In this article, we will look into the 25 most taxed states in the US. If you want to skip our detailed analysis, you can go directly to the 5 Most Taxed States in the US.
US Tax Outlook for 2024
The US tax revenue is a major contributor to the country’s economic growth. In fiscal year 2024, the US federal government has generated a total tax revenue of $1.58 trillion so far. Personal income taxes have the highest share in the total collected revenue, accounting for 50.96%, followed by social security and Medicare share of 33.68% of the tax revenue. For 2024, the minimum income tax rate is 10%, applicable to incomes of $11,600 or less. The maximum rate is 37% for the tax year 2024. The maximum rate applies to incomes ranging from $609,350 to $731,200 for individuals and married couples filing jointly, respectively.
On March 11, Reuters reported that the US government budget proposed by President Joe Biden would raise tax receipts by $4.95 trillion over 10 years. This also includes tax hikes of more than $2.7 trillion on businesses and $2 trillion on wealthy individuals and estates. According to the US Treasury’s estimates, new tax hikes rules for wealthy individuals, estates, and high-income individuals would raise $1.96 trillion.
Despite the proposed hikes for businesses, the IRS offers plenty of tax havens. Recently on January 31, Reuters reported that the US House of Representatives also passed a $78 billion tax relief to alleviate tax burdens. To learn more about the tax write-offs offered by the IRS, you can take a look at the best tax deductions for small businesses.
Tax Services Providers in the US
Some of the leading companies providing tax services in the US include CBIZ, Inc. (NYSE:CBZ), Intuit Inc. (NASDAQ:INTU), and H&R Block, Inc. (NYSE:HRB).
CBIZ, Inc. (NYSE:CBZ) is one of the leading tax services providers in the country. Its tax advisory and consultation services cater to business tax, state or local tax, sales tax, and tax filing solutions. On February 7, the company announced the acquisition of the leading tax and accounting services provider in Colorado, Erickson, Brown & Kloster (EBK). This transaction by CBIZ, Inc. (NYSE:CBZ) will help expand its business in the state. EBK will provide benefits to the company with its highly qualified workforce and annual revenue of $8.9 million.
Intuit Inc. (NASDAQ:INTU) is a leading software company that provides tax and business solutions via its platforms, TurboTax, Credit Karma, Mailchimp, and QuickBooks. On January 8, the company announced that members of its financial platform, Credit Karma, can now file their taxes through its tax services engine, TurboTax within the platform. TurboTax provides assisted and DIY tax preparation services to private and commercial customers. Online customers of Quickbooks can also use TurboTax to file taxes. The integration of Intuit Inc.’s (NASDAQ:INTU) software will utilize the AI capabilities of the company along with its exceptional tax knowledge engine to help its customers file taxes.
H&R Block, Inc. (NYSE:HRB) is one of the top tax services providers in the country. The company provides tax filing services via its software platform, as well as personal assistance and online tax filing. On December 14, the company announced the launch of its AI tax assistant, called H&R Block AI Tax Assist. The generative AI tool has been developed to help customers, including individuals and businesses, file taxes smoothly. The tax assistant boasts a robust information engine to help tax filers streamline their taxes.
These companies can help filers understand their taxes and fully benefit from the applicable tax deductions. With this context, let’s have a look at the 25 most taxed states in the US. You can also check out 15 States with No Income Tax and 10 States That Tax Social Security in 2024.
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Methodology
In order to compile our list of the 25 most taxed states in the US, we utilized top individual income tax, sales tax, and property taxes paid as a percentage of owner-occupied housing value in 2024 data of US states, sourced from the Tax Foundation. We have used the personal income tax rate as our primary metric to rank the most taxed states in the US. The list ranks the states in ascending order of their personal income tax. We have also listed the property and sales tax for each state on our list, and have used them as tie-breakers for similar personal income rates.
25 Most Taxed States in the US
25. Alabama
Income Tax Rate (2024): 5%
Sales Tax Rate (2024): 4%
Property Tax Rate (2024): 0.4%
Alabama is ranked among the most taxed states in the US. As of 2024, the top individual income tax rate of the state is 5%, and the property tax paid as a percentage of owner-occupied housing value is 0.4%.
24. Georgia
Income Tax Rate (2024): 5.49%
Sales Tax Rate (2024): 4%
Property Tax Rate (2024): 0.92%
Georgia is ranked 14th on our list. The state has a top individual income tax rate of 5.49% and a property tax of 0.92%, as of 2024.
23. Iowa
Income Tax Rate (2024): 5.7%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 1.52%
Iowa is one of the most taxed US states. It has a 1.52% property tax paid as a percentage of owner-occupied housing value and a 5.7% top individual income tax. The sales tax in the state is 6%, as of 2024.
22. Kansas
Income Tax Rate (2024): 5.7%
Sales Tax Rate (2024): 7%
Property Tax Rate (2024): 1.34%
Kansas has an income tax rate of 5.7% and a sales tax of 5%. Its property tax paid as a percentage of owner-occupied housing value is 1.34%. Kansas is ranked 22nd on our list.
21. Virginia
Income Tax Rate (2024): 5.75%
Sales Tax Rate (2024): 5%
Property Tax Rate (2024): 0.87%
Virginia is one of the states with the highest tax rates in the US. As of 2024, the state has a top individual income tax rate of 5.75% and a sales tax of 5%.
20. Maryland
Income Tax Rate (2024): 5.75%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 1.05%
Maryland has property tax paid as a percentage of owner-occupied housing value of 1.05%. Its sales and income taxes are 6% and 5.75% respectively, as of 2024.
19. Idaho
Income Tax Rate (2024): 5.8%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 0.67%
Idaho is one of the most taxed states in the US. The top individual income tax is 5.8%, and the sale and property taxes are 0.67% and 6%, respectively.
18. Nebraska
Income Tax Rate (2024): 5.84%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 1.63%
Nebraska ranks 18th on our list of the most taxed states in the US. As of 2024, the state’s income tax is 5.84%, and the sales tax is 6%.
17. Montana
Income Tax Rate (2024): 5.9%
Sales Tax Rate (2024): 0%
Property Tax Rate (2024): 0.74%
Montana has a top individual income tax rate of 5.9% and a property tax paid as a percentage of owner-occupied housing value of 0.74%. It is one of the most taxed US states.
16. New Mexico
Income Tax Rate (2024): 5.9%
Sales Tax Rate (2024): 5%
Property Tax Rate (2024): 0.67%
New Mexico is ranked 16th on our list. As of 2024, the sales and income tax rates of the state are 5% and 5.9%, respectively.
15. Rhode Island
Income Tax Rate (2024): 5.99%
Sales Tax Rate (2024): 7%
Property Tax Rate (2024): 1.4%
Ranked 15th on our list, Rhode Island has a property tax paid as a percentage of owner-occupied housing value of 1.4%. The top individual income tax of the state is 5.99%.
14. South Carolina
Income Tax Rate (2024): 6.4%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 0.57%
South Carolina is one of the most taxed US states. As of 2024, the top individual income tax rate in the state is 6.4%.
13. West Virginia
Income Tax Rate (2024): 6.5%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 0.57%
West Virginia is ranked 13th on our list. The top individual income tax rate of the state is 6.5%. The sales and property taxes are 6% and 0.57% respectively.
12. Delaware
Income Tax Rate (2024): 6.6%
Sales Tax Rate (2024): 0%
Property Tax Rate (2024): 0.61%
Delaware is one of the most taxed states in the US. As of 2024, the income tax rate of the state is 6.6%, and property tax is 0.61%.
11. Connecticut
Income Tax Rate (2024): 6.99%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 1.79%
Connecticut has a 1.79% property tax paid as a percentage of owner-occupied housing value. As of 2024, the top individual income and sales tax rates of the states are 6.99% and 6%, respectively.
10. Maine
Income Tax Rate (2024): 7.15%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 1.24%
As of 2024, Maine’s top individual income tax rate is 7.15%, and its property tax is 1.24%, making it one of the most taxed states in the US.
9. Wisconsin
Income Tax Rate (2024): 7.65%
Sales Tax Rate (2024): 5%
Property Tax Rate (2024): 1.61%
Wisconsin ranks 9th on our list. The property tax paid as a percentage of owner-occupied housing value in the state is 1.61%. The top individual income tax in Wisconsin is 7.65%.
8. Vermont
Income Tax Rate (2024): 8.75%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 1.83%
Vermont has a property tax paid as a percentage of owner-occupied housing value and a top individual tax of 8.75%. It is one of the most taxed states in the US.
7. Massachusetts
Income Tax Rate (2024): 9%
Sales Tax Rate (2024): 6%
Property Tax Rate (2024): 1.14%
Massachusetts is ranked 7th on our list. The state has an income tax rate of 9% and a property tax rate of 1.14, as of 2024.
6. Minnesota
Income Tax Rate (2024): 9.85%
Sales Tax Rate (2024): 7%
Property Tax Rate (2024): 1.11%
Minnesota has a property tax paid as a percentage of owner-occupied housing value of 1.11% and a top individual income tax rate of 9.85%. It is ranked 6th on our list of the most taxed states in the US.
Click here to see 5 Most Taxed States in the US.
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Disclosure: None. 25 Most Taxed States in the US is originally published on Insider Monkey.