10 States With the Worst Property tax and 3 With Low Property Tax

Rebecca Holcomb

Updated:

Woman looking at tax
Image Credit: Shutterstock.

It doesn't matter much how you phrase it: no one likes taxes. However, living in the US means that if you own a home or property, you will owe taxes on that property. How much tax you owe depends on the appraisal of your home value. If you own a mansion that's been sitting for decades unattended next to a landfill, it might owe less tax than the lovely, two-room single-family home on 30 acres across town. 

Because your home value depends on where you live and the location of your home, taxes can vary greatly. Generally speaking, the more house and property you have, the more tax you'll pay. However, there is one instance when you may be able to have your taxes reduced or even owe zero tax. 

If you are 100% disabled, many states have laws that allow you to be exempt from paying property taxes. But the average person is still going to owe something on their property. Some states are downright nasty to their property owners, charging a hefty fee for owning parcels of land. You'll easily recognize if you live in one of the worst states for taxes on land. And for fun, we threw in some states that shine in this area

States That Will Suck You Dry on Taxes

1. New Jersey

Credit: Depositphotos

If you're thinking of moving to New Jersey, you'll want to stock up on cash for your property taxes. The median tax on property in the Garden State is 2.33% and equates to $9,345 on the median home value of $401,400.  

New Jersey boasts the highest tax rate on property and the ninth-highest home value. Taxes in the state are also high on sales at 7%, and its graduated income tax rate grows from 1.4% to nearly 10.75%. 

2. Illinois

Chicago
credit: depositphotos

Illinois isn't fairing much better as their property tax rate hits 2.11%. On a median home value of $239,100, the median taxes come out to $5,055. With a median income of just $78,433, residents in the Prairie State should consider budgeting their property tax payments into their monthly costs to ensure they can cover the entire annual payment.

With a higher sales tax at 6.25% and a state income tax of 4.95%, the only margin helping out residents here is the relatively low median home value. 

3. Connecticut

Greenwich Connecticut
credit: Shutterstock

Connecticut takes its place in the running with a tax rate of 2%, which still creates a median yearly tax bill of $6,484. The median home price settles in at $323,700, which trends higher than their neighbor, New Hampshire.  

With an average yearly income of $90,213, natives in the Constitution State will see higher taxes, especially because Connecticut has the 11th highest sales tax at 6.35%. 

4. New Hampshire

Portsmouth, New Hampshire

Sliding just under the 2% rate is the Granite State. Their annual property tax rate is 1.89%, which, on a median home value of $337,100, generates a tax bill of $6,372. With an average income of $90,845, most people local to New Hampshire will want to spend a bit of time budgeting their tax payments to keep their property up to date. 

Thankfully, residents here don't have to worry about a sales tax as New Hampshire is one of just five states that don't have a general sales tax. New Hampshire also does not collect an income tax, so living in this New England state is another bonus. 

5. Vermont

Stowe, Vermont
credit: depositphotos

Welcome to the Green Mountain State, where your annual property tax will be between 1.56% and 1.78%. On a median home value of $272,400, your tax bill is going to run $4,859. In New England, that's not so bad. However, the average yearly income is just $74,014, so residents will need to factor that payment into their annual budget. 

Vermont also features a 6% sales tax and a gradual state income tax that ranges from 3.35% to 8.75%, which adds up to a tax bill that increases to $7,527.

6. New York

Whitney Museum of American Art, New York
Image Credit: Shutterstock.

With an effective tax rate of 1.64%, the Empire State will send you an average bill of $6,303 on a median home value of $384,100. The average pay in New York is around $81,386, which means you may have to save up if your monthly budget doesn't normally account for your property tax payment. 

New York state levies a 4% sales tax on all of its residents. If you live in New York City, you're going to add another 4.5% sales tax from the City of New York and a .375% Metropolitan Commuter Transportation District surcharge. New York also has nine income tax brackets ranging from 4% to 10.9% based on annual earnings. Locals in New York and Yonkers will also pay a local income tax

7. Texas

Skyline of Houston, Texas
Image Credit: Shutterstock.

The Lone Star State has an effective property tax of 1.63% and a median home value of $238,000. This means the average property tax payment totals $3,872 a year. The middle-ground income is $73,458. But with a higher cost of living in the state, it's a good idea to plan for this payment ahead of its regular due date to ensure you don't risk losing your property. 

Texas does have a 6.25% sales tax on goods and services, but it doesn't collect an individual income tax and doesn't tax estates within its borders. 

8. Wisconsin 

Madison, WI
Credit: Depositphotos

Taxes range from a graduated income tax of up to 7.65% to an effective tax rate of 1.59% on properties in the Badger State. With a median home value of $231,400 and an average property tax payment of $3,670, most people will have to take their property taxes into consideration when balancing their yearly spending budget. 

The average income in Wisconsin is $72,458, and the state charges a 5.00% sales tax on all goods and services. Taking into account the tax information, Wisconsin doesn't make any friends with its tax policies. 

9. Nebraska

Lincoln, Nebraska
Image Credit: Shutterstock.

The Cornhusker State levies a property tax rate of 1.54% to collect an average tax of $3,167. With a median home value of $205,600 and an annual average income of $71,722, residents may want to seriously consider adjusting their yearly budgets to make room for their property tax payments. 

Cornhuskers might pay an additional use tax on top of the state's regular 5.5% sales tax. The state also imposes a graduated corporate income tax that ranges from 5.58% to 5.84%. 

10. Iowa

credit: Shutterstock

Welcome to the Hawkeye State, where you'll pay an effective tax rate on your property of 1.49%. The average home value sits at $181,600, and most people spend around $2,703 in taxes for their homes and land. The median income in Iowa is $70,571 annually, which means that most people will need to consciously plan for their yearly tax payments. 

The sales tax in Iowa is 6%, with local communities adding their own local taxes to that bill. Income taxes shift from 4.82% to 5.7%, depending on annual income. However, in 2025, that rate will drop to 3.82% due to legislation that passed in May 2024. 

States With Great Tax Rates

No one likes paying taxes, but if you live in a few low-tax states, you're a whole lot happier than homeowners in the rest of the US. If you want to look at property tax differences, these states have meager property tax rates.  

1. Hawaii

Waikiki Beach and Diamond Head, Honolulu, Oahu Island, Hawaii
Image Credit: Shutterstock.

The Aloha State comes in first with an almost non-existent property tax rate of 0.27%. However, the downside is that their median home value is much higher than other states at $764,800. If you can afford a property in this tropical paradise, you'll see an average tax payment of just $2,054 and likely make around the average income of $94,814. 

Despite Hawaii being an expensive tourist trap, its sales tax is a relatively low 4%. Income taxes have a wide range from a minimal 1.4% to a hefty 11% based on your yearly income bracket. 

2. Alabama

Mobile, Alabama
credit: depositphotos

Property taxes in the Yellowhammer State are higher than Hawaii at 0.39%, but they have arguably one of the lowest median tax payments at just $701. Even with an average annual income of only $59,609, property taxes are relatively easy to deal with. 

Alabama also keeps its sales and income taxes low. Sales taxes in the Gulf Coast state run at 4%, and income taxes run between 2% and 5%. 

3. Colorado

Telluride Ski Resort, Mountain Village, Colorado - March 25, 2019: Visitors enjoy end of ski season
Image Credit: Shutterstock.

Colorado boasts the third lowest property tax rate at just 0.49%. However, its higher median home values at $465,900 make its average tax payment larger at $2,278. Median incomes in the state are considerably higher than in Alabama, hitting $87,598 and making it easier for residents to pay their land and home taxes. 

Thankfully, the Centennial State keeps its income taxes low at just 4.63%, and locals also benefit from the lowest sales tax in the country at 2.9%. Only seven states beat out Colorado because they offer zero state sales tax. 

Leave a Comment

Flipboard