Residents in blue states pay more taxes than those in red states, according to an analysis by the Washington, D.C.-based Tax Foundation.Its report, “State Individual Income Tax Rates and Brackets for 2019,” maps who pays the most and least in state individual income taxes, and provides an overview of each state’s tax brackets and reform measures.Individual income taxes are a major source of state government revenue, accounting for 37 percent of state tax collections, the foundation notes. Individuals are “actively responsible for filing their income taxes,” the report states, compared to other tax revenue that states receive through indirect payments of sales and excise taxes.According to data released from the Internal Revenue Service, in 2014, 139.6 million taxpayers reported earning $9.71 trillion in adjusted gross income and paid $1.37 trillion in individual income taxes.The top 50 percent of all taxpayers paid 97.3 percent of all individual income … [Read more...] about Tax Day: In response to federal tax reform, several states lowered individual income taxes
States with lowest income tax
Samuel Stebbins 24/7 Wall Street Published 6:00 AM EDT Mar 17, 2019 Taxes, unpopular though they may be, fund government services Americans count on every day. Individual income taxes may be especially hated – but they are also important, accounting for 48 percent of federal tax revenue. For the vast majority of states, income taxes are also critical to governments' balance sheets. The result? Most Americans pay income tax twice every year – once to federal government, and once to their state. No two state tax codes are exactly alike, however, and there are a handful of states that manage to function without levying an individual income tax. To identify the states with no income tax, 24/7 Wall St. reviewed state level tax codes using tax data compiled by tax policy research organization Tax Foundation. After you file: How long should I keep my tax returns? Don't do these!: 10 common filing mistakes to avoid this year In the vast majority of states, individual … [Read more...] about State income tax: 7 states where residents don’t have to pay anything
Syracuse, N.Y. -- New Yorkers pay more in state and local individual income taxes per capita than anyone else in the nation.Residents of the Empire State paid $2,969 per capita in state and local individual income taxes in fiscal year 2016, the last year for which data is available, according to a new report by the Tax Foundation, a Washington, D.C.-based tax policy research organization. That puts New York at the top of the list. The other states in the top five were Maryland ($2,276), Massachusetts ($2,115), Connecticut ($2,106) and California ($2,055). The states with the lowest income tax collections per capita were Tennessee ($49), New Hampshire ($66), North Dakota ($465), Arizona ($574) and Mississippi ($603). (Tennessee and New Hampshire tax investment income but not wage income.)Seven states -- Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming -- do not levy an individual income tax.On average, state and local governments collected $1,164 per capita in … [Read more...] about We’re #1: New Yorkers pay highest state and local income taxes
Here’s a helpful yet limited survey — comparing the states’ income tax paid on earned income — combined with the federal income tax. The comparison uses $50K and $200K salaries. CA has a highly progressive state income tax, so we don’t rank TOO badly at $50K. At $200K, CA is a close second to Oregon — the worst state. Indeed, at $200K, less than $100 tax separates these worst two states — they are essentially tied. CA moves to #1 above $200K (not included in the article), and the difference between the two states becomes more pronounced, the higher one’s income is above that $200K benchmark. This comparison counts only earned income — capital gains and dividends are treated differently by many states (NOT California). And it understandably doesn’t include other taxes — notably property taxes and sales taxes. That would constitute a MAJOR project with lots of logistical difficulties. BTW, … [Read more...] about How much is left after total income taxes are paid at $50K and $200K of income?
Is it better to live in a state with no income tax? It’s a great question to ask, especially when considering how much of our paycheck is already set aside for Uncle Sam. Seven U.S. states forgo individual income taxes as of 2018: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Residents of New Hampshire and Tennessee are also spared from handing over an extra chunk of their paycheck, though they do pay tax on dividends and income from investments. The main benefit of eliminating the individual income tax, proponents say, is that states with no income tax on residents become beacons for growth. They’re better at creating jobs and keeping a core of young, educated workers from moving to other states. The American Legislative Exchange Council reports that over the past decade the nine states without a personal income tax have consistently outperformed the nine states with the highest taxes on personal income in job creation, population growth and even … [Read more...] about Is a state with no income tax — like Washington — better or worse?