To determine the most tax-friendly states for the rich, 24/7 Wall St. analyzed the effective tax rates for the top 1% of earners using data from the Institute on Taxation & Economic Policy’s 2018 report “Who Pays? A Distributional Analysis of the Tax Systems in All 50 States.” Effective tax rates are the estimated amounts paid in state and local taxes as a percentage of income, and were modeled by ITEP using tax laws as they existed as of Sept. 10, 2018 and 2015 income levels.
Data on the average income of individuals in the top 1% of earners also came from ITEP.
We also considered effective income tax and sales tax rates by state from the Tax Foundation, a tax policy advocacy group. Tax Foundation data is for fiscal 2016, the most recent year available.
Sponsored: Find a Qualified Financial Advisor
Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.