Learn which states have the lowest tax rate and which have the highest.
Even though taxes aren't a fun topic, everybody loves a good list! Today we're going to rank each state income tax and show you the 7 states with the lowest income tax rates and the 7 states with the highest income tax rates.
If you ever wanted to know "How much is the state income tax in California" or "What is the state with the highest income tax?" you can easily find the answer below [answers: a.) 1% - 13.3%, b.) Connecticut].
7 States With No Income Taxes
Did you know there were 7 states in the U.S. that don't have any state income tax? That's right! If you live in either of the states below you don't have to pay a dime of income tax to the state. Of course, you still may owe plenty of money on a Federal Income Tax Return, but at least you won't have to add to it with state taxes (Sorry California Residents!)
- South Dakota
- Washington State
7 States With The Highest Income Taxes
Here are 7 states that offer the highest state income taxes. This doesn't necessarily mean they are the state with the highest overall taxes, for instance, Oregon has no sales tax, however, these are still the highest income tax states and this adds up when you compound these rates with Federal rates and self-employment tax if you're self-employed.
- California: 13.3%
- Oregon: 9.9%
- Minnesota: 9.85%
- Iowa: 8.98%
- New Jersey: 8.97%
- Vermont: 8.95%
- District Of Columbia: 8.95%
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Tips On Reducing Your Income Tax Rate
While you can't avoid paying income in most states, you still have an option for lowering your tax rates and this is by taking as many applicable deductions as possible.
For instance, if you're self-employed or you drive for work and aren't reimbursed for the expenses you can use Everlance to keep an accurate mileage log of all of your trips and add expenses or any revenue as well.
Everlance saves an average of $6,500 per year for each of our users. Join over 300k smart people and download Everlance for free today and start tracking your mileage & expenses all in one simple app!