On March 6, 2026, Senate Bill 1511 failed to pass into law. The bill would have seen Oregon’s estate tax exemption increase from $1 million to $2.5 million, adjusted for inflation. Simply put, the bill would have allowed decedents to pass up to $2.5 million tax free to their loved ones. Anything higher than $2.5 million would have been taxed at a tiered tax rate, with the rate capping at 19.9% for estates valued at more than $8.5 million.

Although opponents of the bill admitted Oregon needs to increase its estate tax exemption threshold, they also argued that the exemption was not high enough while the estate tax rates after $2.5 million were too high.

Since the bill failed, the current $1 million tax exemption still applies. This means decedents can pass up to $1 million tax free to their heirs. The first $500,000 over the $1 million exemption is taxed at 10%. Anything above $9 million is currently taxed at a rate of $16%.

Oregon’s current estate tax may still be challenged. In July 2025, Initiative Petition 51 was launched and may gain enough signatures to be placed on the November 2026 ballot leaving the estate tax issue up to voters.

Regardless of the changes or lack of changes, tax planning remains an important part of estate planning. If you wish to discuss your estate plan with one of our attorneys, please schedule a consultation online or call us at (503) 206-6401.