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We've put together a lot of information on federal income tax brackets, so here were going to add to the income tax story with a listing of state income tax rates. Keep in mind that state income tax is not the end of your tax bill, because property tax and sales tax are used to pay for essential services too.
State Income Taxes
In fact, that brings us to the pros and cons of taxes of any kind. If your state collects income taxes, the money is paying for services such as state-run programs, which help the less fortunate. The state government has several options to fund such programs, and state income taxes are a common source of funding.
Sources and Uses of Government Funding
In many states, income taxes are one of the primary sources of educational funding as well as funding for many essential services such as police and fire protection. For example, half the money needed to run your town's high school might come from state income taxes and the other half from property taxes.
If you live in a state where the property taxes are low, the income tax rate is low, and sales tax is reasonable, then something has to suffer. In this example, it's probably the quality of the educational system in your particular state.
State Income Tax Tables
The state income tax tables also help to explain why some states are popular as retirement communities. For example, Florida is popular with senior citizens not only because of the climate, but also there is no state income tax. On the other hand, despite the fact that Nevada has no state income tax, they've a large gambling industry that does pay taxes. So the table can be misleading at times, especially if there is a dominant industry in the state.
State Income Tax Trivia
Before we get to the tax rates, we'd like to share some state income tax trivia.
- There are currently seven states that do not collect any state income taxes: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming.
- There are two states that only collect income taxes on dividends and interest income: New Hampshire and Tennessee.
- Hawaii and Oregon have the highest incremental state tax rate: 11.0%.
- Seven states have only one income tax bracket, charging its residents one rate on all income, which is called a flat rate: Colorado (4.63%), Illinois (5.0%), Indiana (3.4%), Massachusetts (5.3%), Michigan (4.35%), Pennsylvania (3.07%) and Utah (5.0%).
- Hawaii also has the largest number of tax brackets (12), ranging from 1.4 to 11.0%.
State Income Tax Tables
State income tax tables are like federal income tax rates, but putting them all in one place is a challenge. That's because the number of tax brackets, the ranges of income, and the tax rates themselves vary from state to state. If you want an at-a-glance view of the income taxes for each state, then take a look at the table below.
Individual State Income Tax Rates 2011
| State |
Tax Rate |
Brackets |
Bracket Range |
| Alabama |
2.0 - 5.0% |
3 |
$500 - 3,000 |
| Alaska |
None |
|
|
| Arizona |
2.59 - 4.54% |
5 |
$10,000 - 150,000 |
| Arkansas |
1.0 - 7.0% |
6 |
$3,899 - 32,700 |
| California |
1.0 – 9.3% |
6 |
$7,124 – 46,767 |
| Colorado |
4.63% |
1 |
Flat Rate |
| Connecticut |
3.0 – 6.5% |
3 |
$10,000 - 500,001 |
| Delaware |
2.2 - 6.95% |
6 |
$5,000 - 60,001 |
| Florida |
None |
|
|
| Georgia |
1.0 - 6.0% |
6 |
$750 - 7,000 |
| Hawaii |
1.4 – 11.0% |
12 |
$2,400 - 200,001 |
| Idaho |
1.6 - 7.8% |
8 |
$1,315 - 26,320 |
| Illinois |
5.0% |
1 |
Flat Rate |
| Indiana |
3.4% |
1 |
Flat Rate |
| Iowa |
0.36 –8.98% |
9 |
$1,439 - 64,756 |
| Kansas |
3.5 - 6.45% |
3 |
$15,000 - 30,000 |
| Kentucky |
2.0 - 6.0% |
6 |
$3,000 - 75,000 |
| Louisiana |
2.0 - 6.0% |
3 |
$12,500 - 50,000 |
| Maine |
2.0 - 8.5% |
4 |
$4,949 - 19,750 |
| Maryland |
2.0 – 5.5% |
7 |
$1,000 – 500,000 |
| Massachusetts |
5.3% |
1 |
Flat Rate |
| Michigan |
4.35% |
1 |
Flat Rate |
| Minnesota |
5.35 - 7.85% |
3 |
$22,700 - 74,781 |
| Mississippi |
3.0 - 5.0% |
3 |
$5,000 - 10,000 |
| Missouri |
1.5 - 6.0% |
10 |
$1,000 - 9,000 |
| Montana |
1.0 - 6.9% |
7 |
$2,600 - 15,601 |
| Nebraska |
2.56 - 6.84% |
4 |
$2,400 - 27,001 |
| Nevada |
None |
|
|
| New Hampshire |
Dividend and Interest Income Only |
|
|
| New Jersey |
1.4 – 8.97% |
6 |
$20,000 – 500,000 |
| New Mexico |
1.7 – 4.9% |
4 |
$5,500 - 16,000 |
| New York |
4.0 – 8.97% |
7 |
$8,000 - 500,000 |
| North Carolina |
6.0 - 7.75% |
3 |
$12,750 - 60,000 |
| North Dakota |
1.84 - 4.86% |
5 |
$34,000 - 373,651 |
| Ohio |
0.587 – 5.93% |
9 |
$5,050 - 200,000 |
| Oklahoma |
0.5 - 5.5% |
7 |
$1,000 - 8,701 |
| Oregon |
5.0 - 11.0% |
5 |
$2,000 – 250,000 |
| Pennsylvania |
3.07% |
1 |
Flat Rate |
| Rhode Island |
3.75– 5.99 |
3 |
$55,000 – 125,001 |
| South Carolina |
0.0 - 7.0% |
6 |
$2,740 - 13,701 |
| South Dakota |
None |
|
|
| Tennessee |
6.0% |
1 |
Dividend and Interest Income Only |
| Texas |
None |
|
|
| Utah |
5.0% |
1 |
Flat Rate |
| Vermont |
3.55 – 8.95% |
5 |
$34,000 - 373,651 |
| Virginia |
2.0 - 5.75% |
4 |
$3,000 - 17,000 |
| Washington |
None |
|
|
| West Virginia |
3.0 - 6.5% |
5 |
$10,000 - 60,000 |
| Wisconsin |
4.6 – 7.75% |
5 |
$10,000 - 221,661 |
| Wyoming |
None |
|
|
| District of Columbia |
4.0 - 8.5% |
3 |
$10,000 - 40,000 |
About the Author - State Income Tax Rates
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