state tax

Kiplinger's Tax Map for Middle-Class Families: About Our Methodology

The research behind our judgments.

Our tax map for middle-class families and related tax content includes data from a wide range of sources. To generate our rankings, we created a metric to compare the tax burden for a hypothetical middle-class family in all 50 states and the District of Columbia.

Kiplinger Tax Map

Data Sources:

Income Taxes – Our income tax information comes from each state's tax agency. Income tax forms and instructions were also used. See more about how we calculated the income tax for our hypothetical family below under "Ranking method."

Property Taxes – The median property tax rate is based on the median property taxes paid and the median home value in each state for 2019 (the most recent year available). The data comes from the U.S. Census Bureau.

Sales Taxes – State sales tax rates are from each state's tax agency. We also cite the Tax Foundation's 2021 midyear average combined sales tax rate, which is a population-weighted average of state and local sales taxes. In states that let local governments add sales taxes, this gives an estimate of what most people in a given state actually pay, as those rates can vary widely.

Motor Fuel Taxes – The American Petroleum Institute prepares semi-annual reports of state motor fuel tax rates. We used July 2021 data but made several updates to reflect new rates effective since July 1, 2021. Values include excise taxes, sales taxes (when applicable) and a variety of fees that states impose.

Sin Taxes – Information about "sin taxes" on tobacco products, alcoholic beverages, and marijuana comes from a variety of sources, including state tax agencies, Federation of Tax Administrators, Campaign for Tobacco-Free Kids, and Distilled Spirits Council of the United States

Annual Car Taxes and Fees – We used information from state tax agencies and state motor vehicle departments for annual car taxes and fees.

Estate and Inheritance Taxes – Data from each state tax agency was used for estate and inheritance tax information.

Ranking Method:

The "tax-friendliness" of a state depends on the sum of income, sales and property taxes paid by our hypothetical middle-class family.

To determine the income tax component, we prepared tax returns for each state and the District of Columbia for a married couple with two dependent children, an earned income of $77,000, long-term capital gains of $1,500, qualified dividends of $1,000, and taxable interest of $500. They had $4,500 in state income taxes withheld from their wages. They also paid $3,000 in real estate taxes, paid $2,800 in mortgage interest, and donated $2,300 (cash and property) to charity. We calculated these 2020 returns using software from Credit Karma (some adjustments were made to account for certain 2021 tax law changes).

How much they paid in sales taxes was calculated using the sales tax deduction tables in the instructions for federal Schedule A (Form 1040) and the Tax Foundation's 2021 midyear average combined sales tax rates.

How much the hypothetical family paid (and deducted on their income tax return) in property taxes was calculated by assuming a residence with $300,000 assessed value and then applying each state's median property tax rate to that amount.

Most Popular

Your Guide to Roth Conversions
Special Report
Tax Breaks

Your Guide to Roth Conversions

A Kiplinger Special Report
February 25, 2021
The 12 Best Tech Stocks to Buy for 2022
tech stocks

The 12 Best Tech Stocks to Buy for 2022

The best tech-sector picks for the year to come include plays on some of the most exciting emergent technologies, as well as several old-guard mega-ca…
January 3, 2022
How to Know When You Can Retire
retirement

How to Know When You Can Retire

You’ve scrimped and saved, but are you really ready to retire? Here are some helpful calculations that could help you decide whether you can actually …
January 5, 2022

Recommended

Kiplinger's Tax Map for Retirees: About Our Methodology
retirement

Kiplinger's Tax Map for Retirees: About Our Methodology

Here's how we put together our Retiree Tax Map and related content.
December 17, 2021
10 Least Tax-Friendly States for Retirees
retirement

10 Least Tax-Friendly States for Retirees

Retirees in these states are likely to have a higher overall state and local tax burden than retirees in other states.
December 17, 2021
10 Most Tax-Friendly States for Retirees
retirement

10 Most Tax-Friendly States for Retirees

Moving to a low-tax state in retirement can help make your retirement savings last longer.
December 17, 2021
Taxes on Unemployment Benefits: A State-by-State Guide
state tax

Taxes on Unemployment Benefits: A State-by-State Guide

Don't be surprised by an unexpected state tax bill on your unemployment benefits. Know where unemployment compensation is taxable and where it isn't.
December 13, 2021