Advocacy

Which States Levy The Lowest Income Tax Rates

By PAUL KATZEFF, INVESTOR’S BUSINESS DAILY

The April 15 tax deadline is creeping closer. Ever wonder how your state’s income-tax burden stacks up against other states’?

Maybe writing your latest tax check fuels your fantasies about moving to a lower tax jurisdiction.

And why not? Tax rates and rules vary from one state to another, as the nearby single-filer table shows.

Nine states levy no tax on wages. That honor roll consists of Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming.

The top burden for a single filer is California’s 13.3% marginal rate on income over $1 million, as of Jan. 1, according to the Tax Foundation.

Eight states have a flat tax — the same rate applies to all taxpayers.

Thirty-two states have three or more tax brackets. California and Missouri have 10 brackets. Hawaii has 12.

Twelve states also have city or county income taxes.

In New York and Nebraska, many high-income taxpayers pay the top rate on all income, not just amounts above the bracket threshold.

New Hampshire and Tennessee’s rates apply just to interest and dividend income.


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David F Wampole
9 years ago

Some states may not tax retirement income such as social security and pensions. Pennsylvania does not.
Your report should reflect what incone is taxed and what is not.

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