iAdviser State Income Tax Rates: All 50 States Ranked (2026)
Data Notice: State tax rates cited in this article reflect projected 2026 figures. State legislatures change rates frequently. Confirm your state’s current rates with your state tax authority before making relocation or planning decisions.
State Income Tax Rates: All 50 States Ranked for 2026
State income taxes add 0% to 13.3% on top of your federal tax bill. For a household earning $200,000, the difference between living in Texas (0%) and California (9.3% effective) is approximately $18,600 per year. Over a decade, that is nearly $200,000 in after-tax wealth — enough to fund retirement years earlier. This guide ranks all 50 states by top marginal rate, effective rate on $100,000, and retirement-friendliness.
No Income Tax States (9)
These states impose no tax on wages, salaries, or investment income:
| State | Notes |
|---|---|
| Alaska | No income or sales tax; permanent fund dividend |
| Florida | No income tax; 6% sales tax |
| Nevada | No income tax; no corporate income tax |
| New Hampshire* | No tax on wages; 3% on interest/dividends (phasing out by 2027) |
| South Dakota | No income tax; no corporate income tax |
| Tennessee* | No tax on wages; Hall Tax on interest/dividends fully repealed 2021 |
| Texas | No income tax; 6.25% sales tax; high property taxes |
| Washington** | No income tax on wages; 7% capital gains tax on gains over $270,000 |
| Wyoming | No income or corporate income tax |
*NH phases out interest/dividend tax by 2027. Tennessee repealed its investment income tax in 2021. **Washington’s capital gains tax (7% on gains >$270K) is classified as an excise tax by the state.
All 50 States: Top Marginal Rate and Effective Rate
Ranked from highest to lowest top marginal rate. Effective rate calculated on $100,000 taxable income (single filer, standard deduction, 2026 projected).
| Rank | State | Top Marginal Rate | Effective Rate on $100K | Structure |
|---|---|---|---|---|
| 1 | California | 13.30% | ~7.2% | Progressive (9 brackets) |
| 2 | Hawaii | 11.00% | ~7.0% | Progressive (12 brackets) |
| 3 | New Jersey | 10.75% | ~5.5% | Progressive (7 brackets) |
| 4 | Oregon | 9.90% | ~7.8% | Progressive (4 brackets) |
| 5 | Minnesota | 9.85% | ~6.5% | Progressive (4 brackets) |
| 6 | New York | 9.65%* | ~5.8% | Progressive (9 brackets) |
| 7 | Vermont | 8.75% | ~5.5% | Progressive (4 brackets) |
| 8 | District of Columbia | 8.95% | ~6.0% | Progressive (7 brackets) |
| 9 | Iowa | 5.70% | ~4.8% | Progressive (4 brackets, reduced) |
| 10 | Wisconsin | 7.65% | ~5.3% | Progressive (4 brackets) |
| 11 | Maine | 7.15% | ~5.5% | Progressive (3 brackets) |
| 12 | South Carolina | 6.40% | ~4.5% | Progressive (6 brackets, phasing down) |
| 13 | Connecticut | 6.99% | ~5.0% | Progressive (7 brackets) |
| 14 | Montana | 5.90% | ~4.8% | Progressive (2 brackets, reformed) |
| 15 | Nebraska | 5.84% | ~4.8% | Progressive (4 brackets, phasing down) |
| 16 | Delaware | 6.60% | ~4.8% | Progressive (7 brackets) |
| 17 | Idaho | 5.80% | ~5.0% | Flat (reduced from progressive) |
| 18 | West Virginia | 5.12% | ~4.2% | Progressive (5 brackets, phasing down) |
| 19 | Arkansas | 4.40% | ~3.8% | Progressive (3 brackets, reduced) |
| 20 | Kansas | 5.70% | ~4.3% | Progressive (3 brackets) |
| 21 | Louisiana | 4.25% | ~3.5% | Progressive (3 brackets, reformed) |
| 22 | Maryland | 5.75% | ~4.5% | Progressive (8 brackets) + county tax |
| 23 | Virginia | 5.75% | ~4.5% | Progressive (4 brackets) |
| 24 | Rhode Island | 5.99% | ~4.0% | Progressive (3 brackets) |
| 25 | Massachusetts | 5.00% | ~5.0% | Flat (+ 4% surtax on income >$1M) |
| 26 | New Mexico | 5.90% | ~3.8% | Progressive (5 brackets) |
| 27 | Alabama | 5.00% | ~3.8% | Progressive (3 brackets) |
| 28 | Mississippi | 5.00% | ~3.5% | Progressive (2 brackets, phasing down) |
| 29 | Missouri | 4.80% | ~3.8% | Progressive (10 brackets, phasing down) |
| 30 | Georgia | 5.39% | ~4.5% | Flat (transitioned from progressive 2025) |
| 31 | Oklahoma | 4.75% | ~3.8% | Progressive (6 brackets) |
| 32 | Ohio | 3.50% | ~2.8% | Progressive (simplified 2 brackets) |
| 33 | Utah | 4.65% | ~4.65% | Flat |
| 34 | Kentucky | 4.00% | ~4.0% | Flat |
| 35 | Michigan | 4.25% | ~4.0% | Flat |
| 36 | Indiana | 3.05% | ~3.05% | Flat + county |
| 37 | Colorado | 4.40% | ~4.4% | Flat |
| 38 | Illinois | 4.95% | ~4.95% | Flat |
| 39 | Pennsylvania | 3.07% | ~3.07% | Flat |
| 40 | North Carolina | 4.50% | ~4.5% | Flat (phasing down to 2.49% by 2030) |
| 41 | Arizona | 2.50% | ~2.5% | Flat |
| 42 | North Dakota | 1.95% | ~1.5% | Progressive (2 brackets) |
| 43-50 | AK, FL, NV, NH, SD, TN, TX, WA, WY | 0% | 0% | No income tax |
*New York rate includes the NYC resident tax (3.078-3.876%) for New York City residents — effective top rate can exceed 13%.
Source: Tax Foundation — State Individual Income Tax Rates 2026
Flat Tax vs. Progressive Tax: What It Means for You
Flat tax states (IL, IN, MI, PA, CO, UT, NC, KY, AZ, GA, ID, etc.) charge the same rate regardless of income. A flat 4.95% in Illinois means someone earning $50,000 and someone earning $500,000 both pay 4.95%.
Progressive tax states (CA, NY, NJ, OR, MN, etc.) apply increasing rates at higher income levels. California’s top 13.3% rate only kicks in on income above $1 million — a resident earning $100,000 pays an effective rate of approximately 7.2%.
For high earners: Flat-tax states are generally more favorable because the rate does not increase with income. California’s effective rate at $500,000 is approximately 9.3% vs. Illinois at 4.95%.
For moderate earners: Progressive states with low starting brackets can be comparable to or better than some flat-tax states. New York’s effective rate on $60,000 is approximately 4.5% — lower than Illinois’ flat 4.95%.
Retirement-Friendly States
Retirees have different tax considerations. These states exempt most or all retirement income from state tax:
| State | Social Security Taxed? | Pension Taxed? | IRA/401(k) Taxed? |
|---|---|---|---|
| Florida | No income tax | No income tax | No income tax |
| Texas | No income tax | No income tax | No income tax |
| Nevada | No income tax | No income tax | No income tax |
| Wyoming | No income tax | No income tax | No income tax |
| Alaska | No income tax | No income tax | No income tax |
| Pennsylvania | No | No (if retirement age) | No (if retirement age) |
| Mississippi | No | No | No |
| Illinois | No | No | No |
| Iowa | No (phased out) | Partial exclusion | Partial exclusion |
States that tax Social Security (at least partially): Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, Vermont, West Virginia (some with income-based exemptions).
For retirement planning context, see Retirement Tax Planning.
The Total Tax Picture: Income Tax Is Not Everything
State income tax is only one variable. Total state and local tax burden includes sales tax, property tax, and excise taxes:
| State | Income Tax | Sales Tax | Median Property Tax Rate | Overall Rank |
|---|---|---|---|---|
| Texas | 0% | 6.25% (+local) | ~1.60% | High property tax offsets no income tax |
| Florida | 0% | 6.00% (+local) | ~0.80% | Low overall burden |
| California | 13.3% max | 7.25% (+local) | ~0.71% | High income and sales, low property |
| New York | 9.65% max | 4.00% (+local) | ~1.40% | High across all categories |
| Washington | 0%* | 6.50% (+local) | ~0.87% | Capital gains tax + high sales |
| Illinois | 4.95% flat | 6.25% (+local) | ~2.07% | Highest property taxes in nation |
| New Hampshire | 0%** | 0% | ~1.57% | Very high property taxes |
Effective total burden varies dramatically based on income level, home value, and spending patterns. A retiree with low income but a high-value home pays less in California and more in Texas than the income tax ranking suggests.
Domicile Rules: Moving to Avoid State Tax
Simply claiming a new address does not change your state tax domicile. States aggressively audit domicile changes, particularly from high-tax states (CA, NY, NJ). To establish a new domicile:
- Spend 183+ days per year in the new state
- Register to vote, get a driver’s license, register vehicles
- Move primary banking relationships
- Update your address with the IRS, USPS, and all financial institutions
- Maintain a home in the new state (ideally sell or rent the old one)
- Keep a contemporaneous log of days spent in each state
Warning: California and New York are known for aggressive audits of residents who claim to have moved. If you maintain significant ties (home, business, family), they may classify you as a part-year or full-year resident regardless of your claimed domicile.
Key Takeaways
- Nine states impose no income tax on wages, though some offset this with higher property or sales taxes
- California (13.3%), Hawaii (11%), and New Jersey (10.75%) have the highest top marginal rates, but effective rates at $100,000 income are roughly 5-8%
- Flat-tax states generally benefit high earners; progressive-tax states can be favorable for moderate earners
- Retirement-friendly states like Florida, Texas, Pennsylvania, Mississippi, and Illinois exempt all or most retirement income
- Total tax burden (income + sales + property) matters more than income tax rate alone — Florida and Wyoming rank among the lowest overall
Next Steps
- Use the Tax Bracket Calculator to model your federal and state tax liability
- Read Capital Gains Tax Rates 2026 for state-level capital gains considerations
- Explore Retirement Tax Planning for state tax in retirement
- See Tax Planning Strategies for the full tax reduction playbook
This content is for educational purposes only and does not constitute financial or tax advice. State tax laws change frequently. Consult a licensed tax professional for your specific situation.
Sources
- Tax Foundation — State Individual Income Tax Rates 2026 — accessed April 2026
- IRS — Tax Inflation Adjustments for 2026 — accessed April 2026
- Tax Foundation — State and Local Tax Burden Rankings — accessed April 2026
- SSA.gov — Retirement Benefits — accessed April 2026
About This Article
Researched and written by the iAdviser editorial team using official sources. This article is for informational purposes only and does not constitute professional advice.
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