Can your personal income tax take a considerable hit depending on where you live?

A personal finance website examined the proportion of total personal income residents in the 50 states pay toward local and state taxes. This is their tax burden, which varies from the tax rates imposed on them based on their circumstances.

For instance, the typical resident of a low-income state with a 7% sales tax pays a larger share of income in sales taxes than that of a high-income state with the same sales tax rate.

The study found that the tax burden is not the same across the US. Still, all states have a form of property and excise taxes. Yet it’s easy to be alarmed at tax time when you see just how much of your income you lose.

To determine which states tax their residents most and least aggressively, experts collected data from the Tax Policy Center as of March 4th and compared personal income tax, property tax, and total excise and sales tax as a share of personal income in each state.

Researchers then added the results to get the overall tax burden for each state. So where does YOUR state fall? Continue reading for the 9 states with the highest personal income tax.

What are the worst states for personal income tax in America? (7%+)

The states with a high tax status generally surpass 7% at their top bracket. Some climb well into the double digits. These are usually labeled as the “worst states for personal tax” if you focus on rate alone. Here are the states:

-California: Tops out at 13.3% for high earners (plus a 1% surcharge on incomes over $1 million).

-Hawaii: Just adjusted brackets but kept an 11% rate on income over $325k.

-New York: Has brackets reaching 10.9% on ultra‑high earners above $25 million.

-New Jersey: 10.75% top bracket for incomes over $5 million.

-Oregon: 9.9% for incomes over ~$125k (although no state sales tax).

-Minnesota: The top rate of 9.85% starts at about $193k for singles. Extra surcharges could be added on specific capital gains.

-Vermont: Has a top rate of 8.75% at about $225k. It’s known for its limited bracket width and a “marriage penalty.”

-Wisconsin: 7.65% top bracket, no major cuts for top earners yet.

-Maine: 7.15% top bracket, a fairly modest $58k.

Note: These “states with high tax burdens” depend more on progressive systems. For example, New York and California have multiple brackets that climb steeply as income rises, and local governments, including NYC, can tack on their personal income taxes.

Whether these states genuinely count as the “worst” might depend on the range of public services they provide, but just by state income tax rates, they rank among the highest.

States with moderate personal income tax rates (4–6%)

Most of the country is moderate, with roughly 4–6% at the top bracket. Some states have flat taxes, while others use graduated rates of around 5 or 6%. Here’s how they break down:

Flat-Tax States (4–6%)

-Kentucky (4.0%): Recently cut its flat rate from 5% to 4%. More reductions might follow.

-North Carolina (4.25%): On a stable glide path down from over 5% a couple of years ago, striving for sub-4% soon.

-Colorado (4.4%): This rate turns slightly yearly due to revenue triggers but stays around 4.4%.

-Michigan (4.25%) – Temporarily dropped to 4.05% in 2023. Otherwise holds steady at 4.25%.

-Illinois (4.95%): Voters refused a progressive tax proposal. So, the rate remains flat at 4.95%.

-Utah (4.55%): Cut from 4.65% in 2024.

-Georgia (5.39%): Transitioning to a flat tax, stepping down slowly from higher rates.

-Mississippi (4.4%): Consolidating brackets over $10k of income. Scheduled to move under 4% soon.

-Iowa (3.8% in 2025): Aiming for under 4% by 2026, dropping from a top rate above 8%.

Progressive-Tax States (4–6% Top Rates)

-Missouri (Top ~4.7%): Gradually cutting its highest bracket through automatic triggers.

-Oklahoma (Top ~4.75%): Several brackets up to 4.75%.

-Kansas (Top ~5.58%): The brackets merged recently. The top bracket begins at $15k income.

-Nebraska (Top ~5.20%): Has aggressively cut rates en route to ~4% in a few years.

-New Mexico (Top 5.90%): Multiple brackets; 5.9% applies only to higher incomes.

-South Carolina (~6.2–6.5%): Transitioning from 7% to about 6%.

-Virginia (5.75%): This state’s top rate is at a low-income threshold ($17k). So, most filers pay 5.75% on most of their earnings.

-Delaware (6.60%): This state doesn’t have a sales tax and leans more on personal income tax, with a top rate near 6.6%.

-Montana (6.75%): There are essentially two brackets: 4.7% for lower incomes and 6.75% for higher earners.

-Idaho (~5.695%): Moving toward a single rate in practice.

-Ohio (Top 3.99%): Numerous brackets but a lower top rate, making it relatively competitive.

-Alabama (5%): Technically, there are brackets up to 5%, though the top bracket applies to almost all income over $3k.

-Arkansas (4.4%): Cut from nearly 6% down to the mid‑4% range recently.

-Massachusetts (5% on most income; 9% on income above $1M): Usually known for its flat 5% tax, but added a 4% surtax on seven‑figure incomes. This virtually places millionaires at nearly 9%.

Note: Due to the fact that many states in this category are phasing in rate reductions, people may see gradual changes yearly. According to various state legislatures, 28 states have slashed their personal income tax rates since 2021.

For example, West Virginia was in the 6.5% range but fell to around 5.1%, with possible further cuts on deck. Massachusetts stands out for imposing a second layer of tax—4%—on incomes above $1 million, sending those specific earners’ marginal rate to 9%.

States with very low personal income tax rates (1–3%)

A bunch of tax-friendly states impose minimal rates of about 1–3%. Even though not at 0%, they come close to that area and contend for residents who want low-tax states without giving up state services completely. Here are the states:

-Arizona: Flat 2.5% rate for all earners, one of the lowest in the nation.

-North Dakota: Top bracket close to 2.5% in 2025, down from higher rates a couple of years ago. Even high earners rarely surpass 2.5%.

-Indiana: Currently at 3.0% flat, dropping from 3.15%. Further cuts could bring it under 3% soon.

-Louisiana: Recently collapsed brackets into a 3.0% flat tax, a sharp reduction from its prior 4.25% top rate.

-Pennsylvania: Maintains a 3.07% flat rate, unchanged for decades.

Note: In certain scenarios, these states are almost as appealing as states without personal income taxes. Many of these “1–3% group” states moved toward flat, simplified systems during a wave of reforms at the start of 2020.

Which states have no personal income taxes in 2025?

Some states opt out of personal income taxes altogether. As of 2025, 8 states are at a 0% rate:

-Alaska: Funds services partly via oil revenues.

-Florida: Banned passing a state income tax under its constitution.

-Nevada: Relies heavily on sales taxes and tourism for revenue.

-South Dakota: Foregoes income tax, assisted by other revenue channels and a smaller population.

-Tennessee: Officially ended its tax by 2021.

-Texas: Banned state income tax in its constitution. Compensates with higher sales and property taxes.

-Washington: No wage tax, although a 7% capital gains tax applies over a specific threshold.

-Wyoming: It depends on energy and mineral taxes.

-New Hampshire: As of January 1 this year, it no longer taxes dividends or interest. Now, there’s no personal income tax at all.

Note: These no-income tax states usually end up on the “best states for personal tax” lists. Just remember that states without any income taxes might offset that revenue shortfall with higher property or sales taxes.

Do you live in a state with high personal income taxes? Please feel free to share your thoughts in the comments section below.

But don’t leave yet! If you found this article interesting, you might want to also check out: 8 Major Household Costs Spiking This Year