The Old Line state not only has a few of the highest taxes in the U. Delaware is No. To the south, Virginia has one of the lowest gas taxes at just 21 cents per gallon, compared to Maryland's 35 cents. Kiplinger in particular focused on income tax in Maryland.
On the high end, 5. The most equitable states in the nation — the ones with tax systems in which top earners pay more — are California, Delaware, Maine, Maryland, Minnesota, Montana, New Jersey, New York, Oregon, and Vermont, according to the analysis. According to the report :.
The main finding of this report is that the vast majority of state and local tax systems are fundamentally unfair. An overreliance on consumption taxes and the absence of a progressive personal income tax in many states neutralizes whatever benefits the working poor receive from refundable low-income tax credits.
It should be noted that, according to The Tax Foundation , this report is overwhelmingly a measure of the progressivity of the individual income tax, and not of the tax code as a whole.
The ITEP study looks at income, sales and excise, and property taxes. It omits a range of taxes which tend to be highly progressive that is, falling more heavily on higher-income individuals , like inheritance and estate taxes, real estate transfer taxes, leasehold taxes, and insurance premium taxes. Our survey also shows that the average property tax rate in the Hawkeye State is the 11th-highest in the nation. That certainly doesn't help middle-class families in Iowa. While sales taxes in Iowa aren't low, at least they're not as high as the state's income and property taxes.
That puts Iowa's combined average state and local sales tax rate 6. The Constitution State is an expensive place to live. Connecticut's property taxes are the third-highest in the U.
State income taxes on are the high end, too. Connecticut income taxes for our make-believe middle-class are above average , but not sky high. Sales taxes are also reasonable in Connecticut. There are no local sales taxes in Connecticut, so you'll pay only the statewide rate of 6. Sorry, Illinois, but you're the least tax-friendly state in the country for middle-class families.
For all three taxes we're tracking — income, sales, and property taxes — you tax middle-income residents at an above average rate at least. And for one of those taxes, the rates are extremely high. That's enough to put the Land of Lincoln in the most undesirable spot on our list.
At first blush, the state's 4. And that's true if you're talking about wealthy residents. But for middle-class taxpayers, the income tax rate is on the high end. Also note that Illinois voters rejected a proposal on the November ballot that would have dumped the flat tax in favor of a graduated income tax. If it had passed, the marginal tax rate for most middle-income residents would have dropped slightly to 4. Sales taxes in Illinois are high, too. There's a 6.
Plus, up to 4. All told, the average combined state and local sales tax in Illinois is 8. The tax situation really goes downhill fast for Illinois residents when you look at the property taxes they have to pay. Property taxes in Illinois are the second-highest in the nation.
Our tax maps and related tax content include data from a wide range of sources. To generate our rankings, we created a metric to compare the tax burden in all 50 states and the District of Columbia. Income tax — Our income tax information comes from each state's tax agency. Income tax forms and instructions were also used. See more about how we calculated the income tax for our hypothetical family below under "Ranking method.
Property tax — The median property tax rate is based on the median property taxes paid and the median home value in each state for the most recent year available.
The data comes from the U. Census Bureau. Sales tax — State sales tax rates are from each state's tax agency. We also cite the Tax Foundation's figure for average combined sales tax, which is a population-weighted average of state and local sales taxes. In states that let local governments add sales taxes, this gives an estimate of what most people in a given state actually pay, as those rates can vary widely.
The "tax-friendliness" of a state depends on the sum of income, sales and property tax paid by our hypothetical family. Since some states have local income taxes, we domiciled our filers in each state's capital, from Juneau to Cheyenne. We calculated these returns using software from Credit Karma. How much they paid in sales taxes was calculated using the IRS' Sales Tax Calculator , which is localized to zip code.
To determine those, we used Zillow to determine zip codes with housing inventory close to our sample assessed value. Skip to header Skip to main content Skip to footer.
Home taxes state tax. Michigan Getty Images. Nebraska Getty Images. Maryland Getty Images.
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