Top 10 Highest-Taxed States: Property, Income, and Sales Taxes

The highest taxed states in 2026, measured by what a median household actually pays in combined state and local taxes, are Illinois, New York, Connecticut, Pennsylvania, New Jersey, Kansas, Nebraska, Iowa, Ohio, and Texas. Illinois sits at the top with an effective rate of roughly 16.87 percent of household income once property, income, and sales taxes are added together.1WalletHub. States with the Highest and Lowest Tax Rates The order shifts if you measure differently, and it shifts even more once you factor in whether you’re working, retired, or earning far above the median.

The 10 Highest-Taxed States for 2026

The ranking below reflects total effective state and local tax burden on a household earning the median U.S. income of $81,211 and owning a home valued at $332,700. The three components show how each state gets there.1WalletHub. States with the Highest and Lowest Tax Rates

  • Illinois — 16.87% total. Property 8.24%, income 3.43%, sales and excise 5.19%.
  • New York — 14.95% total. Property 6.36%, income 3.80%, sales and excise 4.79%.
  • Connecticut — 14.58% total. Property 7.42%, income 1.40%, sales and excise 5.02%.
  • Pennsylvania — 14.09% total. Property 5.33%, income 4.11%, sales and excise 4.65%.
  • New Jersey — 14.06% total. Property 8.65%, income 1.11%, sales and excise 4.30%.
  • Kansas — 14.02% total. Property 5.28%, income 2.70%, sales and excise 5.35%.
  • Nebraska — 13.54% total. Property 6.09%, income 1.77%, sales and excise 4.86%.
  • Iowa — 13.37% total. Property 5.71%, income 2.09%, sales and excise 5.21%.
  • Ohio — 12.90% total. Property 5.38%, income 2.58%, sales and excise 4.95%.
  • Texas — 12.59% total. Property 6.11%, income 0.00%, sales and excise 6.48%.

Texas is the entry most people find surprising. It levies no state income tax at all, yet its property and sales taxes are heavy enough to push a median household past most states that do tax income. That single fact undoes the assumption that no-income-tax states are automatically cheap places to live.

What “Highest Taxed” Actually Measures

Different rankings use different math and produce different lists. The household-based method above models what a specific middle-income family would pay after adding up property, income, and sales taxes. A second common method divides total state and local tax collections by total personal income across the state. Under that aggregate approach, Hawaii has held the top spot for two consecutive years at 13.30 percent, followed by New York at 12.39 percent. Hawaii ranks high on the aggregate measure largely because tourism inflates sales and excise collections without adding to resident income.

Neither method is wrong; they answer different questions. If you earn near the median and own a typical home, the household model is what you want. If your income is well above the median, marginal rates and specific deductions matter more than either ranking. And if you’re retired, both lists will mislead you, because they assume wage income.

Where the Burden Actually Comes From

Property Taxes

Property taxes are the largest single driver in most of the top-ten states. For a median household, Illinois and New Jersey impose the heaviest effective property tax burdens in the country.1WalletHub. States with the Highest and Lowest Tax Rates In New Jersey, the typical homeowner pays more than $9,000 a year in real estate taxes, roughly 9 percent of median household income.2Courier-Post. NJ Is Nearly the Highest-Taxed State in the Nation, Study Finds Connecticut, Nebraska, and Texas earn their top-ten placement mostly through property taxes as well.

What makes property taxes uniquely painful is that they rise with home values, not with your income. A few states cap that growth. California’s Proposition 13 limits annual assessment increases to 2 percent regardless of actual market appreciation.3California Board of Equalization. How Property Is Assessed for Tax Purposes Florida caps homestead assessment growth at 3 percent, and Texas caps it at 10 percent. States without such caps see bills climb every reassessment cycle. Within any state, local jurisdictions can differ by a full percentage point or more, so the effective rate on the specific home you want to buy matters more than the statewide average.

Income Taxes

Individual income tax is the factor that varies most dramatically between states. Eight states charge no income tax at all: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, and Wyoming.4Tax Foundation. State Individual Income Tax Rates and Brackets, 2026 At the other end, California’s top marginal rate hits 13.3 percent on income above roughly $1 million, and a separate 1.1 percent uncapped payroll tax brings the effective all-in top rate to 14.4 percent.5Tax Foundation. California – 2026 State Tax Competitiveness Index Hawaii at 11.0 percent and New York at 10.9 percent follow.

Notice that California, despite that top marginal rate, doesn’t appear in the household top ten. Graduated brackets mean the top rate only applies to income above a high threshold, and a median household never gets near it. High marginal rates matter for high earners; they don’t drive the ranking for typical households.

Sales and Excise Taxes

Sales tax hits everyone at the same rate regardless of income, which makes it the most regressive part of the burden. The five states with the highest average combined state and local sales tax rates are Louisiana at 10.11 percent, Tennessee at 9.61 percent, Washington at 9.51 percent, Arkansas at 9.46 percent, and Alabama at 9.46 percent.6Tax Foundation. State and Local Sales Tax Rates, 2026 Only Washington shows up in the overall top ten. High sales taxes alone rarely push a state to the top; it takes heavy rates in at least two of the three categories.

Excise taxes on specific products add another layer that simple rate comparisons miss. State gasoline taxes range from 9 cents per gallon in Alaska to 70.9 cents in California.7U.S. Energy Information Administration. Many States Slightly Increased Their Taxes and Fees on Gasoline in the Past Year For a two-car household driving 25,000 miles a year, the gap between the highest and lowest state alone runs over $1,000 annually.

Retirees See a Different Map

The top-ten list changes substantially once wages stop. Thirteen states fully exempt traditional IRA and 401(k) distributions from state income tax, either because they have no income tax or because they specifically carve out retirement income. That group includes Alaska, Florida, Illinois, Michigan (starting with 2026 returns), Mississippi, Nevada, New Hampshire, Pennsylvania, South Dakota, Tennessee, Texas, Washington, and Wyoming.

Illinois is the most striking name on both lists. It ranks first for working households, yet exempts nearly all common retirement income. A retiree drawing from a 401(k) or pension faces a very different tax picture there than a wage earner does.

Social Security gets a separate rulebook. Nine states still tax Social Security benefits in 2026, though most offer significant exemptions by age or income. Colorado exempts residents 65 and older entirely. Connecticut exempts benefits for filers with adjusted gross income below $75,000 single or $100,000 joint. Minnesota provides full exemption up to $84,490 for single filers. West Virginia completed its phase-out in 2026, so benefits are fully exempt on returns filed in 2027. Utah taxes benefits at its 4.5 percent flat rate but offers a credit that eliminates the tax for individuals with modified AGI under $54,000 or joint filers under $90,000.

Moving to Escape a High-Tax State

Leaving a top-ten state for a cheaper one sounds simple. Tax authorities in the state you’re leaving disagree, especially when they’re losing a high-income filer. Most states treat you as a statutory resident if you keep a permanent place of abode there and spend more than 183 days in the state during the tax year. Some count partial days as full days; New York does. Hawaii requires 200 days, and Idaho sets the bar at 270.

Domicile is a separate test. It looks at where you vote, where your driver’s license is issued, where your primary bank accounts sit, and where your social and professional ties are anchored. Auditors reviewing a change from New York to Florida will pull cell phone records, credit card transactions, and social media check-ins. Buying a condo in a no-income-tax state while keeping your old home in a high-tax state usually does not settle the question.

Remote work adds another trap. Several states apply a “convenience of the employer” rule, taxing nonresident employees as if they were physically in the state when they work remotely for their own convenience rather than because the employer requires it. New York enforces this most aggressively, and administrative rulings suggest the rule can reach employees who never set foot in the state. Connecticut, Delaware, Nebraska, and Pennsylvania enforce versions of it as well.8Tax Foundation. Teleworking Employees Face Double Taxation Living in New Hampshire and working remotely for a New York employer may not get you out of New York income tax.

Which state is the “highest taxed” depends on who’s asking. High earners should weigh top marginal income rates. Home buyers should focus on the effective property tax on the specific home and county. Retirees should look at how their income sources are treated, not at any list built around wages. The single ranking that fits every reader does not exist.