Additionally, as state governments reduce tax charges, they’re shifting nearer to a flat earnings tax fee. 13 states—Arizona, Colorado, Idaho, Illinois, Indiana, Kentucky, Michigan, Mississippi, New Hampshire, North Carolina, Pennsylvania, Utah and Washington—have already got a flat fee. In New Hampshire that fee applies solely to curiosity and dividends and in Washington solely to capital features.

And 7 states—Alaska, Florida, Nevada, South Dakota, Tennessee, Texas and Wyoming—have a zero earnings tax fee. You’ll be able to’t get flatter than zero. In complete, subsequently, 20 states have a flat earnings tax fee.

That is from David R. Henderson, “Extra Good Information on State Taxes,” Institute for Coverage Innovation, TaxBytes, February 23, 2023.

Learn the entire factor: it’s brief.