State Government Websites Internal Revenue Service

list of us state income tax rates

These range from fully exempting all pension benefits for adults above a certain age (three states — Illinois, Mississippi, and Pennsylvania) to only exempting very specific benefits such as those for military veterans. More than a dozen states allow senior citizens an extra personal exemption or exemption credit, allowing these taxpayers to shelter twice as much of their income from tax as similar non-elderly us state income tax rates taxpayers can claim. It’s widely understood that taxpayers at all income levels tend to under-report certain income categories, especially capital gains, pass-through business income, rental income and farm income. For this reason, ITEP’s modeling incorporates estimates of the amount of unreported income of each type. This unreported income is included in our “total income” estimates for each state.

Do all 50 states have the same tax rate?

Seven states levy no individual income tax at all. Of those states taxing wages, nine have single-rate tax structures, with one rate applying to all taxable income. Conversely, 32 states and the District of Columbia levy graduated-rate income taxes, with the number of brackets varying widely by state.

The lower one’s income, the higher one’s overall effective state and local tax rate. Explore our most popular credits, below, or see Income tax creditsfor a more comprehensive list.

Tax Policy

The following links offer summaries of Maryland tax legislation that was passed during the 2013 session of the General Assembly and signed into law by Governor Martin O’Malley. All references are to the Tax-General Article , Annotated Code of Maryland, unless otherwise noted. For more information on tax legislation, visit the Maryland General Assembly’s Web site.

list of us state income tax rates

Compensation for employment and earnings from certain other income sources are withheld from the employee’s paycheck by his or her employer. For wages and salaries, the amount withheld is determined using Colorado form DR 1098. Withheld taxes are submitted by employers to the Colorado Department of Revenue. The local income tax is calculated as a percentage of your taxable income.

2022 tax brackets and federal income tax rates

Data were drawn from Tax Analysts, Federation of Tax Administrators and individual state tax return forms. 380, reducing the state’s top marginal individual income tax rate from 6.925 to 6.5 percent while consolidating seven individual income tax brackets into five. 380, Idaho’s top marginal individual income tax rate and third-lowest rate were both eliminated.

list of us state income tax rates

States with the most equitable state and local tax systems derive, on average, more than one-third of their tax revenue from income taxes, which is above the national average of 27 percent. These states promote progressivity through the structure of their income taxes, including their rates (higher marginal rates for higher-income taxpayers), deductions, exemptions, and use of targeted refundable credits. A neighboring state, Virginia, has a personal income tax with fewer tax brackets over a narrower range (2 to 5.75 percent), and a top rate that begins at a modest $17,000 of taxable income. Further, a family in the top 1 percent, earning an average of $1.4 million dollars a year, pays the same top rate as many families whose wages leave them near or even below the poverty line. On average low-income families pay .04 percent of their incomes, middle-income families pay 2.1 percent of their incomes, and the top 1 percent pay 4.6 percent. Of the three major taxes used by states, the personal income tax is the only one under which effective tax rates rise with income levels. States often use progressive income taxes as tools to help offset more regressive state and local taxes.