Last Updated: April 2026
US state income tax ranges from 0% (Texas, Florida, Nevada, Washington, Wyoming, South Dakota, Alaska, New Hampshire on wages, Tennessee on wages) to 13.3% (California’s top marginal rate). But top marginal rates are often misleading — California’s 13.3% rate only applies on income above $1 million for single filers. Most $100,000–$300,000 earners in California pay an effective state rate of roughly 6–8%, not 13.3%.
Understanding which states actually cost the most at typical income levels requires looking at effective burden — the actual percentage of total income paid in state taxes after deductions and credits. This guide provides both rankings: top marginal rate (useful for ultra-high earners and planning purposes) and effective burden at $100,000 income (the more practical benchmark for most professionals). It also addresses the question every high earner in a high-tax state asks: is the economic opportunity and quality of life worth the tax premium?
Top marginal rates apply only to income above the specified thresholds. High marginal rates primarily affect ultra-high earners and are often irrelevant for most residents.
| Rank | State | Top Marginal Rate | Income Threshold (Single) | Notes |
|---|---|---|---|---|
| 1 | California | 13.3% | $1,000,000+ | 12.3% base + 1% Mental Health Services Tax. Standard rate at $75K–$400K is 9.3%. |
| 2 | Hawaii | 11% | $200,000+ | High rate kicks in at relatively low threshold. Effective rate at $100K: ~6.5%. |
| 3 | New Jersey | 10.75% | $1,000,000+ | Rate between $500K–$1M is 10.75%; below $500K max rate is 6.37% (single) or 8.97% ($400K+). |
| 4 | Washington DC | 10.75% | $1,000,000+ | DC is a district, not a state. 10.75% on income above $1M; 9.25% on $60K–$350K. |
| 5 | New York | 10.9% | $25,000,000+ | 10.9% is the billionaire surcharge level. $1M–$25M: 10.3%. Below $1M: 6.85% max rate (up to $25K extra NYC local of 3.876%). |
| 6 | Oregon | 9.9% | $125,000+ | Distinctive: 9.9% bracket starts at only $125,000 for single filers, making Oregon’s effective burden very high at moderate incomes. |
| 7 | Minnesota | 9.85% | $183,341+ | 9.85% applies at relatively moderate income thresholds compared to CA/NJ. Effective at $100K: ~7.2%. |
| 8 | Vermont | 8.75% | $242,750+ | Small state, high rates. Effective rate at $100K: ~5.8%. |
| 9 | Maine | 7.15% | $58,050+ | 7.15% flat rate above $58,050. Relatively low threshold means high effective rates at typical incomes. |
| 10 | Idaho | 5.8% | $4,489+ | Flat rate of 5.8% on nearly all income above a small threshold. Simple but adds up. |
Effective burden is the actual percentage of $100,000 gross income paid in state income tax after standard deductions and personal exemptions. This is the more relevant comparison for most professionals and families.
| Rank | State | Approx. Effective Rate at $100K | Approx. Annual Tax at $100K | Notes |
|---|---|---|---|---|
| 1 | Oregon | ~8.4% | ~$8,400 | High brackets kick in early. 9.9% rate applies above $125K; earners near $100K pay 8.75% on most income above $17.4K. |
| 2 | Minnesota | ~7.2% | ~$7,200 | 9.85% top rate; effective at $100K ~7.2%. Compared to states with similarly high top rates, Minnesota’s brackets are lower-threshold. |
| 3 | California | ~6.8% | ~$6,800 | Despite 13.3% top marginal rate, effective rate at $100K is ~6.8% due to the high threshold for top rates. |
| 4 | Hawaii | ~6.5% | ~$6,500 | Combined with Hawaii’s high cost of living, this produces significant total financial pressure at moderate incomes. |
| 5 | Vermont | ~5.8% | ~$5,800 | Vermont’s 8.75% top rate phase-in and prior bracket structure creates ~5.8% effective at $100K. |
| 6 | New York | ~5.7% | ~$5,700 | State income tax only. Add NYC local income tax (up to 3.876%) for city residents: effective total ~9.3%. |
| 7 | Wisconsin | ~5.6% | ~$5,600 | Often overlooked, Wisconsin’s 7.65% top rate (down from 9.8% in 2020s reforms) and bracket structure produce high effective rates. |
| 8 | Maine | ~5.5% | ~$5,500 | Maine’s 7.15% rate above $58,050 means most of a $100K income is taxed at the top rate. |
| 9 | South Carolina | ~5.3% | ~$5,300 | 6.5% top rate on income above $17,330 (after 2022 reform from 7%). Often surprises residents with its effective burden. |
| 10 | Connecticut | ~5.2% | ~$5,200 | 6.99% top rate for income above $250,000 (single). Effective at $100K ~5.2%. Also has limited property tax credit. |
The economic and quality-of-life question matters as much as the raw tax number. High-tax states are expensive for a reason: they typically offer the largest economies, most lucrative job markets, and strongest educational and cultural institutions in the country.
California is home to Silicon Valley (the world’s largest tech ecosystem), Hollywood (global entertainment industry), and the nation’s largest agricultural economy. San Francisco and Los Angeles offer average tech salaries of $180,000–$300,000+ — a salary premium that far exceeds the state tax disadvantage versus Texas or Florida for most workers. A software engineer earning $250,000 in San Francisco pays ~$18,000–20,000 more in state income tax than a comparable role in Austin. But if the California role pays $280,000 versus $200,000 in Austin, the pre-tax salary premium dominates. The tax comparison matters most for earners with portable income (remote workers, investors, business owners) who can capture the California salary premium without being California tax residents.
New York City combines New York State income tax (up to 10.9%) with New York City local income tax (up to 3.876%), producing the highest effective state+local income tax burden in the nation for high earners in the city — effectively 14%+ combined at top incomes. Yet NYC maintains one of the world’s most concentrated pools of finance, law, media, and professional services employment. The premium for NYC careers is real, but the tax cost at $300,000+ income is substantial. A $500K earner in New York City pays ~$70,000 in combined state+city income tax versus $0 in Texas or Florida — a $70,000/year difference that, over a career, is transformative wealth.
California loses approximately 500,000 net domestic migrants per year to: Texas (~200,000), Arizona (~100,000), Nevada (~80,000), and Washington (~40,000). New York loses ~$14 billion in adjusted gross income annually to Florida, New Jersey, and Texas. Illinois’ population has declined in seven of the last eight years, primarily to Indiana, Texas, and Florida. The migration pattern is concentrated among high earners and retirees — the groups most sensitive to income and property tax costs. Lower-income residents are less mobile and more dependent on the services high-tax states fund.
New Jersey has the nation’s highest property tax rates (~2.3% of assessed value), meaning a $600,000 home generates ~$13,800/year in property taxes. Illinois: ~2.1% rate. New Hampshire: ~2.1% rate (but no income or sales tax). Connecticut: ~1.8%. By contrast, California’s Proposition 13 caps property tax increases — a longtime California homeowner may pay well below market rate in property tax. Total tax burden comparisons that include property tax sometimes re-rank states in non-obvious ways.
For high earners seriously considering leaving a high-tax state, the process is more involved than simply moving — particularly for California and New York, which aggressively pursue residents who attempt to change domicile.
California Franchise Tax Board (FTB) is notoriously aggressive in auditing high earners who claim to have left California. Key rule: California taxes residents on worldwide income. You are a California resident if you are in California for other than temporary or transitory purposes. If you move to Nevada or Texas but maintain a California home, California clients, California business activities, or regularly return to California, the FTB may assert continued California tax residency. To successfully establish Nevada/Texas domicile: sell or rent out your California home (do not maintain a California residence); spend fewer than 546 days in California over two consecutive calendar years (safe harbor); change voter registration, vehicle registration, professional licenses, and primary bank accounts to the new state; establish a physical home and ties in the new state.
New York also pursues departed high earners aggressively via its statutory resident rule: if you maintain a permanent place of abode in New York AND spend more than 183 days/year in New York, you are taxed as a New York resident even if you are domiciled elsewhere. Many NYC professionals who “move” to Florida while keeping their Manhattan apartment continue to be New York tax residents under this rule. Solution: give up the New York apartment entirely, or ensure fewer than 183 New York days.
High earner relocating from California to Texas (no state income tax): at $300,000 income, California effective rate ~9.3% = ~$27,900 savings. At $500,000: California effective ~10.5% = ~$52,500 savings. At $1,000,000: California effective ~11.8% = ~$118,000 savings. These savings compound over decades and, invested, represent millions in wealth differential over a career. For portable income earners (investors, business owners, remote workers, retirees), state tax arbitrage is one of the highest-return financial moves available.
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Get Expert Tax Help from Greenback →No. California’s 13.3% marginal rate only applies to income above $1,000,000 for single filers (the top 1% of earners). At $100,000 income, the effective California state income tax rate is approximately 6.8%. At $200,000 income, approximately 8.5%. Most Californians pay an effective rate well below the headline 13.3%.
New York City residents face the highest combined state plus local income tax burden. New York State top rate: 10.9%; New York City local: up to 3.876%; combined: up to 14.776% on income above $25M. For practical purposes, at $500,000 income, a New York City resident pays approximately 13.5–14% combined state and city income tax.
When all state and local taxes are combined (income, property, sales, excise), New York and California typically top the rankings by total tax burden as a percentage of income. New Jersey is also consistently high due to its combination of income tax and the nation’s highest property tax rates. By contrast, Wyoming and Alaska have the lowest total state and local tax burdens, benefiting from mineral severance taxes that allow low rates across other categories.
Generally yes, if you are physically working in Texas. California income tax applies to California-source income. If you are a Texas resident working remotely for a California employer and performing all your work in Texas, your income is Texas-source — not California-source. California does not impose a “California employer” tax on non-resident remote workers performing services entirely outside California. You should ensure your W-2 reflects your Texas work location and that you are established as a non-California resident.