Springfield Payroll Tax Begins January 1, 2027

City encourages employers and other affected taxpayers to review requirements and prepare for implementation

The City of Springfield is encouraging employers, employees, self-employed individuals, and independent contractors to prepare for the Springfield Payroll Tax, which begins January 1, 2027.

The Springfield City Council adopted the payroll tax ordinance on June 1, 2026, as part of the City’s ongoing efforts to address long-term financial challenges and support City services. Revenue from the tax will be budgeted and accounted for in a separate fund.

The tax applies to employers and employees associated with a taxable business location within Springfield city limits, as well as self-employed individuals and independent contractors with a physical business location within city limits. Not sure if your business is within Springfield city limits? Use the City’s Business Location Lookup Tool to check your address.

Who Pays the Tax?
The Springfield Payroll Tax has three components:

• Employers: Pay 0.1% of applicable wages associated with a taxable Springfield business location.
• Employees: Pay 0.1% of applicable wages. Employers withhold the employee portion directly from paychecks.
• Self-employed individuals and independent contractors: Pay 0.1% of qualifying net earnings from self-employment if they have a physical business location in Springfield.

A 0.1% tax equals $1 for every $1,000 of applicable wages or net earnings.

For employees, the tax generally depends on the employer’s taxable Springfield business location, not simply where an employee lives or performs their work. The City’s FAQs include examples addressing remote work and other work arrangements.

What Employers Need to Know
Employers should begin preparing now to ensure their payroll systems are ready when the tax takes effect. The tax applies to pay periods beginning on or after January 1, 2027, regardless of when employees receive their paychecks.

To prepare, employers are encouraged to:

• Determine whether their business has a location subject to the Springfield Payroll Tax.
• Identify employees and wages subject to the tax.
• Work with payroll providers, accountants, or other tax professionals to prepare for withholding.
• Review the City’s official guidance, FAQs, and Program Overview.

Important Implementation Dates

• January 1, 2027: Payroll tax begins for pay periods starting on or after this date.
• March 1, 2027: Employer registration opens.
• April 30, 2027: First quarterly employer return and payment are due for the January through March reporting period.
• April 15, 2028: First annual return and payment are due for self-employed individuals and independent contractors filing on a calendar-year basis.

Employers will be responsible for reporting and paying both the employer and employee portions of the tax through quarterly returns. Self-employed individuals and independent contractors subject to the tax will file and pay annually.

City Resources Available
The City has developed online resources to help affected taxpayers understand the requirements and prepare for implementation.

The Springfield Payroll Tax website includes:

• A Program Overview with tax rates and important dates
• Frequently Asked Questions
• The adopted Payroll Tax Ordinance and administrative rules
• Information for employers, employees, and self-employed individuals
• Additional implementation guidance as it becomes available

The City will continue sharing information and working with business and community partners to support public awareness and preparation before January 1. Learn more here. For questions about tax requirements or implementation, contact the City of Springfield Finance Department at payrolltax@springfield-or.gov or 541-726-3704.

About the City of Springfield
The City of Springfield is dedicated to providing high-quality services for its community members, fostering a safe and vibrant city, and preserving its rich heritage. Through innovative initiatives and strong partnerships, Springfield strives to enhance the quality of life for everyone who calls it home.