Which States Have an Income Tax? Here’s the List

| December 20, 2012

state income tax list The Internal Revenue Service collects individual income tax, as do 41 states and the District of Columbia. Find out if you must pay on both levels by learning which states tax individual income and which do not, then use DexKnows listings to find a certified public accountant or online tax tools for filing your 2012 IRS forms.

States without an income tax

If you live in Alaska, Florida, Nevada, South Dakota, Texas, Washington or Wyoming, you do not pay income tax as an individual on the state level. Tennessee and New Hampshire do collect individual income taxes, but only on dividends and interest earned.

States with an income tax

That leaves Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Utah, Vermont, Virginia, West Virginia and Wisconsin as the states that do collect an individual income tax. As noted above, the District of Columbia also expects its residents to pay a local income tax according to 2012 tax rates.

Flat Income Tax vs. Range Income Tax

Seven states — Colorado, Illinois, Indiana, Massachusetts, Michigan, Pennsylvania and Utah — have a flat income tax, while the rest collect according to income ranges. The ranges that apply to 2012 tax rates vary not only by percentage but also by the amount of brackets within the range, with the fewest being one, the flat tax, and the most being 12. Whether you plan to file as a single or married person also affects the percentage required.

New York, for example, has the following brackets for 2102 for single persons, with the percents simply doubling for married persons filing jointly:

  • 4 percent on first $8,000
  • 4.5 percent between $8,001 and $11,000
  • 5.25 percent between $11,001 and $13,000
  • 5.9 percent between $13,001 and $20,000
  • 6.85 percent between $20,001 and $200,000
  • 7.85 percent between $200,001 and $500,000
  • 8.97 percent on more than $500,000

Alabama has a significantly lower income tax for its residents. Single persons, heads of families and married persons filing separate returns pay:

  • 2 percent on first $500
  • 4 percent between $501 and $3,000
  • 5 percent on more than $3,000

Married persons filing jointly pay:

  • 2 percent on first $1,000
  • 4 percent between $1,001 and $6,000
  • 5 percent on more than $6,000

California spans a much wider range of taxpayers. Single persons and married persons filing separately pay:

  • 1.25 percent on first $7,060
  • 2.25 percent between $7,061 and $16,739
  • 4.25 percent between $16,740 and $26,419
  • 6.25 percent between $26,420 and $36,675
  • 8.25 percent between $36,676 and $46,349
  • 9.55 percent on more than $46,350

In California, married couples filing jointly simply double the percentage.

The above percentages apply to taxable income, meaning that deductions can move you to a lower tax bracket. To learn what the income tax rates and brackets are for your state, contact your state’s department of revenue. BankRate.com also has an excellent resource that provides state income tax information.

If you need help finding a certified public accountant to prepare your 2012 federal tax forms and state forms, DexKnows listings can point you in the right direction. A professional also can advise you on any new 2012 tax laws as well as 2013 tax rates, so you can better plan for the coming year.

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Category: Accountants & Tax Preparers, Taxes

About the Author ()

Pamela Mitchell spent more than 15 years at daily newspapers such as the Hartford Courant and Houston Chronicle before becoming a full-time freelancer. She now writes about a variety of topics, from dining and entertainment to pets and travel.