The Real Value of a Raise by State (2026): All 50 States + DC Ranked
Original analysis: the same $3,750 raise, run through every state's actual income tax code and BEA regional price data, ranked from best to worst.
Where a Raise Is Worth the Most (and Least)
We took the same raise — a 5% increase on a $75,000 salary ($3,750), single filer — and computed what it's actually worth after federal tax, state tax, FICA, and regional cost-of-living, in all 50 states and DC. The real, purchasing-power-adjusted value of that raise ranges from $2,994 in South Dakota to $2,043 in California — a 47% spread for the exact same nominal raise. No-income-tax states dominate the top of the list, but the ranking isn't just "no state tax wins" — cost of living reorders it substantially once you get past the top few.
- The same $3,750 raise is worth $2,994 in real terms in South Dakota but only $2,043 in California — a 47% gap driven entirely by state tax code and regional prices.
- No-income-tax states dominate the top of the list — South Dakota, Wyoming, Tennessee, Nevada, Texas, Florida, New Hampshire, Alaska, Washington all keep 70.3% of the raise before cost-of-living adjustment — but their rank still varies once BEA regional price parities are applied, because prices differ even among no-tax states.
- High-tax, high-cost states cluster at the bottom — California, DC, Hawaii, New Jersey, and Oregon all fall in the bottom 5 for real raise value, combining above-average state tax with above-average cost of living.
- This is a fixed, nominal raise scenario — the ranking would shift somewhat at different income levels because state brackets are progressive, but the broad pattern (no-tax and lower-cost states winning) holds across most salary ranges.
This table uses a fixed $75,000/5% scenario for comparability. Plug in your own salary, state tax rate, and raise to see your personal after-tax and inflation-adjusted number.
Calculate your own raiseAll 50 States + DC, Ranked by Real Raise Value
Scenario held constant across every row: $75,000 current salary, 5% raise ($3,750), single filer, 2026 federal tax brackets, real 2026 state income tax brackets for each jurisdiction, FICA (6.2% Social Security up to the wage base + 1.45% Medicare), then adjusted for each state's 2023 BEA Regional Price Parity (the most recent published year).
| Rank | State | After-Tax Gain (Nominal) | % of Raise Kept | RPP (100 = US avg) | Real (COL-Adjusted) Gain |
|---|---|---|---|---|---|
| 1 | South Dakota | $2,638.12 | 70.3% | 88.1 | $2,994.47 |
| 2 | Wyoming | $2,638.12 | 70.3% | 90.8 | $2,905.42 |
| 3 | North Dakota | $2,561.62 | 68.3% | 88.6 | $2,891.22 |
| 4 | Louisiana | $2,525.62 | 67.3% | 88.3 | $2,860.28 |
| 5 | Arkansas | $2,473.12 | 66.0% | 86.5 | $2,859.10 |
| 6 | Tennessee | $2,638.12 | 70.3% | 92.5 | $2,852.03 |
| 7 | Mississippi | $2,461.88 | 65.7% | 87.3 | $2,820.02 |
| 8 | Iowa | $2,495.62 | 66.5% | 88.8 | $2,810.39 |
| 9 | Oklahoma | $2,460.00 | 65.6% | 88.3 | $2,785.96 |
| 10 | Ohio | $2,534.44 | 67.6% | 91.8 | $2,760.83 |
| 11 | Kentucky | $2,488.12 | 66.3% | 90.5 | $2,749.31 |
| 12 | Indiana | $2,525.62 | 67.3% | 92.2 | $2,739.29 |
| 13 | Alabama | $2,450.62 | 65.3% | 90.0 | $2,722.92 |
| 14 | Nevada | $2,638.12 | 70.3% | 97.0 | $2,719.72 |
| 15 | New Mexico | $2,454.37 | 65.4% | 90.4 | $2,715.02 |
| 16 | Texas | $2,638.12 | 70.3% | 97.2 | $2,714.12 |
| 17 | Nebraska | $2,443.12 | 65.1% | 90.4 | $2,702.57 |
| 18 | Kansas | $2,424.38 | 64.6% | 90.0 | $2,693.75 |
| 19 | Missouri | $2,458.12 | 65.5% | 91.8 | $2,677.70 |
| 20 | West Virginia | $2,394.38 | 63.8% | 89.8 | $2,666.34 |
| 21 | Idaho | $2,424.56 | 64.7% | 91.4 | $2,652.69 |
| 22 | Montana | $2,379.38 | 63.4% | 90.2 | $2,637.89 |
| 23 | North Carolina | $2,478.75 | 66.1% | 94.1 | $2,634.17 |
| 24 | Michigan | $2,478.75 | 66.1% | 94.2 | $2,631.37 |
| 25 | Wisconsin | $2,439.38 | 65.0% | 93.1 | $2,620.17 |
| 26 | Utah | $2,467.50 | 65.8% | 95.0 | $2,597.37 |
| 27 | Alaska | $2,638.12 | 70.3% | 101.7 | $2,594.03 |
| 28 | Pennsylvania | $2,523.00 | 67.3% | 97.5 | $2,587.69 |
| 29 | South Carolina | $2,405.62 | 64.1% | 93.2 | $2,581.14 |
| 30 | Florida | $2,638.12 | 70.3% | 103.5 | $2,548.91 |
| 31 | Georgia | $2,436.00 | 65.0% | 96.7 | $2,519.13 |
| 32 | Arizona | $2,544.38 | 67.8% | 101.1 | $2,516.69 |
| 33 | New Hampshire | $2,638.12 | 70.3% | 105.3 | $2,505.34 |
| 34 | Illinois | $2,452.50 | 65.4% | 98.9 | $2,479.78 |
| 35 | Vermont | $2,390.62 | 63.7% | 96.6 | $2,474.77 |
| 36 | Rhode Island | $2,497.50 | 66.6% | 101.4 | $2,463.02 |
| 37 | Maine | $2,380.80 | 63.5% | 97.1 | $2,451.91 |
| 38 | Colorado | $2,473.12 | 65.9% | 101.4 | $2,438.98 |
| 39 | Washington | $2,638.12 | 70.3% | 108.6 | $2,429.21 |
| 40 | Minnesota | $2,383.12 | 63.5% | 98.4 | $2,421.87 |
| 41 | Delaware | $2,390.62 | 63.7% | 99.3 | $2,407.48 |
| 42 | Virginia | $2,422.50 | 64.6% | 100.7 | $2,405.66 |
| 43 | Maryland | $2,460.00 | 65.6% | 104.0 | $2,365.38 |
| 44 | Connecticut | $2,431.88 | 64.8% | 103.7 | $2,345.11 |
| 45 | Massachusetts | $2,450.62 | 65.3% | 108.2 | $2,264.90 |
| 46 | New York | $2,418.75 | 64.5% | 107.6 | $2,247.91 |
| 47 | Oregon | $2,310.00 | 61.6% | 104.7 | $2,206.30 |
| 48 | New Jersey | $2,399.25 | 64.0% | 108.9 | $2,203.17 |
| 49 | Hawaii | $2,328.75 | 62.1% | 108.6 | $2,144.34 |
| 50 | District of Columbia | $2,319.38 | 61.9% | 110.8 | $2,093.30 |
| 51 | California | $2,299.88 | 61.3% | 112.6 | $2,042.52 |
Why the Ranking Isn't Just "No-Tax States Win"
Eight states have no income tax at all — South Dakota, Wyoming, Tennessee, Nevada, Texas, Florida, New Hampshire (wages), Alaska, and Washington — and every one of them keeps the same 70.3% of the nominal raise before any cost-of-living adjustment. But once regional prices enter the picture, they split apart: South Dakota (RPP 88.1) ranks #1 while Washington (RPP 108.6) drops to #39, despite both states withholding zero income tax on the raise. The tax code sets the floor; the cost of living decides the final rank.
The bottom of the list tells the same story in reverse
California doesn't just have a high top marginal rate — even at $75,000–$78,750 the state's progressive brackets take a real bite, and California's 112.6 RPP (12.6% above the national average, driven mostly by housing) compounds it. The same pattern shows up in DC, Hawaii, and New Jersey: above-average state tax stacked on above-average prices.
Because most state brackets are progressive, the exact ranking would shift somewhat at a $40,000 salary or a $200,000 salary — flatter or lower-bracket states would compress the gap, while states with steep top brackets (California, New York, Hawaii, New Jersey) would separate further from the pack at higher incomes. The broad pattern — no-tax and lower-cost states winning, high-tax and high-cost states losing — holds across most realistic salary ranges, but the precise dollar figures in this table are specific to the $75,000/5% scenario shown.
Methodology & Sources
- 12026 Federal Income Tax Brackets — IRS Rev. Proc. 2025-32, 2025
- 2Regional Price Parities by State and Metro Area, 2023 — U.S. Bureau of Economic Analysis, released Dec 12, 2024
- 32026 Social Security COLA Fact Sheet — Social Security Administration, 2026
- 4State Individual Income Tax Rates and Brackets — Tax Foundation, 2025-2026
Frequently Asked Questions
Which state gets the most real value from a raise?
In our $75,000-salary, 5%-raise scenario, South Dakota ranks first — the raise is worth $2,994 in real, cost-of-living-adjusted terms, the highest of any state, driven by zero state income tax and a below-average cost of living.
Which state gets the least value from the same raise?
California ranks last in our analysis — the same $3,750 raise is worth only $2,043 in real terms, due to California's progressive state income tax and its 112.6 Regional Price Parity, 12.6% above the national average.
Do all no-income-tax states rank the same?
No. All eight no-income-tax states in this analysis keep the same 70.3% of the nominal raise before cost-of-living adjustment, but their final rank varies substantially once regional prices are factored in — South Dakota (rank 1) and Washington (rank 39) both have zero state income tax but very different costs of living.
Would the ranking change at a different salary?
The precise dollar figures would change, and the exact order could shift somewhat, because most state tax brackets are progressive. But the broad pattern — no-income-tax and lower-cost states outperforming high-tax, high-cost states — holds across most typical salary ranges.
Frequently asked questions
Founder and developer of We Are Calculator. No lead selling, no lender rankings, no affiliate-pulled recommendations. Every guide pairs primary sources (IRS, CFPB, Federal Reserve, CRA) with the free calculators you can run yourself.
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