State Income Tax: Rates, Rules & Filing by State
Navigate the patchwork of state income tax systems with our complete guide to rates, deductions, and filing requirements across all 50 states.
State income tax is an additional tax on income imposed by most U.S. states and the District of Columbia on top of federal income tax. As of 2025, 41 states and D.C. levy some form of income tax on individuals, while nine states have no state income tax at all: Alaska, Florida, Nevada, New Hampshire (interest and dividends only until 2025), South Dakota, Tennessee, Texas, Washington, and Wyoming.
State income tax systems vary dramatically. Some states use a flat tax rate applied equally to all income levels, while others use progressive brackets similar to the federal system. Tax rates range from as low as 1% to over 13% in states like California. The rules around what income is taxable, what deductions are allowed, and how credits work differ from state to state.
Understanding your state income tax obligations is essential for accurate tax planning. If you live in one state and work in another, you may need to file returns in multiple states. Reciprocity agreements between some states can simplify this, but not all states participate in such arrangements.
How It Works
State income tax calculation typically starts with your federal Adjusted Gross Income (AGI) or federal taxable income, depending on the state. Each state then applies its own set of modifications, adding back certain federal deductions and subtracting state-specific deductions to arrive at state taxable income. The specifics vary widely by state.
Most states require you to file a state return by the same April 15 deadline as the federal return, though some states have different deadlines. Your employer withholds state income tax from your paycheck if you work in a state with income tax. If you are self-employed or have income not subject to withholding, you may need to make estimated quarterly payments to your state as well.
If you live in a state with income tax but work in a different state, you generally owe tax to the state where you earn the income. However, your home state typically provides a credit for taxes paid to other states to prevent double taxation. This system works through reciprocity agreements or tax credit mechanisms depending on the states involved.
Current Rates
| Bracket / Category | Rate | Applies To |
|---|---|---|
| No State Income Tax | 0% | AK, FL, NV, SD, TN, TX, WA, WY |
| Flat Rate States (examples) | 3.0% - 5.0% | CO (4.4%), IL (4.95%), PA (3.07%) |
| Low Progressive (top rate) | 4.0% - 6.0% | AZ (2.5%), ND (1.95%), OH (3.5%) |
| Moderate Progressive (top rate) | 6.0% - 8.0% | GA (5.39%), VA (5.75%), WI (7.65%) |
| High Progressive (top rate) | 8.0% - 10.0% | MN (9.85%), NJ (10.75%), OR (9.9%) |
| Highest Progressive (top rate) | 10%+ | CA (13.3%), HI (11%), NY (10.9%) |
Key Forms
Individual state income tax return (form name varies by state)
State withholding allowance certificate for employers
State-specific itemized deductions (where applicable)
Required when earning income in a state where you do not reside
Claim credit on home-state return for taxes paid to work state
Deductions & Credits
State Standard Deduction
Most states with income tax offer a standard deduction, though amounts vary significantly from the federal standard deduction.
State Earned Income Credit
About 30 states offer their own version of the EITC, often calculated as a percentage of the federal credit.
Property Tax Deduction/Credit
Many states allow a deduction or credit for property taxes paid, separate from the federal SALT deduction.
529 Plan Contribution Deduction
Over 30 states offer a deduction or credit for contributions to the state-sponsored 529 college savings plan.
State Child Tax Credit
A growing number of states offer their own child tax credits, some of which are refundable regardless of tax liability.
Filing Tips
- Check whether your state has a reciprocity agreement with your work state to avoid filing unnecessary nonresident returns.
- Review state-specific deductions that may not exist at the federal level, such as 529 plan contributions.
- If you moved during the year, you may need to file part-year resident returns in both your old and new states.
- Use your state tax agency website rather than third-party sites to find official forms and instructions.
- Many states offer free e-filing directly through their revenue department website, even if you paid for federal filing software.
- Keep track of the SALT deduction cap ($10,000) when calculating the interplay between your federal and state tax returns.
Frequently Asked Questions
Which states have no income tax?
Do I have to file in multiple states?
What is the SALT deduction cap?
How does remote work affect state income tax?
Can I deduct state income tax on my federal return?
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