Income taxes are highest in these states

 

Income taxes are highest in these states

Tax Day is right around the corner. Are state income taxes part of what you owe this year? Some states charge a flat rate; others use a scale where higher earners pay a larger share; some states’ residents are off the hook. State income taxes are often used to fund schools, roads, healthcare, and public assistance programs, so let’s take a closer look at these taxes.   In 2023, the average American paid $1,395 in state income taxes. People in Oregon paid the most ($3,123 per person), followed by those in Massachusetts ($3,097) and New York ($2,970). Washington, DC, residents paid even more — an average of $4,466, though that was in local income taxes, not state income taxes.   Nine states don’t collect income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. These states fund public services through other sources, such as property and sales taxes.    Washington won’t stay on that list for long: just last month, its state legislature passed an income tax on earnings over $1 million. It’s set to take effect January 1, 2028.    Tennessee had the lowest average state income tax — $0.41 per person. New Hampshire ($107) and Washington ($108) followed. How is that possible? New Hampshire repealed its income tax in 2025, meaning income taxes were still in this 2023 data (the most recent available). And while Washington doesn’t have an income tax yet, it has a capital gains tax that state law classifies as an excise tax. However, the Census Bureau reclassifies state taxes into standardized categories to make comparisons, and labels Washington’s capital gains revenue under “Individual Income Tax.” (This took some data sleuthing, and we really did geek out about it.)     Another way to frame taxes is by burden, which measures the share of personal income paid in taxes. Oregon also had the highest state tax burden, with residents paying the state an average of 4.6% of their income. Delaware and New York tied for second at 3.6%.