States With the Largest (and Smallest) Tax Burden

Stressed couple planning taxes and finances
fizkes / Shutterstock.com

This story originally appeared on HireAHelper.

What is the landscape of taxes in America going into 2021? The Tax Cuts and Jobs Act, which was signed into law in 2017 by President Donald Trump, reduced personal income tax rates for most people across the nation. However, that same piece of tax legislation also put a cap on state and local tax (SALT) deductions. Formerly, taxpayers who itemize could deduct the total amount of state and local taxes paid on their federal tax return, which significantly reduced an individual’s federal tax burden. But the new tax code caps SALT deductions at $10,000 — a change that has made living in high-tax states even more expensive for high earners.

The three largest types of state and local taxes that impact residents in those states are sales, property, and individual income taxes. Based on data from the U.S Census Bureau’s most recent Annual Survey of State and Local Government Finances, Americans paid $1,869 in sales taxes, $1,301 in income taxes, and $1,672 in property taxes per capita in 2018. Combined, this equates to $4,842 per capita, or approximately 8.9% of per capita income. But, the total amount of taxes paid and the allocation of those taxes across sales, income, and property vary widely by state.

To identify the states with the largest and smallest tax burdens for residents, researchers at HireAHelper used data from the U.S. Census Bureau and U.S. Bureau of Economic Analysis to calculate the total annual property, income, and sales taxes collected in each state as a percentage of the state’s total annual personal income.

Here are the states with the highest tax burdens for residents, followed by the states with the lowest tax burdens.

1. New York

New York
Mikhail Kolesnikov / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 12.80%
Annual property, income, and sales taxes per person: $8,781
Property taxes as a percentage of income: 4.41%
Income taxes as a percentage of income: 4.96%
Sales taxes as a percentage of income: 3.43%

2. Hawaii

Honolulu, Hawaii
MNStudio / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 12.23%
Annual property, income, and sales taxes per person: $6,755
Property taxes as a percentage of income: 2.46%
Income taxes as a percentage of income: 3.10%
Sales taxes as a percentage of income: 6.68%

3. District of Columbia

Washington D.C.
f11photo / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 11.63%
Annual property, income, and sales taxes per person: $9,435
Property taxes as a percentage of income: 4.60%
Income taxes as a percentage of income: 3.63%
Sales taxes as a percentage of income: 3.40%

4. Vermont

Vermont
By Tony Baldasaro / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 10.92%
Annual property, income, and sales taxes per person: $5,827
Property taxes as a percentage of income: 5.12%
Income taxes as a percentage of income: 2.45%
Sales taxes as a percentage of income: 3.35%

5. Connecticut

Hartford, Connecticut
Sean Pavone / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 10.67%
Annual property, income, and sales taxes per person: $7,985
Property taxes as a percentage of income: 4.15%
Income taxes as a percentage of income: 3.64%
Sales taxes as a percentage of income: 2.88%

6. Maine

Portland Maine lighthouse
E.J.Johnson Photography / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 10.52%
Annual property, income, and sales taxes per person: $5,136
Property taxes as a percentage of income: 4.61%
Income taxes as a percentage of income: 2.46%
Sales taxes as a percentage of income: 3.45%

7. New Jersey

New Jersey from Delaware
Felix Mizioznikov / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 10.06%
Annual property, income, and sales taxes per person: $6,809
Property taxes as a percentage of income: 4.98%
Income taxes as a percentage of income: 2.49%
Sales taxes as a percentage of income: 2.59%

8. Minnesota

Minneapolis, Minnesota
nikitsin.smugmug.com / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 10.02%
Annual property, income, and sales taxes per person: $5,746
Property taxes as a percentage of income: 2.87%
Income taxes as a percentage of income: 3.69%
Sales taxes as a percentage of income: 3.46%

9. Rhode Island

Providence, Rhode Island
Sean Pavone / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 9.75%
Annual property, income, and sales taxes per person: $5,312
Property taxes as a percentage of income: 4.47%
Income taxes as a percentage of income: 2.31%
Sales taxes as a percentage of income: 2.98%

10. California

West Hollywood, California
dualpics / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 9.49%
Annual property, income, and sales taxes per person: $6,029
Property taxes as a percentage of income: 2.64%
Income taxes as a percentage of income: 3.78%
Sales taxes as a percentage of income: 3.06%

Now, for the states with the lowest tax burden for residents.

1. Alaska

Anchorage, Alaska
Rex Lisman / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 5.04%
Annual property, income, and sales taxes per person: $3,030
Property taxes as a percentage of income: 3.64%
Income taxes as a percentage of income: 0.00%
Sales taxes as a percentage of income: 1.40%

2. Tennessee

Nashville, Tennessee
jdross75 / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 5.70%
Annual property, income, and sales taxes per person: $2,694
Property taxes as a percentage of income: 1.69%
Income taxes as a percentage of income: 0.08%
Sales taxes as a percentage of income: 3.93%

3. Wyoming

People kayaking on a lake with a mountain in the background.
B Brown / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 6.11%
Annual property, income, and sales taxes per person: $3,709
Property taxes as a percentage of income: 3.32%
Income taxes as a percentage of income: 0.00%
Sales taxes as a percentage of income: 2.80%

4. Delaware

Wilmington, Delaware
Paul Brady Photography / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 6.17%
Annual property, income, and sales taxes per person: $3,260
Property taxes as a percentage of income: 1.76%
Income taxes as a percentage of income: 3.23%
Sales taxes as a percentage of income: 1.18%

5. New Hampshire

Portsmouth, New Hampshire
By Jo Ann Snover / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 6.83%
Annual property, income, and sales taxes per person: $4,192
Property taxes as a percentage of income: 5.47%
Income taxes as a percentage of income: 0.13%
Sales taxes as a percentage of income: 1.24%

6. Florida

Boca Raton, Florida
FloridaStock / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 6.86%
Annual property, income, and sales taxes per person: $3,489
Property taxes as a percentage of income: 2.70%
Income taxes as a percentage of income: 0.00%
Sales taxes as a percentage of income: 4.16%

7. Oklahoma

Grand Lake
By-Michael-J.-Munster / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 7.19%
Annual property, income, and sales taxes per person: $3,295
Property taxes as a percentage of income: 1.68%
Income taxes as a percentage of income: 1.93%
Sales taxes as a percentage of income: 3.58%

8. South Dakota

Sioux Falls, South Dakota
Jacob Boomsma / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 7.35%
Annual property, income, and sales taxes per person: $3,853
Property taxes as a percentage of income: 3.01%
Income taxes as a percentage of income: 0.00%
Sales taxes as a percentage of income: 4.34%

9. Montana

Montana
SNEHIT / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 7.36%
Annual property, income, and sales taxes per person: $3,540
Property taxes as a percentage of income: 3.55%
Income taxes as a percentage of income: 2.54%
Sales taxes as a percentage of income: 1.26%

10. Alabama

Birmingham, Alabama
Sean Pavone / Shutterstock.com

Property, income, and sales taxes as a percentage of income: 7.37%
Annual property, income, and sales taxes per person: $3,147
Property taxes as a percentage of income: 1.40%
Income taxes as a percentage of income: 1.94%
Sales taxes as a percentage of income: 4.03%

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