Personal Finance

Residents of New York pay the most in income tax, Connecticut is second

By March 27, 2019 No Comments

Start spreading the news: New Yorkers are coughing up the most cash in state income taxes.

Tennessee and New Hampshire don’t tax wages, but they do so on income from interest and dividends.

See below for a map of where your state ranks with respect to income tax, according to data from the Tax Foundation.

Income taxes make a significant contribution to states’ coffers. Nearly 40 percent of state tax collections come from levies on your wages, according to the foundation.

If you’re thinking of fleeing to a place with a lower or no income tax, remember that states need to get their revenue from somewhere.

“There are other taxes that matter, including sales and property taxes,” said Katherine Loughead, policy analyst at the foundation.

“The state estate tax can factor in for a lot of people as to whether they’ll be taxed at high rates if they pass their estate along to their heirs.”

Here’s an example: New Hampshire won’t levy your wages, yet the Granite State imposes some of the highest state and local property taxes per capita — $3,115, the Tax Foundation found.

Further, some localities have their own income levies. This means that while the state you move to matters, so does the city or town in which you work or reside.

“Local taxes can really depend on whether you live in an urban environment versus rural,” said Loughead.

More from Personal Finance:
Where to draw the line when getting your kid into college
Michael Avenatti allegedly made this tax slip-up
Why millennials aren’t buying homes

Subscribe to CNBC on YouTube.

Read More…

creditdispute.ca