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1 Jared Walczak, State Individual Income Tax Rates and Brackets for 2015 1 (2015)

handle is hein.taxfoundation/stindtxrb0001 and id is 1 raw text is: TX FOUNDATION F SCAL FACT Apr. 2015 No. 462 The Tax Foundation is a 501(c)(3) non-partisan, non-profit research institution founded in 1937 to educate the public on tax policy. Based in Washington, D.C., our economic and policy analysis is guided by the principles of sound tax policy: simplicity, neutrality, transparency, and stability. @2015 Tax Foundation Distributed under Creative Commons CC-BY NC 4.0 Editor, Melodie Bowler Designer, Dan Carvajal Tax Foundation 1325 G Street, NW, Suite 950 Washington, DC 20005 202.464.6200 taxfoundation.org State Individual Income Tax Rates and Brackets for 2015 By Jared Walczak Policy Analyst Individual income taxes are a major source of state government revenue, accounting for 35 percent of state tax collections.' Their prominence in public policy considerations is further enhanced by the fact that individuals are directly responsible for paying their income taxes, in contrast to the indirect payment of sales and excise taxes. To many taxpayers, the personal income tax is practically synonymous with their own tax burdens. Forty-three states levy individual income taxes. Forty-one tax wage and salary income, while two states-New Hampshire and Tennessee-exclusively tax dividend and investment income. Seven states levy no income tax at all. Of those states taxing wages, eight have single-rate tax structures, with one rate applying to all taxable income. Conversely, thirty-three states levy graduated-rate income taxes, with the number of brackets varying widely by state. Three states- Kansas, Nebraska, and Oregon-impose two-rate income taxes. At the other end of the spectrum, three states have ten or more tax brackets, led by Hawaii with twelve. Top marginal rates range from Pennsylvania's 3.07 percent to California's 13.3 percent. In some states, a large number of brackets are clustered within a narrow income band; Missouri taxpayers reach the state's tenth and highest bracket at $9,001 in annual income. In other states, the top marginal rate kicks in at $500,000 (New Jersey) or even $1,000,000 (California, if one counts the state's millionaire's tax surcharge). States' approaches to income taxes vary in other details as well. Some states double their single-bracket widths for married filers (avoiding the marriage penalty) and index tax brackets, exemptions, and deductions for inflation; many others do not. Some states tie their standard deductions and personal exemptions to the federal tax code, while others set their own or offer none at all. In the following table, we provide the most up-to-date data available on state individual income tax rates, brackets, standard deductions, and personal exemptions for both single and joint filers. 1 U.S. Census Bureau, State & Local Government Finance, Fiscal Year 2012, http://www.census.gov/govs/local/.

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