New York residents pay an effective state and local tax rate of 14.95% — nearly four percentage points above the national average — making the Empire State the second highest-taxed in the entire country, according to a new analysis by WalletHub.

Only Illinois residents carry a heavier tax burden. For the millions of New Yorkers filing their returns ahead of the April 15 federal deadline, that ranking is more than a statistic. It translates directly into thousands of dollars leaving their pockets every single year.

The findings arrive at a moment when household budgets are already stretched thin, and when the question of where you live is increasingly shaping how much financial breathing room you actually have.

What the WalletHub Study Actually Found

The analysis ranked all 50 states and Washington, D.C. by overall tax burden — the combined weight of state and local taxes as a percentage of income. New York ranked 50th out of 51, meaning nearly every other state in the country is cheaper for taxpayers.

The national average effective tax rate sits at 11.02%. New York’s rate of 14.95% is 35.75% higher than that average. Put another way, New Yorkers are paying more than a third above what the typical American household pays in state and local taxes.

For a household earning the median U.S. income of approximately $81,211 per year, that difference is stark. In New York, that household would owe roughly $12,143 annually in state and local taxes alone — before a single federal dollar is counted.

The Four Categories Driving New York’s Tax Burden

The WalletHub study broke down tax burdens across four major categories. Together, they paint a picture of why New York consistently ranks near the bottom for affordability.

Real estate taxes — Property taxes in New York are among the highest in the nation, particularly in the New York City metro area and Long Island.
Income taxes — New York imposes some of the steepest state income tax rates in the country, with New York City residents also facing a separate city-level income tax on top of state rates.
Sales and excise taxes — Combined state and local sales taxes add another layer of cost on everyday purchases.
Vehicle property taxes — Taxes tied to vehicle ownership contribute to the overall burden, though this category carries less weight in New York than in some other high-tax states.

According to the report, it is primarily the property and income tax categories that push New York’s overall ranking to near the bottom of the national list.

New York vs. the Nation: The Numbers Side by Side

Metric
New York
National Average

Effective State & Local Tax Rate
14.95%
11.02%

Annual Tax on Median Household Income ($81,211)
~$12,143
Not specified

Tax Burden vs. National Average
35.75% higher
—

Overall Ranking (out of 51)
50th
—

Only State Ranked Lower
Illinois
—

What This Means for Real New York Households

The practical impact of this ranking is felt differently depending on where in New York you live. Downstate residents — particularly those in New York City and its suburbs — face the compounding effect of city income taxes layered on top of state income taxes, plus some of the highest property values and corresponding property tax bills in the country.

Upstate residents may face lower property values and no city income tax, but still contend with a state income tax structure that is among the most aggressive in the nation. No corner of the state is insulated from the overall burden that pushes New York’s rate nearly 15 cents on every dollar of income.

For families making decisions about where to live, where to retire, or where to locate a business, the gap between New York and lower-tax states represents a very real financial calculation. Over a decade, a household paying $12,143 annually in state and local taxes is looking at more than $121,000 in cumulative tax costs — before accounting for any income growth.

Critics of New York’s tax structure argue the burden has long discouraged residents and businesses from staying in the state. Supporters of the current structure contend that the taxes fund services, infrastructure, and social programs that lower-tax states simply do not provide at the same level. That debate has persisted in Albany for decades without resolution.

Where This Conversation Goes From Here

With tax season in full swing and the April 15 federal deadline approaching, the WalletHub rankings are landing at a moment when New Yorkers are already thinking hard about what they owe and where that money goes.

The study does not project any specific policy changes, and no legislative proposals tied directly to these findings were cited in the analysis. What it does offer is a clear, data-driven snapshot of where New York stands relative to the rest of the country — and the answer, for the second year running, is near the very bottom.

Whether that ranking prompts action in Albany or simply reinforces what many residents already feel every April is a question that remains open. For now, the math is straightforward: living in New York costs more, and taxes are a significant part of why.

Frequently Asked Questions

What is New York’s overall tax burden ranking in the United States?
New York ranks 50th out of 51 (all 50 states plus Washington, D.C.), according to WalletHub’s analysis, making it the second highest-taxed state in the country. Only Illinois ranks lower.

What is New York’s effective state and local tax rate?
According to the WalletHub study, New York’s effective total state and local tax rate is 14.95%, compared to a national average of 11.02%.

How much does the average household pay in state and local taxes in New York?
Based on a median U.S. household income of approximately $81,211 per year, the estimated annual state and local tax bill in New York is roughly $12,143.

What types of taxes are included in the tax burden calculation?
The WalletHub analysis included four categories: real estate taxes, income taxes, sales and excise taxes, and vehicle property taxes.

Which state has the highest tax burden in the country?
Illinois ranks 51st — last — in the WalletHub study, carrying a higher overall tax burden than even New York.

Is New York’s tax burden expected to change soon?
The study does not address upcoming policy changes, and no specific legislative proposals tied to these findings were confirmed in