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Sunday, December 22, 2024

Illinois’ 15% state-local tax rate ranks highest in nation in new study

Tax revenues karolina grabowska

States differ widely on their approach to taxation, according to WalletHub. | Pexels.com / Karolina Grabowska

States differ widely on their approach to taxation, according to WalletHub. | Pexels.com / Karolina Grabowska

Illinois’ combined state and local tax rate of nearly 15.1% is the highest among all 50 states and the District of Columbia, according to a new study from the personal-finance website WalletHub.

In Illinois, state and local tax payments by households making the median U.S. income amounted to $10,463, the highest amount in the nation, according to WalletHub. The study is based on state and local taxes on real estate, vehicles, income and product sales. 

While the average American household pays almost $11,000 in federal income taxes, the rates on state and local taxes vary greatly, with Alaskans paying only 6.05% – about a third of what Illinois residents pay.

The Prairie State also had the second highest gas taxes in the nation, just behind California, according to the WalletHub analysis.

Low income taxes in some states do not always mean low state and local tax rates overall, the report found. Texans may not pay a state income tax, but they spend 1.74% of their income on property taxes, which is one of the highest real estate tax rates in the nation, according to WalletHub.

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2023 Combined State and Local Sales Tax Rates

Overall Rank

(1=Lowest)

StateEffective Total State & Local Tax Rates on Median U.S. HouseholdAnnual State & Local Taxes on Median U.S. Household% Difference Between State & U.S. Avg.Annual State & Local Taxes on Median State HouseholdAdjusted Overall Rank (Based on Cost of Living Index)
1Alaska6.05%$4,204-43.82%$4,8704
2Delaware6.34%$4,405-41.14%$4,7071
3Montana7.12%$4,948-33.88%$4,7732
4Nevada7.79%$5,414-27.64%$5,63610
5Wyoming8.06%$5,604-25.10%$5,5119
6Florida8.21%$5,706-23.74%$5,3556
7Utah8.23%$5,719-23.57%$6,8878
8Idaho8.29%$5,765-22.96%$5,5455
9Colorado8.53%$5,930-20.75%$7,38313
10Tennessee8.58%$5,965-20.29%$4,9643
11Oregon8.91%$6,192-17.25%$7,32922
12California8.97%$6,238-16.64%$9,61232
13South Carolina9.07%$6,304-15.75%$5,28811
14Alabama9.12%$6,341-15.26%$4,9247
15District of Columbia9.13%$6,343-15.23%$10,35746
16Arizona9.39%$6,529-12.75%$6,45214
17West Virginia9.72%$6,758-9.69%$4,78012
18New Hampshire9.90%$6,879-8.06%$8,06131
19North Dakota10.16%$7,064-5.60%$6,65225
20North Carolina10.51%$7,307-2.35%$6,30216
21Georgia10.55%$7,335-1.98%$6,69215
22New Mexico10.59%$7,361-1.63%$5,69821
23Virginia10.69%$7,433-0.66%$8,57824
24Hawaii10.70%$7,440-0.57%$10,45650
25Louisiana10.75%$7,469-0.18%$5,71019
26Massachusetts10.86%$7,5510.92%$10,87043
27South Dakota11.01%$7,6562.31%$6,59726
28Rhode Island11.24%$7,8164.45%$8,84244
29Arkansas11.30%$7,8524.93%$5,71218
30Missouri11.30%$7,8554.97%$6,57817
31Minnesota11.31%$7,8595.03%$8,51130
32Oklahoma11.51%$8,0026.94%$6,15423
33Maryland11.52%$8,0066.99%$10,72945
34Maine11.62%$8,0757.91%$7,28939
35Indiana11.76%$8,1739.23%$6,85128
36Vermont11.77%$8,1839.36%$8,06042
37Mississippi11.93%$8,29010.79%$5,83420
38Washington11.97%$8,32311.22%$10,91540
39Michigan12.15%$8,44912.91%$6,96527
40Kentucky12.50%$8,68716.09%$6,69829
41Texas12.73%$8,84618.21%$8,00634
42Wisconsin12.95%$9,00420.32%$8,08935
43New Jersey12.98%$9,02320.58%$12,65248
44Nebraska13.15%$9,14222.17%$7,78637
45Ohio13.20%$9,17822.66%$7,30633
46Iowa13.31%$9,24823.60%$7,64536
47Kansas13.57%$9,43326.06%$7,91938
48Pennsylvania13.92%$9,67529.30%$8,82041
49New York14.23%$9,89432.22%$12,04749
50Connecticut14.80%$10,28737.47%$12,12051
51Illinois15.05%$10,46339.83%$9,98747
Source: WalletHub.com

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