The border escape to corporate haven. Delaware's 6.6% rate and NO SALES TAX (one of 5 states) undercuts New Jersey's 10.75% and crushing property taxes (1.89%, highest nationally). At $100,000: New Jersey $8,688 vs Delaware $5,765—save $2,923/year. Add property tax: NJ pays $7,560/year on $400K home (1.89%) vs DE $2,240 (0.56%)—save another $5,320/year. Total savings $8,243 annually. Wilmington is 30 minutes from South Jersey. Trade-off: Delaware is small (1M population), limited urban amenities, but excellent for remote workers and retirees.

By CountryTaxCalc Research Team

Last Updated: April 2026

The Big Picture

🏖️ New Jersey

10.75%

High Tax State

7 brackets up to 10.75%

🐔 Delaware

6.6%

Moderate Tax

6 brackets up to 6.6%

Typical Annual Savings

At $100,000 income:

$2,923

That is $244/month back in your pocket!

Tax Savings by Income Level

IncomeNJ TaxDE TaxSavings10-Year
$50,000 $2,525$2,860NJ saves $335$3,350
$75,000 $4,563$4,510NJ saves $53$530
$100,000 $8,688$5,765DE saves $2,923$29,230
$150,000 $11,738$9,065DE saves $2,673$26,730
$250,000 $22,238$15,665DE saves $6,573$65,730
$500,000 $49,113$32,165DE saves $16,948$169,480

New Jersey Pros and Cons

✅ Pros

  • Proximity to NYC (30 min from Manhattan)
  • Top-ranked public schools (Bergen, Morris counties)
  • Shore communities and established infrastructure
  • High pharma/finance job density

❌ Cons

  • 10.75% top rate—3rd-highest nationally
  • Highest property taxes in America (1.89% = $7,560/year on $400K)
  • Massive outmigration (-64,000 in 2022)
  • High cost of living across all categories

Delaware Pros and Cons

✅ Pros

  • 6.6% rate—4.15 points lower than NJ
  • NO SALES TAX (save $2,400/year on $40K spending vs NJ 6.625%)
  • Low property tax (0.56% = $2,240/year on $400K home)
  • 30 minutes from South Jersey, 2 hours from NYC/Philly

❌ Cons

  • Small state (1M population)—limited urban amenities
  • Wilmington 70K population (feels small vs Jersey suburbs)
  • Limited job market outside Wilmington/Dover corporate hub
  • Higher income tax than PA (3.07% flat) across the border
💡

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Frequently Asked Questions

Q: How much will I save moving from New Jersey to Delaware?

Income tax at $100K: save $2,923/year (NJ $8,688 → DE $5,765). Property tax is the game-changer: NJ $7,560/year on $400K home (1.89%) vs DE $2,240 (0.56%)—save $5,320/year. Sales tax: NJ 6.625% on $40K spending = $2,650, DE $0 (NO SALES TAX)—save $2,650/year. Total: save $10,893/year at $100K income + $400K home + $40K spending. Over 10 years: $108,930. Delaware wins decisively.

Q: Is Wilmington or Dover better for New Jersey refugees?

Wilmington for jobs/proximity: 30 minutes from South Jersey, 2 hours from NYC/Philly. Corporate jobs (DuPont, JP Morgan Chase, AstraZeneca, Bank of America—67% Fortune 500 incorporated in DE). Median home $340K (vs NJ suburbs $500K-650K). Population 70K (small, but has city amenities). Dover for affordability: State capital, median home $285K, government jobs, quieter. Delaware beaches (Rehoboth, Lewes) 1-2 hours away—closer/cheaper than NJ shore. Choose Wilmington if working/commuting, Dover for retirement/remote work.

Q: Why does Delaware have NO SALES TAX?

Delaware is one of only 5 states with NO SALES TAX (AK, DE, MT, NH, OR). The state relies on income tax (6.6%, $1.6B annually) + massive corporate franchise tax revenue ($1.4B from 1.6M corporations registered, including 67% of Fortune 500). At $100K income + $40K spending: DE pays $5,765 income + $0 sales = $5,765 total. NJ: $8,688 income + $2,650 sales (6.625%) = $11,338 total. DE saves $5,573/year. NO SALES TAX offsets Delaware's 6.6% income tax completely.

Q: Can I commute from Delaware to New Jersey for work?

Yes, but watch tax implications. If you live in DE and work in NJ, you pay NJ tax on NJ-sourced income, then get credit against DE tax. Net: you pay higher of NJ (10.75%) or DE (6.6%) = NJ wins (10.75%). So commuting doesn't save income tax. Better: work remotely from DE for NJ employer (pay only DE 6.6%). Or find DE job (DuPont, JPM, pharma in Wilmington). Property tax savings alone justify move: NJ $7,560/year vs DE $2,240 on $400K home = save $5,320 annually.

Q: How does Delaware tax Social Security and retirement income?

Delaware is EXCELLENT for retirees. Social Security FULLY EXEMPT for age 60+ (no income threshold—all SS tax-free). Pension income FULLY EXEMPT up to $12,500/year if age 60+ (amounts above $12,500 taxed at 6.6%). Example: At $80K retirement ($25K SS + $55K pension), age 65: DE taxes $0 SS (exempt) + $42,500 pension ($55K - $12,500 exemption) at 6.6% = $2,805 tax (3.5% effective). Compare NJ $4,500. Save $1,695/year + NO SALES TAX saves retirees $1,500+/year. Delaware is top-15 retiree tax-friendliness.

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