub for “Mult Co PFA” or “Local Tax.” If it’s missing, you need to save that money yourself.
Is this tax deductible?
Yes. Like the Metro SHS tax, the PFA tax is a “State and Local Tax” (SALT). If you itemize deductions on your Federal Return (Schedule A), you can include this. However, remember the $10,000 SALT cap still applies on the Federal side.
What happens if I move mid-year?
You will file a “Part-Year Resident” return. You will only owe tax on the income earned during the months you lived within Multnomah County.
Stop Overpaying (or Underpaying)
The difference between living on one side of the county line or the other can mean thousands of dollars in tax liability.
At Bridgetown Bookkeeping, we help high-income professionals and business owners forecast their total local tax liability—City, Metro, PFA, and TriMet—so there are no surprises on April 15th.
Bridgetown Bookkeeping 
Leave a comment