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When you look at your pay stub, you'll typically see two separate income tax withholdings: federal income tax and state income tax. While both reduce your take-home pay, they work differently, fund different programs, and vary significantly in amount.
Federal income tax is collected by the IRS and funds federal government programs including national defense, Social Security, Medicare, federal highways, and more. It uses a progressive tax bracket system — meaning higher income is taxed at higher rates, but only the portion within each bracket.
| 2026 Bracket | Single | Married Filing Jointly |
|---|---|---|
| 10% | Up to $11,925 | Up to $23,850 |
| 12% | $11,925 – $48,475 | $23,850 – $96,950 |
| 22% | $48,475 – $103,350 | $96,950 – $206,700 |
| 24% | $103,350 – $197,300 | $206,700 – $394,600 |
| 32% | $197,300 – $250,525 | $394,600 – $501,050 |
| 35% | $250,525 – $626,350 | $501,050 – $751,600 |
| 37% | Over $626,350 | Over $751,600 |
Source: IRS Rev. Proc. 2025-xx. Standard deduction: $16,100 (single) / $32,200 (MFJ) in 2026.
State income tax is collected by your state government and funds state programs including schools, roads, police, and public services. State tax rates vary enormously — from zero in nine states to over 13% in California.
| Category | States | Rate |
|---|---|---|
| No state income tax | TX, FL, NV, WA, WY, SD, TN, AK, NH | 0% |
| Low rate (flat) | IN (3%), PA (3.07%), CO (4.4%) | 3–4.4% |
| Medium rate | GA (5.5%), MA (5%), AZ (2.5%) | 2.5–5.5% |
| High rate | CA (up to 13.3%), HI (8%), MN (9.85%) | 8–13.3% |
| Feature | Federal Tax | State Tax |
|---|---|---|
| Who collects it | IRS (federal government) | State revenue department |
| Rate structure | Progressive (10%–37%) | Varies — flat or progressive |
| Applies everywhere | Yes — all 50 states | No — 9 states have $0 |
| Standard deduction | $16,100 (single, 2026) | Varies by state |
| Filed with | Form 1040 (April 15) | State return (varies) |
| What it funds | Federal programs | State programs |
🌵 Texas (no state tax)
🌊 California (9.3% rate)
Illustrative estimates only. Actual tax depends on deductions, credits, and individual circumstances.
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