NewsNation

Study ranks how ‘tax-friendly’ every state is

An analysis by MoneyGeek shows the tax-friendliness of every U.S. state. (Photo: MoneyGeek)

(NEXSTAR) – It’s tax filing season and depending on where you live in the U.S., you could be forking over a very different-sized chunk of your income.

An analysis by MoneyGeek ranked every state by how “tax-friendly” it is. The analysts didn’t just look at income tax – they also factored in property taxes, plus state and local sales taxes.


To determine where people pay the highest tax burden, MoneyGeek looked at a hypothetical average family: a married couple with one kid, earning the median national income of $82,852, owning a $349,400 home. The study breaks down how much this fictional family would pay in taxes in every state.

The states with the lowest tax burden, according to the analysis, were:

  1. Wyoming (estimated taxes: 4% of income or $3,279)
  2. Nevada (estimated taxes: 4.7% of income or $3,879)
  3. Alaska (estimated taxes: 5.4% of income or $4,507)
  4. Florida (estimated taxes: 5.6% of income or $4,632)
  5. Tennessee (estimated taxes: 6.5% of income or $5,377)
  6. Washington (estimated taxes: 6.5% of income or $5,414)
  7. North Dakota (estimated taxes: 6.7% of income or $5,556)
  8. Arizona (estimated taxes: 6.8% of income or $5,665)
  9. South Dakota (estimated taxes: 7.2% of income or $5,938)
  10. Delaware (estimated taxes: 7.3% of income or $6,074)

The states with the highest tax burden were:

  1. Illinois (estimated taxes: 16.8% of income or $13,894)
  2. Connecticut (estimated taxes: 15.1% of income or $12,545)
  3. New Jersey (estimated taxes: 14.3% of income or $11,872)
  4. New Hampshire (estimated taxes: 14.1% of income or $11,694)
  5. New York (estimated taxes: 13.9% of income or $11,495)
  6. Iowa (estimated taxes: 13.8% of income or $11,398)
  7. Wisconsin (estimated taxes: 13.2% of income or $10,976)
  8. Vermont (estimated taxes: 12.6% of income or $10,453)
  9. Nebraska (estimated taxes: 12.6% of income or $10,446)
  10. Michigan (estimated taxes: 12.4% of income or $10,239)

Based on its analysis, MoneyGeek also gave every state a letter grade on its “tax friendliness.” The states with A grades have the lowest tax burden on an “average” family, while the states with D or E grades have the highest tax burden.

MoneyGeek’s estimates only hold true for that hypothetical family of earning about $82,000 a year with a $349,000 house. A family who just bought a $1 million house in California would probably be paying a lot more in taxes, while a single person earning $40,000 in Texas would be paying less.

See the full state-by-state breakdown and the tax burden in your state here.