State and Local Tax Burdens

The Tax Foundation released a report outlining the state and local tax burdens of the residents of each state. Some of the key findings of the report are below:

•During the 2011 fiscal year, state-local tax burdens as a share of state incomes decreased on average. This trend was largely driven by the growth of income in all states.
•In 2011, the residents of New York, New Jersey, and Connecticut had the highest state-local tax burdens as a share of income in the nation. In these states, residents have forgone over 11.9 percent of income due to state and local taxes.
•Residents of Wyoming paid the lowest percentage of income in 2011 at just 6.9 percent. They replaced Alaska, which had previously been the least-taxed for multiple decades, as the lowest-burdened state in the nation. After Wyoming and Alaska, the next lowest-taxed states were South Dakota, Texas, and Louisiana.
•State-local tax burdens are very close to one another and slight changes in taxes or income can translate to seemingly dramatic shifts in rank. For example, the twenty mid-ranked states, ranging from Oregon (16th) to Georgia (35th), only differ in burden by just over one percentage point.
•On average, taxpayers pay more to their own state and local governments (73 percent of total burden). Taxes paid within states of residence decreased on average in 2011, while taxes paid to other states increased, leading to a slight decrease in total burden. Some states deviated from these national trends, however.

For the full report, visit:
http://taxfoundation.org/article/annual-state-local-tax-burden-ranking-fy-2011

State and Local Income Tax Bracket Updates

The Tax Foundation has listed an updated list of state and local tax brackets.
Some key changes that they found for this year include:

  • State income tax systems have significant variation in structure, rates, deductions, and exemptions, including 9 states with no income tax on wages and 8 with flat income taxes.
  • North Carolina became a flat tax state, moving from three brackets to just one.
  • Massachusetts, another flat tax state, reduced its rate slightly.
  • Kansas, North Dakota, Ohio, and Wisconsin all made across-the-board income tax rate reductions relative to 2013 rates.
  • Minnesota added a high-earner tax bracket of 9.85 percent on income over $152,540 for single filers.

For a full list of changes visit:
State Tax Income Brackets for 2014 Update

Same Sex Tax Guidence

The Tax Foundation has come out with a comprehensive summary on state guidance for same-sex couples  who are filing joint federal tax returns for 2013.
The summary can be found here:

States Provide Income Tax Filing Guidance to Same-Sex Couples

Government Shutdown, Census Bureau Offline! Information Elsewhere.

As a result of congress being unable to get past their petty squabbles, the government has shut down and the Census Bureau’s website has gone dark. All of the information regarding state and local government spending and tax data would be largely unavailable, had not the Tax Foundation posted it to their website.

To access this data visit:
http://taxfoundation.org/blog/tax-foundation-offers-key-state-tax-and-spending-data-after-census-bureau-website-shuts-down

Combined Sales Tax Rates

Sales tax can be tricky, especially when you are analyzing combined sales tax rates (state rate plus city or local rate).
In some states (Delaware, New Hampshire, and Oregon) you will find no sales tax. In others (Alaska, and Montana) you will find no State sales tax but you may be charged local sales tax.

In many states you can cross the street, and be subjected to a completely different set of sales tax rules.

The highest average combined rates (highest to lowest) are in Tennessee, Arkansas, Louisiana, Washington, and Oklahoma. The lowest are (lowest to highest) Alaska, Hawaii, Maine, and Wisconsin.

The highest combined rate is in Tuba City, Arizona (%12.725), though Homer and Seldovia, AK, and Snowmass, CO have a higher local rate (7.5%)

The list goes on, and the people at the Tax Foundation have done a very good job analyzing this data. To see the article and read more visit:
http://taxfoundation.org/article/state-and-local-sales-tax-rates-midyear-2013