Oklahoma Income Tax Rates & Brackets (Tax Year 2025 — Filed in 2026)

Remote Workers and Multi-State Taxation

Living in Oklahoma, Working for an Out-of-State Employer

As an Oklahoma resident, you owe Oklahoma income tax on all income, regardless of where your employer is located. This is a fundamental principle of Oklahoma tax law: employer location does not determine tax obligation — residency does.

What this means in practice:

• A remote worker living in Oklahoma for an employer headquartered in Texas, California, or any other state owes Oklahoma income tax on that income
• Oklahoma withholding should be set up with your Oklahoma-based employer or managed through estimated tax payments
• Wages earned outside Oklahoma are included in Oklahoma resident income, and credit for taxes paid to other states may be claimed on Form 511-TX

Example: An Oklahoma resident working remotely for a Dallas-based company owes Oklahoma income tax on their full salary. Since Texas has no income tax, there is no credit to claim — the full amount is taxable in Oklahoma.

Source: 2025 Form 511 Packet, “Resident Income” — https://oklahoma.gov/content/dam/ok/en/tax/documents/forms/individuals/current/511-Pkt.pdf

Working in Oklahoma, Living in Another State

Nonresidents who perform work physically in Oklahoma owe Oklahoma income tax on income earned from Oklahoma sources.

Physical Presence Rule: Income is sourced to Oklahoma based on where work is physically performed. If you travel to Oklahoma for work, the wages earned during those days are Oklahoma-source income.

Telecommuting from outside Oklahoma for an Oklahoma employer: If you are a nonresident who works remotely from your home state for an Oklahoma employer, your wages are generally not Oklahoma-source income, because the work is performed outside Oklahoma.

Source: 68 OS § 2358; https://oklahoma.gov/content/dam/ok/en/tax/documents/forms/individuals/current/511-NR-Pkt.pdf

⚠️ Interstate Tax Risk Indicator

Oklahoma remote workers commonly encounter dual taxation complications with the following states:

Working with these states requires careful planning:

• New York — Applies the “convenience of the employer” rule; may tax nonresident income even if work is performed outside NY, if for the convenience of the employee
• California — Aggressive residency auditing for extended work periods; may claim extended presence creates California tax obligations
• Pennsylvania — 3,000+ local income tax jurisdictions; complex withholding requirements
• New Jersey / Connecticut — Complex credit systems when working across state lines

Source: Form 511-TX instructions — https://oklahoma.gov/content/dam/ok/en/tax/documents/forms/individuals/current/511-TX.pdf | IRS Publication 505

“Convenience of the Employer” Rule

Oklahoma does NOT apply a “convenience of the employer” rule.

Oklahoma nonresidents are taxed only on income from work physically performed in Oklahoma. If a nonresident works remotely from their home state, even for an Oklahoma-based employer, Oklahoma does not claim the right to tax that income solely because the employer is in Oklahoma.

This is favorable for nonresidents working remotely for Oklahoma companies: their remote work income is not subject to Oklahoma tax.

Source: 68 OS § 2358 (sourcing rules based on physical performance of services) — https://www.oscn.net/applications/oscn/index.asp?level=1&title=68

Reciprocal Agreements

Oklahoma does NOT have formal reciprocal income tax agreements with other states.

Without reciprocity, if you live in one state and work in another, you are generally subject to tax in both states. The credit for taxes paid to other states (Form 511-TX) mitigates — but does not always eliminate — double taxation.

What to do without reciprocity:

1. File a resident return in Oklahoma reporting all income
2. File a nonresident return in the state where you physically work
3. Claim the Form 511-TX credit on your Oklahoma return for taxes paid to the other state (for residents only; nonresidents do not qualify)

Source: Form 511-TX — https://oklahoma.gov/content/dam/ok/en/tax/documents/forms/individuals/current/511-TX.pdf

Multi-State Tax Filing for Oklahoma Residents

When earning income in multiple states as an Oklahoma resident:

1. File a resident return (Form 511) in Oklahoma reporting all income from all sources
2. File nonresident returns in other states where income was physically earned
3. Claim the Credit for Taxes Paid to Another State (Form 511-TX) on your Oklahoma return

How the Form 511-TX credit works:

• The credit applies only to income from personal services taxed by both Oklahoma and the other state
• A separate Form 511-TX is required for each state
• Attach a complete copy of the other state’s return and all W-2s

Forms required:

• Oklahoma Form 511 (resident return — reports all income)
• Oklahoma Form 511-TX (credit for taxes paid to other state)
• Nonresident return in the other state

Source: Form 511-TX — https://oklahoma.gov/content/dam/ok/en/tax/documents/forms/individuals/current/511-TX.pdf