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New York Taxpayers Versus Other Americans

February 9, 2018

Though all American taxpayers are subject to the same federal system of taxation, New York taxpayers face a higher than average tax burden.

Many people forget or never focus on the wide variation in state level taxation. State level taxation varies both in terms of degree and kind: states impose a wide range of income, sales and property taxes. Residents of some states, such as Washington state, face no state level income tax at all, while others, such as New York taxpayers, face a considerable income tax burden. Taxation at the state level varies enough that it can have a significant impact on one’s quality of life. If a given taxpayer be required to pay an additional state income tax of 10 percent, for instance, this clearly will have an appreciable effect on that person’s overall lifestyle.  

In this article, we will take a look at the variation in state level taxation around the country and try to give a sense of where New York taxpayers stand among Americans from other states. As we will see, New York taxpayers tend to bear a tax burden which is on the heavy side compared with other state taxpayers.  

State Taxes in New York 

All  New York taxpayers potentially face income, sales and real property taxes. Currently, the top state income tax bracket for New York taxpayers is 8.82%. Various sales tax rates are imposed on different products and services; for all of the rates, taxpayers should consult Publication 750 from New York’s Department of Taxation and Finance. Real property taxes are assessed based on the property’s fair market value. Different jurisdictions within New York state impose different real property tax rates, so New York taxpayers should check to determine which rates apply to them.  

Residents of New York City may also have to pay city level taxes in addition to their New York State taxes. The current top city level income tax rate for New York City residents is 3.876% and applies to incomes in excess of $90,000. Residents of Yonkers also face a city tax, and certain businesses in the New York City metropolitan area may also be liable for the MCTMT as well. 

Where New York Taxpayers Stand  

Unfortunately, no matter which perspective you take, it’s clear that residents of New York have to cope with a heavy tax burden when compared with other Americans. In fact, if you combine income, sales and property taxes together, New York taxpayers face the toughest tax bill in the country. After New York, residents of Hawaii and Vermont face the second and third heaviest state tax burdens with combined rates of 11.27% and 10.75%, respectively (as of April of 2017). If you’re a resident of Tennessee, Alaska or Delaware, though, consider yourself particularly lucky: denizens of these states face the lightest tax burdens by a comfortable margin.  

This may seem like depressing news, but be aware that there are mitigating factors. New York taxpayers, particularly those who reside within certain sections of New York City, typically have access to higher wages as compared to other areas around the country. What’s more, the upkeep and maintenance requirements of the State of New York are such that a relatively heavy state tax burden is practically a necessity. 

Regardless of your individual circumstances, it’s important that you reach out to an experienced New York tax attorney for counsel on your tax issues. As we’ve pointed out in this article, the layers of federal and state taxation are many, and pairing up with a qualified tax professional can bring you many, many benefits. With offices in Albany, New York City, Rochester, Syracuse, Utica and Watertown, New York taxpayers have the tax professionals at Mackay, Caswell & Callahan, P.C. are here to help you.

Image credit: Marcela

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Comments

A Practical Guide to Filing NYC Tax Returns | New York Tax Attorney 5 years ago

[…] tax system here in the State of New York is a complex, layered system involving various kinds of taxes, forms, credits and exemptions. A survey of this vast system shows […]

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[…] tax system here in the State of New York is a complex, layered system involving various kinds of taxes, forms, credits and exemptions. A survey of this vast system shows […]

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[…] tax system here in the State of New York is a complex, layered system involving various kinds of taxes, forms, credits and exemptions. A survey of this vast system shows […]

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