State Income Tax (SIT) refers to the tax imposed by individual U.S. states on an individual's income. While the federal government collects federal income tax, each state has the authority to levy its own tax on residents' income earned within that state's borders. State income tax rates and regulations can vary significantly from one state to another.
Some states have a flat tax rate, meaning everyone pays the same percentage of their income. Other states have a progressive tax system, where higher income levels are subject to higher tax rates. Some states also offer deductions, exemptions, and credits that can affect the amount of state income tax an individual owes.
How State Income Tax Is Computed: State income tax is determined by these factors:
- Gross earnings (income before deductions)
- Pay frequency
- Employee's state withholding allowance
- Additional specified withholdings
- Marital status
- Wage base limits
- Exemptions
- Pre-tax benefits
Supplemental Wage Withholding Rates by State (for income tax): Some states use a range based on wage amount. Rates apply across calculation methods (current aggregation, flat, and previous aggregation), unless specified otherwise.
| State | Withholding rate |
| Alabama | 5% |
| Alaska | No income tax |
| Arizona | No supplemental rate |
| Arkansas | 6.9% |
| California | 6.6% - 10.23% |
| Colorado | 4.63% |
| Connecticut | No supplemental rate |
| Delaware | No supplemental rate |
| District of Columbia | No supplemental rate |
| Florida | No income tax |
| Georgia | 2% - 5.75% |
| Hawaii | No supplemental rate |
| Idaho | 6.925% |
| Illinois | 4.95% |
| Indiana | 3.23% |
| Iowa | 6% |
| Kansas | 5% |
| Kentucky | No supplemental rate |
| Louisiana | No supplemental rate |
| Maine | 5% |
| Maryland | No supplemental rate |
| Massachusetts | No supplemental rate |
| Michigan | 4.25% |
| Minnesota | 6.25% |
| Mississippi | No supplemental rate |
| Missouri | 5.4% |
| Montana | 6% |
| Nebraska | 5% |
| Nevada | No income tax |
| New Hampshire | No income tax |
| New Jersey | No supplemental rate |
| New Mexico | 4.9% |
| New York | 9.62% |
| North Carolina | 5.35% |
| North Dakota | 1.84% |
| Ohio | 3.5% |
| Oklahoma | 5% |
| Oregon | 8% |
| Pennsylvania | 3.07% |
| Rhode Island | 5.99% |
| South Carolina | 7% |
| South Dakota | No income tax |
| Tennessee | No income tax |
| Texas | No income tax |
| Utah | No supplemental rate |
| Vermont | 6.6% (30% of the Federal rate on payments up to $1M, and 11.1% on payments more than $1M) |
| Virginia | 5.75% |
| Washington | No income tax |
| West Virginia | 3% - 6.5% |
| Wisconsin | 4 %, 5.84%, 6.27% or 7.65% depending on the gross salary of the employee |
| Wyoming | No income tax |
Disclaimer:
This article is not financial, legal, or HR advice. Regulations change, so consult experts for guidance.