The federal deficit hit an all time high of over $28 trillion in March 2021. Unlike the federal government, however, nearly all states are constitutionally required to have a balanced budget and depend on multiple sources of tax revenue to fund operations. No two state tax structures are exactly alike, and in some parts of the country, Americans pay fewer taxes than in others.

One of the primary revenue sources for most states is income tax. Depending on the state, personal income tax can account for over one-third of overall tax revenue — a tax burden shouldered exclusively by workers and investors. There are, however, eight states that do not levy any personal income taxes, and one additional state that only taxes income from interest and dividends. READ MORE