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State Tax Refund


State Tax Refund

A state tax refund is issued when a resident submits their state taxes and is found to have overpaid, in which case the state government will reimburse the resident that amount.

About State Tax Refund

State income tax refunds are based on the income tax that is levied by each individual state. There are seven states that have no income tax - Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. The highest rate of state income tax is in Hawaii, with a maximum rate of 11%. The lowest rate is that of Illinois, which levies a flat tax of 3%. Most states have a progressive income tax, where the rates rise as the income grows higher.

Some state and local taxes (including state income taxes) are deductible for federal tax purposes. The federal government will subsidize a portion of an individual's state income tax, but only for taxpayers whose total deductions are greater than the standard deduction, which means the subsidy falls almost entirely to middle class payers.

As with federal tax returns, individual state returns must also be filed by April 15th. These can be done by mail or electronically.

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