Because you work in OR, your income earned there will be taxable to that state. If your withholding is more than the tax due, you will receive a refund of the extra amount. You will use NONRESIDENT forms and only the OR income will be taxed instead of your total income.
The withheld tax for OR may be a deduction for you if you use Schedule A with your Federal 1040. You can use this amount OR the sales tax amount if that is higher.
Washington does not have income tax so no return need be filed for your resident state.
OR will require a nonresident return be filed. Use Form 40N. This will lead you thru listing the total income as reported on your federal return but will only tax the amount earned in OR and not the rest.
Your federal return (schedule A if you itemize) Line 5a will let you deduct the state/local tax withheld plus any balance due for any state return that was paid during 2005 plus any state estimated payments for 2005. Line 5b will allow you to deduct your actual sales tax paid for the year from your receipts OR a flat rate based on your total available income plus any big ticket items(auto, house, etc) paid during the year. You have the option of choosing either line 5a amount or 5b amount but not both.