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Oregon · ORS 314.258Oregon real estate withholding: the least of 4%, the net proceeds or 8% of the gain

When the seller is an individual who is not an Oregon resident on the closing date, or a C corporation not domiciled or registered in Oregon, the escrow agent – or the attorney holding the funds – must withhold the least of 4% of the consideration, the net proceeds, or 8% of the gain includable in Oregon income (ORS 314.258). The agent may rely on the seller's written statement of the gain. No withholding when the consideration is $100,000 or less, when the seller gives a written assurance that the IRC §121 home exclusion applies, or affirms Oregon tax is unlikely. On a $500,000 sale with $100,000 of gain: $8,000.

Who withholds, how much and an example

  1. Who withholds

    The authorized agent providing closing and settlement services – the escrow agent or the attorney holding the funds (ORS 314.258(1), (2)).

  2. Who is covered

    Nonresident individuals on the closing date and C corporations not domiciled or registered in Oregon (314.258(1)(f)).

  3. Amount

    The least of 4% of consideration, the net proceeds, or 8% of the Oregon gain (314.258(2)).

  4. Example

    $500,000 sale, $100,000 gain → least of $20,000 or $8,000 = $8,000.

  5. Agent's risk

    An agent who fails to withhold can be penalized the greater of $500 or 10% of the required amount (314.258(4)(c)).

No withholding when

  • Consideration of $100,000 or less (314.258(3)(a)).
  • Foreclosure, writ of execution, forfeiture or deed in lieu with no additional money.
  • The seller is a personal representative, executor, conservator or bankruptcy trustee.
  • Written assurance that the IRC §121 home sale exclusion applies, or a written affirmation that Oregon tax is unlikely.
  • The amount to withhold would be under $100.

What the TC checks before closing

  • Seller's residency and entity type – asked early, not at the closing table.
  • The signed exemption certificate or affidavit, in the file before funds are disbursed.
  • The withholding line on the seller's settlement statement and who remits it, and by when.

Questions about this withholding

How much does Oregon withhold on a real estate sale?

The least of 4% of the price, the net proceeds or 8% of the Oregon gain.

Does Oregon withhold from residents?

No. ORS 314.258 covers individuals who are not Oregon residents on the closing date and certain out-of-state C corporations.

Can a nonresident selling a former home avoid Oregon withholding?

Yes, with a written assurance that the IRC §121 exclusion applies.

Related guides

Put the residency question and the exemption certificate on the checklist as tasks with an owner and due date in ClosingCode, with the documents attached to the deal.

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Source: Oregon Revised Statutes 314.258 (oregonlegislature.gov, read October 25, 2026).

General information, not legal or tax advice. ClosingCode is software; it is not a law firm or brokerage. This guide is not a substitute for the advice or services of an attorney.