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Oklahoma Tax Guide: Income Brackets & Deductions

Understand Oklahoma's progressive income tax, sales tax obligations, and low property taxes for the 2025 tax year.

4.75%
Top Income Tax Rate
8.97%
Combined Sales Tax
0.87%
Property Tax Rate
#37
Tax Burden Rank

Tax Overview

Oklahoma uses a progressive income tax system with a top rate of 4.75% on income above $7,200 for single filers. While this top rate is moderate, it kicks in at a very low income threshold, meaning most working Oklahomans pay near the top rate. The state has been gradually reducing rates over the years, and the current system represents a balance between competitive rates and revenue needs.

Sales tax in Oklahoma is significant, with a state rate of 4.5% and local additions that frequently push the combined rate above 8%. Some jurisdictions see combined rates exceeding 10%, making Oklahoma one of the higher combined sales tax states. Oklahoma does tax groceries at the full rate, which is a notable burden for lower-income households.

Property taxes in Oklahoma are among the lowest in the nation, with effective rates around 0.87%. The state constitution caps property tax rates and limits annual assessment increases. Oklahoma offers several property tax exemptions, including a homestead exemption for owner-occupied homes and additional exemptions for seniors, disabled veterans, and certain low-income homeowners. The low property taxes help offset the impact of high sales taxes.

Income Tax

Oklahoma's top rate of 4.75% applies to income above just $7,200 for single filers, meaning most working residents pay near the top rate.

Income RangeTax Rate
$0 – $1,0000.25%
$1,001 – $2,5000.75%
$2,501 – $3,7501.75%
$3,751 – $4,9002.75%
$4,901 – $7,2003.75%
$7,201 +4.75%

Sales Tax

State Rate4.50%
Avg. Local Rate4.47%
Combined Rate8.97%

Property Tax

Effective Rate0.87%
Median Annual Bill$1,278

Key Deductions in Oklahoma

  • ✓Oklahoma standard deduction of $6,350 (single) or $12,700 (married filing jointly)
  • ✓Retirement income exclusion (up to $10,000 per person)
  • ✓Oklahoma 529 plan contribution deduction (up to $10,000 single)
  • ✓100% military retirement pay exclusion
  • ✓Child tax credit ($1,000 per qualifying child)
  • ✓Earned income credit (5% of federal EITC)

Filing Information

Filing Deadline: April 15

Tax Authority: Oklahoma Tax Commission

Phone: (405) 521-3160

Website: https://oklahoma.gov/tax.html

Frequently Asked Questions

Does Oklahoma tax groceries?
Yes, Oklahoma taxes groceries at the full combined sales tax rate, which averages about 8.97%. This is one of the highest grocery tax burdens in the nation and has been a topic of legislative discussion for reduction or elimination.
Is military retirement pay taxed in Oklahoma?
No, Oklahoma provides a 100% exclusion for military retirement pay. This makes Oklahoma one of the most military-friendly states for tax purposes and has helped attract military retirees.
Does Oklahoma tax Social Security?
No, Oklahoma does not tax Social Security benefits at the state level. The state also offers up to $10,000 per person in retirement income exclusions for other types of retirement distributions.
How do Oklahoma property tax exemptions work?
Oklahoma offers a homestead exemption that removes $1,000 of assessed value (not market value) for owner-occupied properties. Additional exemptions exist for seniors (double homestead), disabled veterans, and low-income homeowners over 65.

Neighboring State Guides

KansasMissouriArkansasTexasNew MexicoColorado

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