California considered to have the highest personal income tax rate

With record-high inflation increasing the cost of daily necessities, like gas and food, Americans are trying to save money wherever possible.

However, there is one expense no one can avoid: taxes

Inflation has hit these California cities the hardest

According to Intuit TurboTax, California, with a 13.3% top rate, is considered to have the highest personal income tax. However, that tax percentage doesn’t affect everyone.

The 13.3% rate applies to Californians who make more than $1 million. Otherwise, the state’s tax rates go from 1% up to 12.3% depending on someone’s income, which can still be high.  

Here are the 10 states with the highest personal income tax rates

1. California: 13.3%
2. Hawaii: 11%
3. New Jersey: 10.75%
4. Oregon: 9.9%
5. Minnesota: 9.85%
6. District of Columbia: 8.95%
7. New York: 8.82%
8. Vermont: 8.75%
9. Iowa: 8.53%
10. Wisconsin: 7.65%

A total of eight states, Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming, don’t tax residents’ income but do tax other assists like property.

According to the 2020 U.S Census Bureau, the median household income in California is $78,672. With that income, a single taxpayer would be in the 9.3% tax bracket and pay $4,321.00 in taxes excluding other expenses, according to the 2021 California tax calculator.

A full breakdown of the state's personal income tax bracket can be found here.

With high-income tax rates in the Golden State, some residents wonder what the money is used for.

Generally, tax money is used to pay for public primary education, parks, roads, and public safety, according to the state’s Legislative Analyst’s Office.

The income tax money is used to fund that state’s budget.

Luckily, some financial relief could be on the way for some Californians.

California's Middle-Class Tax Refund has been sent out to more than half of eligible residents through direct deposits or a debit card.

The Franchise Tax Board, the state agency in charge of disbursing the payments, says at least 6,739,880 direct deposits have been issued and 2,556,729 debit cards have been sent out, according to the latest numbers available.

About 5 billion has been paid out so far.

‘Where’s my California inflation relief?’ and other questions answered

The state hopes to get all payments out by the end of January 2023.

from KTLA https://ift.tt/VKMpTUZ