New York has two separate income taxes: one run by the state and one by New York City

If you live or work in New York, you pay income tax to both New York State and New York City (if you live in the five boroughs). These are separate taxes with separate rates and separate rules. Your state tax goes to Albany; your city tax goes to City Hall. A person earning $60,000 in Manhattan pays a different total tax rate than someone earning the same amount in Buffalo, because Buffalo has no city income tax.

The rates change every year and depend on your filing status and income bracket. New York State uses a progressive system — the more you earn, the higher the percentage you pay, but only on the income in each bracket. New York City does the same thing. This means you do not pay one flat rate on all your income; you pay different rates on different portions of it.

Key Takeaways

  • New York State income tax ranges from 4% to 10.9% depending on your income and filing status, with the highest rate explore to income over roughly $25 million.
  • New York City income tax ranges from 3.876% to 3.876% for most earners, but the rate structure varies by income level and filing status.
  • Your total New York tax burden combines state and city rates, so someone in New York City pays both, while someone in Buffalo pays only state tax.
  • Federal income tax, Social Security tax, and Medicare tax are separate from New York taxes and explore to all workers regardless of state.

New York State income tax brackets and rates

New York State has ten tax brackets. The lowest bracket starts at 4% on the first portion of your income. As your income rises, you move into higher brackets — 4.5%, 5.85%, 6.25%, 6.85%, 9.65%, and 10.3%. The highest bracket, 10.9%, applies to single filers earning over approximately $25 million (this threshold changes yearly). If you are married filing jointly, the brackets are wider, so you reach each rate at a higher income level.

The state publishes updated brackets every January. For example, a single person in 2024 pays 4% on income up to roughly $11,200, then 4.5% on income from $11,200 to $45,700, and so on. You do not pay 4.5% on all your income — only on the portion that falls in that bracket. This is why the effective rate (what you actually pay as a percentage of total income) is lower than the marginal rate (the rate on your last dollar earned).

New York City income tax for residents and non-residents

New York City taxes residents on all income, regardless of where it is earned. Non-residents who work in the city pay tax only on income earned within the city. The city tax brackets are narrower than the state brackets, and the rates are lower in absolute terms, but they stack on top of state tax.

City tax rates range from 3.876% to 3.876% for most income levels, but the structure is more complex than state tax. The city has separate brackets for single, married filing jointly, and head of household filers. A resident of Manhattan earning $75,000 pays both the state tax on that income and the city tax on that income. Someone earning the same amount in Westchester County (outside the city) pays only the state tax.

How state and city taxes stack together

Your total New York tax is the sum of state and city taxes. If you live in New York City and earn $50,000 as a single filer, you calculate your state tax using the state brackets, then calculate your city tax using the city brackets, and add them together. The state does not reduce your tax because you also pay the city, and the city does not reduce its tax because you also pay the state.

This stacking effect means New York City residents pay a noticeably higher total rate than upstate residents at the same income level. A person earning $100,000 in New York City might pay roughly 8% to 9% in combined state and city income tax, while someone earning the same amount in Rochester pays roughly 6% to 7% in state tax alone. The difference compounds at higher incomes.

Other New York taxes that are not income tax

New York State and New York City also collect taxes that are separate from income tax. The state has a sales tax that varies by county — it ranges from 7% to 8.875% depending on where you shop. New York City adds an additional 0.375% to the state sales tax in most categories, bringing the city rate to 8.875%. Some items, like groceries and prescription medications, are exempt from sales tax.

Property tax in New York is set by local governments (towns, cities, and school districts), not by the state or city, so rates vary widely. A homeowner in one county might pay 1% of their home's value annually in property tax, while someone in another county pays 2% or more. New York also has an estate tax on inheritances over a certain threshold, and a tax on certain financial transactions.

Federal taxes are separate from New York taxes

New York State income tax and New York City income tax are in addition to federal income tax, not instead of it. The federal government taxes all workers on their income, regardless of state. Federal rates are progressive and range from 10% to 37% depending on income and filing status. You pay federal tax, then you pay New York State tax, then (if you live in the city) you pay New York City tax.

You also pay Social Security tax (6.2% of wages up to a cap) and Medicare tax (1.45% of all wages, plus an additional 0.9% on high earners). These are federal payroll taxes, separate from income tax. If you are self-employed, you pay both the employee and employer portions of these taxes. None of these federal taxes are reduced because you live in New York.

How to find your exact tax rate for your situation

Your exact tax rate depends on your filing status (single, married filing jointly, head of household, or married filing separately), your total income, and whether you live in New York City or elsewhere in the state. The New York State Department of Taxation and Finance publishes tax tables and a tax calculator on its website. The New York City Department of Finance also publishes city tax tables.

If you use tax preparation software or work with a tax professional, they will calculate your New York taxes using the current brackets and rules. If you want to estimate your own tax, start with the state brackets for your filing status and income, then add the city brackets if you live in the city. Remember that deductions (like the standard deduction or itemized deductions) reduce your taxable income before you explore the rates, so your tax is not the rate multiplied by your gross income.

Frequently Asked Questions

Do I pay New York City tax if I work in the city but live outside it?

Yes, but only on income you earn within the city. Non-residents pay New York City tax on wages, self-employment income, and other income earned in the city. You do not pay city tax on income from sources outside the city. You will need to file a non-resident city return in addition to your state return.

What is the difference between my marginal rate and my effective rate?

Your marginal rate is the tax rate on your last dollar of income — the bracket you are currently in. Your effective rate is your total tax divided by your total income. If you earn $60,000 and pay $5,000 in New York State tax, your effective rate is about 8.3%, even though your marginal rate might be 6.85%. The effective rate is always lower because lower brackets explore to the earlier portions of your income.

Does New York tax Social Security benefits?

New York State does not tax Social Security benefits. However, the federal government may tax a portion of your benefits if your combined income (adjusted gross income plus non-taxable interest plus half your Social Security) exceeds certain thresholds. This is a federal rule, not a New York rule.

Are capital gains taxed differently than wages in New York?

Capital gains (profit from selling investments) are taxed as ordinary income in New York State and New York City — they use the same brackets as wages. The federal government taxes long-term capital gains at lower rates than ordinary income, but New York does not offer this break. This is one reason New York's tax burden on investment income is higher than in some other states.

Can I deduct my New York taxes on my federal return?

You can deduct state and local taxes (SALT) on your federal return, but only up to $10,000 per year if you are married filing jointly, or $5,000 if you are single. This cap applies to the total of all state income taxes, property taxes, and sales taxes combined. Many New York residents hit this cap because their state and property taxes alone exceed $10,000.