March 21, 2014

State Personal Income Tax Rates and Brackets 2014 Update

Download FISCAL FACT No. 422: State Income Tax Rates and Brackets 2014

Key Findings

  • State income tax systems have significant variation in structure, rates, deductions, and exemptions, including 9 states with no income tax on wages and 8 with flat income taxes.
  • North Carolina became a flat tax state, moving from three brackets to just one. Massachusetts, another flat tax state, reduced its rate slightly.
  • Kansas, North Dakota, Ohio, and Wisconsin all made across-the-board income tax rate reductions relative to 2013 rates.
  • Minnesota added a high-earner tax bracket of 9.85 percent on income over $152,540 for single filers.
Income taxes are a major, and often complicated, component of state revenues. Furthermore, unlike sales or excise taxes which individuals pay indirectly, income taxes are levied directly on individuals, meaning that income taxes figure especially prominently in any discussion of tax burdens and public policies.
 
Income taxes are structured in many different ways throughout the states. Some are flat systems with one rate for all income, others offer progressive systems taxing different levels of income at different rates, while some states have no income tax at all. Some states abide by principles of sound tax policy and double bracket widths for married filers and index tax brackets for inflation, while others fail to adopt these measures. Some states offer generous standard deductions and personal exemptions, allowing taxpayers to adjust income based on household size, while others don’t. Below, we provide the most updated data available, as of publication date, on current state tax rates and brackets, standard deductions, and per-filer personal exemptions for individuals filing singly.
 

State Individual Income Tax Rates

As of January 1, 2014

State

Rates

 

Brackets

Standard Deduction

Personal Exemption

Alabama (e, f)

2.00%

>

$0

$2,500

$1,500

 

4.00%

>

$500

   
 

5.00%

>

$3,000

   

Alaska

No Income Tax

Arizona

2.59%

>

$0

$4,945

$2,100

 

2.88%

>

$10,000

   
 

3.36%

>

$25,000

   
 

4.24%

>

$50,000

   
 

4.54%

>

$150,000

   

Arkansas (c, d)

1.00%

>

$0

$2,000

$26 credit

 

2.50%

>

$4,199

   
 

3.50%

>

$8,299

   
 

4.50%

>

$12,399

   
 

6.00%

>

$20,699

   
 

7.00%

>

$34,599

   

California (a, d)

1.00%

>

$0

$3,906

$106 credit

 

2.00%

>

$7,582

   
 

4.00%

>

$17,976

   
 

6.00%

>

$28,371

   
 

8.00%

>

$39,384

   
 

9.30%

>

$49,774

   
 

10.30%

>

$254,250

   
 

11.30%

>

$305,100

   
 

12.30%

>

$508,500

   
 

13.30%

>

$1,000,000

   

Colorado

4.63% of federal taxable income

Connecticut

3.00%

>

$0

N/A

$14,000

 

5.00%

>

$10,000

   
 

5.50%

>

$50,000

   
 

6.00%

>

$100,000

   
 

6.50%

>

$200,000

   
 

6.70%

>

$250,000

   

Delaware (f)

2.20%

>

$2,000

$3,250

$110 credit

 

3.90%

>

$5,000

   
 

4.80%

>

$10,000

   
 

5.20%

>

$20,000

   
 

5.55%

>

$25,000

   
 

6.60%

>

$60,000

   

Florida

No Income Tax

   

Georgia

1.00%

>

$0

$2,300

$2,700

 

2.00%

>

$750

   
 

3.00%

>

$2,250

   
 

4.00%

>

$3,750

   
 

5.00%

>

$5,250

   
 

6.00%

>

$7,000

   

Hawaii

1.40%

>

$0

$2,200

$1,144

 

3.20%

>

$2,400

   
 

5.50%

>

$4,800

   
 

6.40%

>

$9,600

   
 

6.80%

>

$14,400

   
 

7.20%

>

$19,200

   
 

7.60%

>

$24,000

   
 

7.90%

>

$36,000

   
 

8.25%

>

$48,000

   
 

9.00%

>

$150,000

   
 

10.00%

>

$175,000

   
 

11.00%

>

$200,000

   

Idaho (a, d)

1.60%

>

$0

$6,200

$3,900

 

3.60%

>

$1,408

   
 

4.10%

>

$2,817

   
 

5.10%

>

$4,226

   
 

6.10%

>

$5,635

   
 

7.10%

>

$7,044

   
 

7.40%

>

$10,567

   

Illinois

5% of federal adjusted gross income with modification

   

$2,125

Indiana (f)

3.4% of federal adjusted gross income with modification

   

$1,000

Iowa (d, e)

0.36%

>

$0

$1,900

$40 credit

 

0.72%

>

$1,515

   
 

2.43%

>

$3,030

   
 

4.50%

>

$6,060

   
 

6.12%

>

$13,635

   
 

6.48%

>

$22,725

   
 

6.80%

>

$30,300

   
 

7.92%

>

$45,450

   
 

8.98%

>

$68,175

   

Kansas (f)

2.70%

>

$0

$3,000

$2,250

 

4.80%

>

$15,000

   

Kentucky (f)

2.00%

>

$0

$2,360

$20 credit

 

3.00%

>

$3,000

   
 

4.00%

>

$4,000

   
 

5.00%

>

$5,000

   
 

5.80%

>

$8,000

   
 

6.00%

>

$75,000

   

Louisiana (e)

2.00%

>

$0

$4,500

$1,000

 

4.00%

>

$12,500

   
 

6.00%

>

$50,000

   

Maine (d, h)

6.50%

>

$5,200

$6,100

$3,900

 

7.95%

>

$20,900

   

Maryland (f)

2.00%

>

$0

$2,000

$3,200

 

3.00%

>

$1,000

   
 

4.00%

>

$2,000

   
 

4.75%

>

$3,000

   
 

5.00%

>

$100,000

   
 

5.25%

>

$125,000

   
 

5.50%

>

$150,000

   
 

5.75%

>

$250,000

   

Massachusetts

5.20%

>

$0

N/A

$4,400

Michigan (f)

4.25% of federal adjusted gross income with modification

$3,950

   

Minnesota (d)

5.35%

>

$0

$6,200

$3,900

 

7.05%

>

$24,680

   
 

7.85%

>

$81,080

   
 

9.85%

>

$152,540

   

Mississippi

3.00%

>

$0

$2,300

$6,000

 

4.00%

>

$5,000

   
 

5.00%

>

$10,000

   

Missouri (e, f)

1.50%

>

$0

$6,200

$2,100

 

2.00%

>

$1,000

   
 

2.50%

>

$2,000

   
 

3.00%

>

$3,000

   
 

3.50%

>

$4,000

   
 

4.00%

>

$5,000

   
 

4.50%

>

$6,000

   
 

5.00%

>

$7,000

   
 

5.50%

>

$8,000

   
 

6.00%

>

$9,000

   

Montana (a, d, e)

1.00%

>

$0

$4,270

$2,280

 

2.00%

>

$2,800

   
 

3.00%

>

$4,900

   
 

4.00%

>

$7,400

   
 

5.00%

>

$10,100

   
 

6.00%

>

$13,000

   
 

6.90%

>

$16,700

   

Nebraska (g)

2.46%

>

$0

$6,200

$126 credit

 

3.51%

>

$3,000

   
 

5.01%

>

$18,000

   
 

6.84%

>

$29,000

   

Nevada

No Income Tax

New Hampshire (b)

5.00%

>

$0

N/A

$2,400

New Jersey (f)

1.40%

>

$0

N/A

$1,000

 

1.75%

>

$20,000

   
 

3.50%

>

$35,000

   
 

5.53%

>

$40,000

   
 

6.37%

>

$75,000

   
 

8.97%

>

$500,000

   

New Mexico

1.70%

>

$0

$6,200

$3,900

 

3.20%

>

$5,500

   
 

4.70%

>

$11,000

   
 

4.90%

>

$16,000

   

New York (f, g)

4.00%

>

$0

$7,700

$1,000

 

4.50%

>

$8,200

   
 

5.25%

>

$11,300

   
 

5.90%

>

$13,350

   
 

6.45%

>

$20,550

   
 

6.65%

>

$77,150

   
 

6.85%

>

$205,850

   
 

8.82%

>

$1,029,250

   

North Carolina

5.80%

>

$0

$7,500

N/A

North Dakota (d)

1.22%

>

$0

$6,200

$3,900

 

2.27%

>

$36,900

   
 

2.52%

>

$89,350

   
 

2.93%

>

$186,350

   
 

3.22%

>

$405,100

   

Ohio (a, d, f, h)

0.54%

>

$0

N/A

$1,700

 

1.07%

>

$5,200

   
 

2.15%

>

$10,400

   
 

2.69%

>

$15,650

   
 

3.22%

>

$20,900

   
 

3.76%

>

$41,700

   
 

4.30%

>

$83,350

   
 

4.99%

>

$104,250

   
 

5.392%

>

$208,500

   

Oklahoma

0.50%

>

$0

$5,950

$1,000

 

1.00%

>

$1,000

   
 

2.00%

>

$2,500

   
 

3.00%

>

$3,750

   
 

4.00%

>

$4,900

   
 

5.00%

>

$7,200

   
 

5.25%

>

$8,700

   

Oregon (d, e, f)

5.00%

>

$0

$2,025

$188 credit

 

7.00%

>

$3,300

   
 

9.00%

>

$8,250

   
 

9.90%

>

$125,000

   

Pennsylvania (f)

3.07%

>

$0

N/A

N/A

Rhode Island (d)

3.75%

>

$0

$8,000

$3,800

 

4.75%

>

$59,600

   
 

5.99%

>

$135,500

   

South Carolina (d)

3.00%

>

$2,880

$6,200

$3,900

 

4.00%

>

$5,760

   
 

5.00%

>

$8,640

   
 

6.00%

>

$11,520

   
 

7.00%

>

$14,400

   

South Dakota

No Income Tax

Tennessee (b)

6.00%

>

$0

N/A

$1,250

Texas

No Income Tax

Utah

5.00%

>

$0

N/A

$2,850

Vermont (d)

3.55%

>

$0

$6,200

$3,900

 

6.80%

>

$36,900

   
 

7.80%

>

$89,350

   
 

8.80%

>

$186,350

   
 

8.95%

>

$405,100

   

Virginia

2.00%

>

$0

$3,000

$930

 

3.00%

>

$3,000

   
 

5.00%

>

$5,000

   
 

5.75%

>

$17,000

   

Washington

No Income Tax

West Virginia

3.00%

>

$0

N/A

$2,000

 

4.00%

>

$10,000

   
 

4.50%

>

$25,000

   
 

6.00%

>

$40,000

   
 

6.50%

>

$60,000

   

Wisconsin (d)

4.00%

>

$0

$9,930

$700

 

5.84%

>

$10,910

   
 

6.27%

>

$21,820

   
 

7.65%

>

$240,190

   

Wyoming

No Income Tax

Washington, DC

4.00%

>

$0

$2,000

$1,675

 

6.00%

>

$10,000

   
 

8.50%

>

$40,000

   
 

8.95%

>

$350,000

   
 

Note: Brackets are for single taxpayers. Some states double bracket widths for joint filers (AL, AZ, CT, HI, ID, KS, LA, ME, NE, and OR). NY doubles all except the 6.85% bracket, which is effective at $300,000. CA doubles all but the top bracket. Some states increase but do not double brackets for joint filers (GA, MN, NM, NC, ND, OK, RI, VT, and WI). MD decreases some and increases others. NJ adds a 2.45% rate and doubles some bracket widths. Consult Tax Foundation website for tables for joint filers and married filing separately.

(a) 2014 rates but 2013 brackets for CA, ID, MT, and OH. Laws in these states forbid revenue officials from inflation-indexing brackets until mid-year.

(b) Tax applies to interest and dividend income only.

(c) Rates apply to regular tax table. A special tax table is available for low-income taxpayers which reduces their tax payments.

(d) Bracket levels adjusted for inflation each year.

(e) These states allow some or all of federal income tax paid to be deducted from state taxable income.

(f) Local income taxes are excluded. Twelve states have county or city level income taxes; the average rate within each jurisdiction is: 0.5% in AL; 1.38% in DE; 1.49% in IN; 0.5% in KS; 2.08% in KY; 2.88% in MD; 1.75% in MI; 0.5% in MO; 2.11% in NY; 2.25% in OH; 0.36% in OR; and 2% in PA. Weighted local rates are from Tax Foundation, 2014 State Business Tax Climate Index.

(g) NY and NE have “tax benefit recapture,” by which many high-income taxpayers pay their top tax rate on all income, not just on amounts above the bracket threshold.

(h) Ohio has suspended inflation indexing for the years 2013-2015. Maine has suspended inflation indexing for the years 2014-2015.

Source: Tax Foundation; state statutes, state tax forms and instructions; Commerce Clearing House.

A tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities.

Inflation is when the general price of goods and services increases across the economy, reducing the purchasing power of a currency and the value of certain assets. The same paycheck covers less goods, services, and bills. It is sometimes referred to as a “hidden tax,” as it leaves taxpayers less well-off due to higher costs and “bracket creep,” while increasing the government’s spending power.

The standard deduction reduces a taxpayer’s taxable income by a set amount determined by the government. It was nearly doubled for all classes of filers by the 2017 Tax Cuts and Jobs Act as an incentive for taxpayers not to itemize deductions when filing their federal income taxes.

Inflation indexing refers to automatic cost-of-living adjustments built into tax provisions to keep pace with inflation. Absent these adjustments, income taxes are subject to “bracket creep” and stealth increases on taxpayers, while excise taxes are vulnerable to erosion as taxes expressed in marginal dollars, rather than rates, slowly lose value.

Taxable income is the amount of income subject to tax, after deductions and exemptions. For both individuals and corporations, taxable income differs from—and is less than—gross income.