Friday, April 2, 2021

Here Is How Much People Pay in Taxes in Tennessee

by Grant Suneson, 24/7 Wall St. via The Center Square - Each year, Americans dread April 15 -- Tax
Day. However, the IRS announced in March that American taxpayers would have an extra month to file their federal income taxes, pushing Tax Day to May 17 in the wake of the COVID-19 pandemic.  However, state filings will still proceed as planned in most places. 

In 2019, the average state and local tax burden was 10.3% of income, but this figure varied widely from state to state -- ranging from less than 6% to over 14%, meaning differences of thousands of dollars in a given year. 

To determine the states where Americans are paying the most taxes, 24/7 Wall St. reviewed data on state tax burdens from tax policy nonprofit the Tax Foundation.

States were ranked based on state and local taxes paid by each state's residents as a percentage of that state's net national product in 2019. State income figures are based on net national product, which measures the value of goods and services produced by U.S. residents, minus the value of the fixed capital used in production. 

To calculate tax burdens the Tax Foundation included different kinds of taxes, -- on purchases like property, public utilities, alcohol, fuel, and general sales, as well as taxes on incomes, inheritance, and many other financial transactions. Property taxes can sometimes make up a large share of total tax burdens, depending on the state in which the property is located. While some states have property taxes of under $1,000 per capita, residents of other states pay over $3,000 per person in property taxes. These are the states with the highest property taxes. 

The state and local tax burden in Tennessee in 2019, represented 7.0% of incomes in the state. This tax burden was tied for the second lowest among states and well below the overall national tax burden of 10.3%. 

On a per capita basis, Tennessee residents paid $3,368 in state and local taxes, the lowest among states and lower than the national per capita taxes paid of $5,755. 

The tax burden in Tennessee has decreased in recent years. In 2010, the state and local tax burden represented 7.9% of incomes in the state, tied for second lowest of all states.

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