The 10 States Taxing The Poor Most: 24/7 Wall St.

24/7 Wall St.: In an effort to help families work their way out of poverty, most of the United States do not tax the incomes of working-poor families. A handful of states do, however. 24/7 Wall St. examined a new report from the Center on Budget and Policy Priorities to identify the states that tax the poor the most.

Read The States Taxing the Poor Most

The decision of these states to continue taxing the poor is notable because most states have stopped. Over the past two decades, there has been a widespread, bipartisan effort to roll back taxes on working-poor families. Today, only 15 states still tax families with incomes that are at, or below, the federal poverty line — currently $23,018.

However, the effort to reduce taxes on the poor has stalled, according to the CBPP. In 2011, no new states exempted working-poor families of four — the benchmark family unit used in the study — from income taxes. Worst still, in almost all 15 states, these taxes have increased.

The number of states that continue to tax poor, working families remains too high, Phil Oliff, policy analyst at the CBPP and coauthor of the report told 24/7 Wall St. “That makes it harder for those families to pay for basic necessities like food and clothing; it makes it more difficult for them to afford work related expenses like child care and transportation costs; and it’s bad for the state’s economy.”

While the average median income of the residents of these states varies, a number are particularly poor relative to the rest of the country. States such as West Virginia, Georgia and Alabama have among the highest poverty rates in the country. As a result, a larger percentage of these states’ populations are affected by taxes on poor families. According to Oliff, “States should be helping poor families to work their way into the middle class, not taxing them deeper into poverty.”

24/7 Wall St. identified 10 states that tax two-parent families of four living at the poverty line at the highest rate, based on CBPP’s report, “The Impact of State Income Taxes on Low-Income Families in 2011.” All of these states also tax families with incomes that place them below the poverty line. For each state, we also included the income level below the poverty line where families would not be taxed. In addition to this, we included the poverty rate and median household income for each state, based on data from the U.S. Census Bureau.

These 10 states tax the poor the most, according to 24/7 Wall St.:

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Comments

[tomteboda]

01:38 AM on 05/20/2012

Very misleading statistics. For example, they cite the lowest taxable income, then relate it to the poverty line, BUT the lowest taxable income is for a single person, while the poverty line its related to is for a household of 3.

[Araminta Ross]

07:42 PM on 04/18/2012

Blue states and red states. We need more green states.

[Carmen Madonna Campos]

10:32 PM on 04/16/2012

yes, by all means, justify taxing homeless and children and people who don't have two nickels to rub together. because, after all, this is for the benefit of those with accounts in the Cayman Islands......

[bridge to somewhere]

05:02 PM on 04/16/2012

The Oregon stats are misleading...because the state has no SALES TAX. State revenue must come from either income tax or property tax, both of which are higher to compensate for the lack of sales tax revenue.

How much would working poor pay in sales tax over a year in any of the other listed states...I wonder...

[ScottTDavenport]

06:00 PM on 04/16/2012

great post, I agree completely. the Sales tax is an unfair regressive tax, therefore, states that remove it and shift the extra revenue to income taxes build a more progressive and simple system.
In this most recent economic crisis, states have had to either raise taxes or cut funding to make up for lost revenue. The lack of political support for legislatures in raising income taxes have led to "backdoor" passing of sales tax hikes in some states. The problem with this is that the increased sales taxes put a heavy burden on the poor and middle class and virtually no burden on the rich. Whether you agree with that plan or not is irrelevant. What is relevant is that it would have been more equitable to have increased the income tax to begin with instead of raising the sales tax.

[Birdman 49]

02:02 PM on 04/16/2012

i WAS RECENTLY BASHED BY A POSTER: My response is as follows. No I got a refund. I am one of the working poor. I did pay the state. I only get a refund because of how much I have the feds take out of my check every payday, this allows me to get the refund other wise I would have to pay yearly. The poster that bashed me has got some issues, he is bashing a lot of people on this blog. WOW. MEAN as H*ll.

I still think the rich is NOT paying their fair share. When many big companies end the year paying NOTHING in taxes, there is a problem.

I also conceded there are many that don't pay taxes yearly, it's the tax code that is messed up and many of us know it. Bashing me won't get it fixed and giving more tax breaks to the rich is sure NOT going to fix the problem. I will be glad when the Bush tax breaks are gone.

[JustinP213]

11:11 AM on 04/16/2012

Everyone should pay at least something in taxes.

[bridge to somewhere]

05:03 PM on 04/16/2012

Even if they're homeless. We can round them up into work-crews so they can pay their debt to the society that threw them away.

[MDhome]

10:32 PM on 04/16/2012

Damn straight, send off to the blood donor clinic.

[tomteboda]

01:40 AM on 05/20/2012

Honestly, everyone who participates in commerce pays taxes to some extent... there's no avoiding sales taxes unless you only barter or engage in black market trade.

[Jack Lantern]

09:47 AM on 04/16/2012

Although it shouldn't surprise anyone here, most of the states mentioned are "Red" (Republican) or "Red" leaning.

Ronald Reagan is rolling over in his grave!

[Bklein153]

09:15 AM on 04/16/2012

Whys shouldn't everyone pay something! Don't Democrats constantly rave about why government is so important and the importance of the 'public space?' Shouldn't everyone pay something for these amenities of society? Having everyone contribute is only fair. Considering that most of the poor are poor because of their decisions in life - and don't say the poor did not create their circumstance because failing to finish high school and having a child out of wedlock are the primary drivers of poverty - shouldn't they also contribute something??

[makeck]

10:48 AM on 04/16/2012

I recall Bill Gates Dad talking about taxing the rich more, and he stated "Taxes are the rent you pay for living here". When he spoke he was talking about the rich, but I think it applies equally to the poor (sorry). But having said that, its not that I think the poor MUST pay taxes, what I truly despise are refundable tax credits. Take the Family in Alabama they describe, having to pay $500 in State Income Taxes. That family would have received someething like $3000 on their Fedral return by Earned Income Tax Credits and Child Tax Credits. So they are STILL $2500 to the good after paying the State of Alabama.

[Bklein153]

11:49 AM on 04/16/2012

I couldn't agree more

[makeck]

10:55 AM on 04/16/2012

Correction, they would have received a check from the Federal Government for a little over $7000. $1000 each for the kids, and a family of four makiing $12,600 gets an Earned income Tax Credit of 40%, or a little over $5000.

So they are still $6500 to the good. Hard to get upset about that.

[DCX2]

11:17 AM on 04/16/2012

Yes. It's so hard to be upset when you have to support four mouths with less than $20k income. That's $384 a week. Actually, it's $242 a week until your income tax return is filed.

[Billybladerunner]

08:49 AM on 04/16/2012

Okay . despite what any of you are thinking , Republicans are for lower taxes and Democrats are for raising taxes to pay for programs to give entitlements which just keeps people poor...

How's that working out for you

the majority of these states have Democrat leaders right now , the ones with republicans in office are brand new like Kasik in Ohio

[GoodbyeRubyTuesday]

02:35 PM on 04/16/2012

I don't think that you can speak for what Democrats are 'for'...........because you obviously don't know and don't care.

[bridge to somewhere]

05:04 PM on 04/16/2012

Oregon has no sales tax, so of course income taxes are higher. There's one blue state you can cross off your silly little list...

[RTIII]

07:56 AM on 04/16/2012

Hmnmm......

Seems to me that most of these are RED states, and one has to wonder where the anti-tax attitude is.

OH, that's right; The RIGHT keeps state-level taxes on the poor high so there's all that anger toward taxes that they then redirect to try and lower taxes on the rich at the federal level... Interesting manipulation plan. It seems to be working.

[Bklein153]

09:22 AM on 04/16/2012

Actually this article is extremely misleading. Yes these states have income taxes on all income brackets,but they also have relatively lower sales tax or exempt products like food and clothing. Since the poor spend an larger portion of their income on basic necessities, blue states like California, New York and Illinois actually are less progressive than their red counterparts. Hell, Illinois taxes all residents a minimum of 6.25 on all items (including food and clothing). This burden falls disproportionately on the poor. Article is nothing more than a skewed propaganda piece. Himmler would be proud of this Huffington Post masterpiece!

[RodbfromNC]

06:22 AM on 04/16/2012

Alabama...The state with more rednecks and less culture than a room full of north Carolina rednecks. The Rednecks from NC have several teeth where as Alabama only has 7 for the state in total. Plus, in NC they speak English. No one quite knows what they speak in Alabama..Maybe Football?

[maninal2]

08:00 AM on 04/16/2012

As an example, the other night's evening news spent 1.5 minutes on a story about thousands of teachers assembling at the state capitol to protest massive education cuts and the introduction of for profit charter schools just before they spent 12 minutes on the spring football demonstrations games.

[GeorgieGirl9]

08:49 AM on 04/16/2012

Must be great to be a liberal.

[RodbfromNC]

06:12 AM on 04/16/2012

Tax the poor, because the rich should never have to pay for roads, schools, police, fire, government agencies that keep them rich...et al. Remember, that are the "job Creators"...in China, but they do create jobs.

[Peace Frog]

01:13 PM on 04/16/2012

The rich pay for almost all of it nowadays. 80% of federal income tax is paid by the top 20%.

[bridge to somewhere]

05:05 PM on 04/16/2012

Should be closer to 95%...and it would be under the Reagan tax policies.

[pinkibus]

05:46 AM on 04/16/2012

The thing you have to remember is that you have to tax the poor. If you don't tax the poor then you will have to tax the rich but that just isn't right. I mean if you tax the rich then you won't have the benefits of the trickle down effect. I mean you won't have the benefits of the trickle out effect. And the poor obviously must pay because they wouldn't be poor if they weren't so a) stupid b0lazy c) deserving of nothing.

[RodbfromNC]

06:14 AM on 04/16/2012

Lazy like you, who gets government assistance. You would not be posting here is you were part of the 15. You just envy them....but they will not let you in.......

[maninal2]

08:00 AM on 04/16/2012

Mumble mumble mumble... your talking points are getting so old

[thegriffinite]

03:30 AM on 04/16/2012

If you budget your money you can live of little to nothing in most places like this i have seen houses sell in my town for $5,000 an on a 30 year mortgage it was like 50 dollars a month. Plus the cost of living is way cheaper in the south that's why we have all these carpet baggers.

[maninal2]

08:01 AM on 04/16/2012

You must be talking about your Chinese province.

[catmagnet]

10:46 AM on 04/16/2012

No, I found that my living expenses are basically half of my income (rent, utilities, groceries, gas, insurance). They were substantially higher when I lived north of the Mason-Dixon Line, especially when I lived in the Blue State haven of the Northeast.

[CITYTERRACE63]

02:23 AM on 04/16/2012

The poor need to pay. They use most of the government services like food stamps Medicaid and welfare and those programs cost money and I should not have to pay for them because I have my own health insurance which I pay for. I have a great idea. Make the poor pay a minimum tax. Right now 50% of Americans pay no income tax and that is wrong. Do to the working poor like what California does to small businesses. In California businesses have to pay an $800 minimum tax whether they make money or not. The government could do that on a national scale. Everyone in the United States over the age of 18 should have to pay a minimum tax if they are employed or make money. Set it at about $250 no exceptions. Eliminate the EIC child tax credit and set it up so nobody can take out more than what they paid in.

[kathy smelser]

07:30 AM on 04/16/2012

then why dont the rich who use C Welfare get taxed ?....if the poor are taxed for receiving free bees then it would be fair to tax the rich that receive free bees

[Bklein153]

09:32 AM on 04/16/2012

Trust me the wealthy do pay alot of taxes. I paid 26.4% on Federal income tax, 3.1% on state taxes, 1.5% on local taxes. I also paid a rel estate tax for the privileged living in my community, a sales tax to both the local and county, a vehicle tax, multiple business taxes (you know to provide jobs for other residents of the state) and medicare and Social Security taxes which I will never pull out what I put in. Altogether, I pay just under 50% of my income in taxes. Now, I do not mind paying my fair share, but when half of my income is taken so a bunch of degenerate scums can destroy the free housing I fund, have illegitimate kids who need schooling and food and cloths and healthcare - that their irresponsible and repulsive parents can not afford, and are responsible for the majority of the crime in this nation - yes I feel they should pay something.

You ask for the wealthy to pay their fair share - mostly as a expression of loyalty to this country that has benefited them so much - yet you ask nothing - yes nothing of the bottom rung of society that does little more than act as parasites on society.

[bridge to somewhere]

05:07 PM on 04/16/2012

Yes, the best thing we can do for the economy is to squeeze money out of people who don't have any so the people who have hoards of it don't need to go without their bubbly for one evening. That's the American way.