By Hank Russell
With more than a month to go before the tax filing deadline approaches, WalletHub just released a report on the states with the highest and lowest tax rates. For New Yorkers, it came as no surprise that the Empire State had some of the highest — if not the highest — taxes in the nation.
According to WalletHub, New York had the second highest annual state and local taxes on the median state household with $13,774. New Jersey had the highest rate with $15,032. (In this case, the median income differs from state to state.) On the median U.S. household based on an annual income of $79,004, a home valued at $303,400 and a car valued at $28,700, state and local taxes are $11,642 a year. That is second to Illinois, with $13,099.
New York was also second to Illinois in terms of the effective total state and local tax rates on the median U.S. household. The Empire State’s tax rate was 14.74%, compared with the Prairie State’s 16.58% tax rate. Both states exceed the national average of 10.92%, based on WalletHub data.
Out of 50 states and the District of Columbia, New York is 47th in WalletHub’s report when it comes to cost of living, meaning it is virtually unaffordable.
WalletHub also found that New York had the sixth-highest real estate tax rate at 6.15% and real estate taxes at $4,856 a year. The state’s income tax rate was 3.80%, behind Pennsylvania (4.11%) and Oregon (5.34%). That means New Yorkers pay an annual income tax of $3,003 a year on average, compared to Pennsylvania with $3,249 annually and Oregon at $4,215 a year.
“Every year during tax season, Americans are reminded of just how much of their hard-earned income isn’t theirs to keep,” said WalletHub analyst Chip Lupo. “Living in the right state can ease the stress of tax time, though, as taxpayers in the least expensive states pay less than half as much as those in the most expensive states.”