US States offering the most generous tax rebates and benefits in 2024

As the tax season kicks off, we have researched and compiled a list of states that offer the most generous tax credits, rebates, and other benefits to their residents. If you are a resident of one of these states, it is essential to take advantage of these benefits.

Alabama

While no rebates have been announced this year, the state did begin sending out a rebate in early December worth $150 to those who filed a 2021 state Individual Income Tax return by 17 October 2023.

Alaska

Residents of Alaska can apply for funding through the 2024 Permanent Fund Dividends program. The application process begins on 1st January and closes on 31st March each year. The application is now live and residents are encouraged to submit their claim as soon as possible.

Last year, the dividend payment was valued at $1,312. While the exact amount for this year’s payment has not yet been determined, it will be announced in the coming months once a decision has been made. The funds for these payments are generated through profits from the petroleum sector, and this program aims to distribute the benefits of production to the state’s residents.

Arizona

This year, Arizona is offering residents the Arizona Families Tax Rebate. To receive the rebate, the taxpayer must:

This tool, developed by the state’s tax authority, can be used to update your rebate address, make your claim, or check the status of your rebate. Those who meet the eligibility requirements will receive $250 for each dependent under 17 claimed on their tax return and/or $100 for those older than 17. All in all, no more than three dependents can be claimed, capping the value of the credit at $750.

Arkansas

In September, the Arkansas legislature passed a series of laws that are expected to lower the tax bills of most of the state’s residents this year. The top tax rate for individuals was lowered by 0.3 percent to 4.4 percent. Additionally, a one-time credit worth $150 will be made available to all taxpayers with an income of $89,600 or less in 2023. A less valuable credit will be made available to all those with incomes under $103,600.

California

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Colorado

In November 2023, the state’s legislature changed the Taxpayer’s Bill of Rights (TABOR) Amendment, which will allow some residents to claim a sales tax refund. The credit will be claimed when filing a state tax return (2023 DR 0104). There are three eligibility requirements. The first is that the taxpayer has to have been at least eighteen years for all of 2023. The second is that they cannot have a Colorado income tax liability or be claiming a refund of wage withholding. Those able to claim the refund should expect to receive $800 ($1,600 if filing jointly). However, the amount will vary by income group with higher earners seeing a lower refund and those with lower incomes receiving a more significant share.

Do you need to pay federal tax on your TABOR refund?

No, these refunds are not counted as income by the Internal Revenue Service.

Connecticut

Like Arkansas, residents of Connecticut will also see decreases in the tax rates applied to their incomes by the state’s revenue authority.

The first $10,000 earned by a single filer (or the first $20,000 for married couples filing jointly) will be taxed at 2 percent instead of 3. Additionally the state decreased from 5 to 4.5 percent the tax “on the next $40,000 earned by single filers and the next $80,000 by joint filers.” The state estimates that one million of the state’s 3.6 million residents will be affected by the reductions. Officials have also made clear that they are focusing on reducing the tax burden of the middle class and capping the filers able to take advantage of the reductions for single filers making over $150,000 (or $300,000 for those filing jointly).

Delaware

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Florida

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Georgia

While no additional benefits are being offered to taxpayers this year, a 2022 law that took effect on 1 January 2024 eliminated the progressive tax structure of the state with a flat tax of 5.49 percent. The legislation decreases the rate at a consistent rate until it reaches 4.99 on 1 January 2029.

Hawaii

In Hawaii, lawmakers voted to double the value of the Earned Income Tax Credit and the Food Exercise Tax Credit. These credits are offered to the state’s “most economically vulnerable residents.”

Idaho

The state will continue to offer some residents reductions in their property tax bill this year. The program aims to help seniors, veterans, orphans, and disabled people and caps the annual income of beneficiaries at $37,000 a year.

Illinois

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Indiana

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Iowa

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Kentucky

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Louisiana

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Maine

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Maryland

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Massachusetts

Taxpayers in Massachusetts will see that “the tax rate on short-term gains from the sale or exchange of capital assets [has] decreased from 12% to 8.5%.” This decrease went into effect on 1 January 2023.

Seniors 65 and older who own or rent a home in the state can claim the Circuit Breaker Tax Credit equal in value “to the amount by which their total real estate tax payments, or 25% of their rent in the case of a renter, exceeds 10% of the taxpayer’s total income up to a certain amount.” This is the first year taxpayers eligible to claim the credit will benefit from the statuary base amount being doubled, leading the maximum value of the credit to rise to $2,590.

More generally, renters will benefit from a deduction that “is equal to half of the rent paid for a principal residence located in Massachusetts.” For 2023, the deduction increased in value from $3,000 to $4,000 for single filers and from $1,500 to $2,000 for married couples filing jointly.

The legislature also approved a change to the tax code that increases the Commuter Deduction to cover fairs paid on or for:

The state is offering a refundable Child and Family Tax credit to taxpayers who have children or other dependents. To be eligible, the children must be under the age of 13 or a dependent (including one’s spouse) who has a disability that makes them unable to care for themselves. This year, the credit is worth $310 for each dependent claimed, and there is no limit to the number of dependents that can be claimed on one’s tax return.

The state’s Earned Income Tax Credit will increase in value from thirty to forty percent of the federal credit (should they be eligible to claim that benefit).

More information on these changes and others can be found on the state tax authority’s website.

Michigan

In Michigan, the value of the Earned Income Tax Credit for Working Families will increase from six to thirty percent of the federal credit.

To support those eligible to claim the credit, the state’s revenue authority will be distributing a supplemental check worth 24 percent of one’s federal 2022 EITC.

Minnesota

The state is introducing a credit worth $1,750 for parents and guardians who have children. There is no limit on the number of children that can be claimed. However, the full credit value applies only to taxpayers with an income below $29,500. For couples filing jointly, the income threshold is $35,000. After this threshold, the value of the credit begins to decrease.

Mississippi

In Mississippi, taxpayers will notice that this year’s filing is a little different. The state is one that is transitioning to a flat tax rate system and away from a progressive scheme. Now, for filers with an annual income over $10,000, a five percent tax will be levied.

More information is available on the state tax authority’s website.

Missouri

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Montana

Looking ahead slightly, the Property Tax Rebate, available to homeworkers, will reopen for claiming on 15 August 2024. Those hoping to claim the rebate will have until 1 October 2024, which will be worth up to $675. Eligibility information can be found on the state tax authority’s website.

Nebraska

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Nevada

No new rebates, refunds, or credits have been approved for the 2024 tax season.

New Hampshire

Last year, the state lowered income taxes levied against interest and dividends from five to four percent. Further one percent decreases will be implemented each year through 2027.

New Jersey

No new rebates, refunds, or credits have been approved for the 2024 tax season.

New Mexico

No new rebates, refunds, or credits have been approved for the 2024 tax season.

New York

New York is another state that has reduced tax rates for some income groups:

These decreases should help to lower the tax bill for those who fall within these income thresholds.

North Carolina

North Carolina has a flat tax rate system, and in 2023, tax on income fell from 4.99 to 4.75, which will lower the tax bill for many residents.

North Dakota

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Ohio

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Oklahoma

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Oregon

In 2023, the Oregon Kids Credit is refundable and available to those with an annual gross income of $25,000 or under. Up to five dependent children between zero and five can be claimed, with $1,000 being paid per child claimed. At $30,000 a year, the credit is fully phased out.

Pennsylvania

Some homeowners and renters will be eligible to claim Pennsylvania Property Tax Rebate. The application has been opened, and those eligible will have until 30 June 2024 to make their claim. Eligibility varies by age, with those sixty-five and older, a widow or widower over fifty, or any disabled adult who can make a claim. One must own or rent a primary residence in the state and have an annual income below $45,000. The value of the credit depends on one’s income, with those falling in the lowest income tiers ($0 - $8000) seeing $1,000 returned and the minimum payment being $380. More information is available on the state revenue authority’s website.

Rhode Island

The only change to tax law in Rhode Island that went into effect in 2023 is that military service pension benefits can not be subtracted when calculating one’s income for their state-level return.

South Carolina

No new rebates, refunds, or credits have been approved for the 2024 tax season.

South Dakota

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Tennessee

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Texas

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Utah

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Vermont

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Virginia

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Washington

No new rebates, refunds, or credits have been approved for the 2024 tax season.

West Virginia

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Wisconsin

No new rebates, refunds, or credits have been approved for the 2024 tax season.

Wyoming

No new rebates, refunds, or credits have been approved for the 2024 tax season.