Delaware State Tax Guide
Delaware state tax rates and rules for income, sales, property, fuel, cigarette, and other taxes that impact Delaware residents.
Delaware State Tax: Overview
You can enjoy making tax-free purchases in Delaware since it is one of the states with no sales tax. The property tax rate in Delaware is relatively low, and the state won't tax income below $2,000.
Delaware's highest income tax bracket is 6.6%, but if you have taxable income greater than $60,000, you will pay the 6.6% rate.
[Data for this state tax guide was gathered from several sources including the U.S. Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.]
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Delaware Income Tax
Delaware tax on retirement benefits: Delaware does not tax Social Security benefits or Railroad Retirement benefits. Retirees age 60 and older may exclude up to $12,500 of pension or retirement income from a qualified retirement plan in Delaware. This income includes but is not limited to:
- Interest income
- Capital gains income
- Net rental income
- Income from dividends
(Note: The pension exclusion is limited to $2,000 for taxpayers under 60.)
Delaware Income Tax Range
Delaware's income tax brackets are the same for every filing status. The city of Wilmington imposes its own income tax rate.
Up to $2,000 | 0% |
$2,001 to $5,000 | 2.2% |
$5,001 to $10,000 | 3.9% |
$10,001 to $20,000 | 4.8% |
$20,001 to $25,000 | 5.2% |
$25,001 to $60,000 | 5.55% |
More than $60,000 | 6.6% |
Delaware Sales Tax
Delaware does not impose any state or local sales tax.
How Much Are Property Taxes in Delaware?
In Delaware, the average effective property tax rate is 0.58%, which is lower than in most other U.S. states.
Delaware Property Tax Breaks for Retirees
Senior Property Tax Credit: Some homeowners can get a property tax credit of up to $500 against school property taxes. Delaware requires homeowners meet certain eligibility criteria to qualify for the credit.
- Homeowners must have paid their entire property tax bill for the prior year.
- The property must be the homeowner's primary residence.
- Homeowners must be 65 or older.
Note: If one spouse is not yet 65, the other spouse may apply for the school property tax credit when the home is jointly owned.
Delaware Motor Vehicle Taxes
Delaware taxes gasoline at $0.23 per gallon.
Delaware does not impose sales tax or personal property tax on motor vehicles.
Delaware Alcohol and Tobacco Taxes
Cigarettes | $2.10 per pack |
Other tobacco products | 30% of wholesale price |
Vapor products | $0.05 per ml |
Beer | $0.26 per gallon (rounded to the nearest cent) |
Wine | $1.63 per gallon |
Liquor (25% or less ethyl alcohol by volume) | $3.00 per gallon |
Liquor (More than 25% ethyl alcohol by volume) | $4.50 per gallon |
Delaware Estate and Inheritance Taxes
Delaware is one of the states with no estate or inheritance taxes.
Related Content
Katelyn has more than 6 years’ experience working in tax and finance. While she specializes in tax content, Katelyn has also written for digital publications on topics including insurance, retirement and financial planning and has had financial advice commissioned by national print publications. She believes that knowledge is the key to success and enjoys helping others reach their goals by providing content that educates and informs.
-
Seven Steps Couples Should Take Before Blending Their Finances
Getting on the same page now can ensure you remain successful throughout your relationship.
By Kiplinger Advisor Collective Published
-
Charitable Remainder Trust: The Stretch IRA Alternative
The SECURE Act killed the stretch IRA, but a properly constructed charitable remainder trust can deliver similar benefits, with some caveats.
By Brandon Mather, CFP®, CEPA, ChFEBC® Published
-
Retirees Face Significant Tax Bills Due to Fraud
Fraud A new report sheds light on how older adult scam victims end up with big tax bills and lost retirement savings.
By Kelley R. Taylor Last updated
-
Tax Day: Is the Post Office Open Late?
Tax Filing Tax Day means some people need to mail their federal income tax returns.
By Kelley R. Taylor Published
-
High Earners: Beware of These Illegal Schemes to Lower Taxes
Tax Schemes The IRS says high-income filers are targets for several illegal tax schemes.
By Katelyn Washington Last updated
-
Mailing Your Tax Return This Year? What to Know Before You Do
Tax Filing There are plenty of reasons not to mail your tax return this year, but here’s what you should know if you are.
By Katelyn Washington Last updated
-
IRS Warning: Beware of Smishing and 'Helper' Tax Scams
Scams Tax season is a time to look out for email and text message scams.
By Kelley R. Taylor Last updated
-
Most Expensive States to Live in for Homeowners
Property Taxes High property tax bills make the places on this list the most expensive states for homeowners to live in.
By Katelyn Washington Last updated
-
Don’t Miss This $2,500 Tax Break for Paying Your Student Loan
Tax Deductions Do you qualify for the student loan interest deduction this year?
By Katelyn Washington Last updated
-
How Much Richer Could You Be Without a Big Tax Refund?
Tax Refunds A big tax refund isn’t a reason to celebrate if you overpaid throughout the year. Here’s how much money your interest-free loan to the government could have cost you.
By Katelyn Washington Last updated