People In This 1 State Get the Most Out of Their Tax Dollars

Paying taxes is a necessary evil in the United States. On a daily basis, we have to pay sales tax. Each year, we have to pay up and give Uncle Sam our income taxes. Sometimes we have to pay estate taxes when we die. Well, actually, our next of kin pay that one, but you get the idea. We’re heavily taxed, and only the lucky residents of a few states get big tax refunds. In some states, however, you actually get back what you put in, or much more. Residents of 1 U.S. state pay far less in taxes than they get back from the government, and there are actually a lot of states where taxpayers get the most for their money.

RewardExpert looked at the data and discovered the average tax per person, the amount each state spends per capita, and the return value. Let’s take a look at the rankings, based on return value rates.

The 5 worst states

Before we show you the states where taxpayers get the most bang for your buck, let’s tour the states at the back of the pack.

5. New Hampshire

New Hampshire State House

New Hampshire residents don’t get much value for their tax dollars. | Scott Eisen/Getty Images

  • Tax paid per capita: $4,725
  • Government spending per capita: $5,470
  • Per capita return on investment: 1.06%

It shouldn’t be surprising to see New Hampshire on the worst list. After all, the state doesn’t have a personal income tax, corporate income tax, or a state sales tax, and it taxes interest and dividends at a top rate of 5%. Still, the state spends more money than the average person pays in taxes.

Next: New Hampshire’s distant cousin?

4. Nevada

view of las vegas

Nevada residents don’t pay income tax, but they don’t get much for the taxes they do pay. | Photo by Ethan Miller/Getty Images for Ascaya

  • Tax paid per capita: $5,059
  • Government spending per capita: $5,260
  • Per capita return on investment: 0.38%

Like New Hampshire, Nevada doesn’t have a personal income tax. Nevada is 11th-lowest in the country when it comes to the amount the government spends per capita, but the return value per dollar is fourth-worst at a paltry 0.38%.

Next: People in this state pay a ton in taxes, but they don’t get much back.

3. Connecticut

Hartford, Connecticut skyline

Connecticut has one of the highest tax bills and one of the lowest tax values in the U.S. | SeanPavonePhoto/ Getty Images Plus

  • Tax paid per capita: $7,732
  • Government spending per capita: $7,861
  • Per capita return on investment: 0.20%

Thanks in part to a 6.99% top state income tax bracket, Connecticut residents have one of the highest tax bills in the country at $7,732 per person. And what do they have to show for it? Not much, since the return value for each tax dollar is just 0.20%.

Next: A low income tax rate doesn’t help residents in this state.

2. North Dakota

Fargo, North Dakota, United States

The value per tax dollar in North Dakota is barely more than 0%. | Ben Harding/iStock/Getty Images

  • Tax paid per capita: $9,465
  • Government spending per capita: $9,532
  • Per capita return on investment: 0.11%

The top state income tax rate of 2.9% is on the lower end nationally, but North Dakota residents shell out in other ways and have one of the highest per capita tax bills in the U.S. Governments here barely spend more per person than they collect in taxes, but as we are about to see, things could be worse.

Next: The only state shortchanging residents.

1. Hawaii

Rainbow Falls in Hawaii

Hawaii looks nice, but the state spends less per resident than it takes in taxes. | Png-Studio/Getty Images

  • Tax paid per capita: $6,942
  • Government spending per capita: $6,826
  • Per capita return on investment: -0.16%

The $6,942 per capita tax bill for Hawaiians is one of the highest in the country, and they don’t get back what they put in. The government actually spends less per capita than it takes in, and it’s the only state in the U.S. with that dubious distinction.

Next: The 10 states where your tax dollars go a long way.

The 10 best states

We’ve seen the worst states where taxpayers don’t get back what they put in. Now let’s see where your tax dollars really stretch the furthest.

10. Vermont

Stowe, Vermont

The return value for each tax dollar is very high in Vermont. | DonLand/iStock/Getty Images

  • Tax paid per capita: $6,721
  • Government spending per capita: $8,753
  • Per capita return on investment: 3.88%

Vermonters pay a relatively large amount in taxes, but they get back what they put in. The government spends more than $2,000 more per person than what he or she pays in taxes in the form of education, roads, public health, and other benefits. Look at it this way: For every tax dollar, the state spends $1.0388. Vermont is one of the top states where taxpayers get the most for their money, but as we will soon find out a handful of states do even better.

Next: Cheap legal marijuana is just one reason to love this next state.

9. Oregon

Portland, Oregon

The government in Oregon spends a lot on its parks. | Png-Studio/iStock/Getty Images

  • Tax paid per capita: $4,823
  • Government spending per capita: $6,758
  • Per capita return on investment: 3.89%

Oregon has three cities selling the cheapest legal pot in the country, but that’s just one reason to love it there. State governments spend close to 4% more than what they take in taxes and put it toward parks and public safety measures, among other things.

Next: Is this the best state for your money?

8. Mississippi

Welcome to Mississippi

Welcome to Mississippi, one of the best states for your money. | Meinzahn/iStock/Getty Images

  • Tax paid per capita: $4,065
  • Government spending per capita: $5,607
  • Per capita return on investment: 4.24%

Is Mississippi the best state for your money? It’s not hard to argue that point, and its status as one of the states where taxpayers get the most for their money is just one reason why. The per capita tax burden is one of the lowest in the U.S., and the government spends 4.24% more than it takes in from all taxes. Not only that, but it’s the least expensive state to live in, as its cost of living is about 14% less than the national average.

Next: Ignore one tax fact and look at the overall pluses.

7. Arkansas

Little Rock, AR, USA

Arkansas gives you a lot of bang for your tax bucks. | csfotoimages/iStock/Getty Images

  • Tax paid per capita: $4,313
  • Government spending per capita: $5,958
  • Per capita return on investment: 4.54%

Based solely on the 6.9% top bracket, Arkansas is one of the worst places for state income taxes. Yet it is definitely one of the states where taxpayers get the most for their money. The state is in the middle of the pack for taxes as a percentage of total revenue, but it doesn’t hesitate shelling out more than it takes in. RewardExpert notes Arkansas is higher than average in public welfare spending.

Next: Residents should thank big businesses.

6. Delaware

Wilmington Delaware skyline along the Riverfront at night

Corporate taxes help Delaware residents get great value on their tax dollars.| pabradyphoto/iStock/Getty Images

  • Tax paid per capita: $4,898
  • Government spending per capita: $7,355
  • Per capita return on investment: 4.68%

In Delaware, the government spends nearly $2,500 more per person than it collects in taxes, and residents have big business to thank. Since the state has so many corporations paying taxes, it spends much more per capita than it takes in. Plus, Delaware doesn’t have a state sales tax and has low property taxes, so residents enjoy some of the lowest taxes in a state where taxpayers get the most for their money.

Next: Where you pay a lot, but you also get a lot.

5. New York

Statue of Liberty and New York

Big tax bills but big benefits in New York. | MDBrockmann/iStock/Getty Images

  • Tax paid per capita: $8,791
  • Government spending per capita: $11,046
  • Per capita return on investment: 4.72%

At nearly $8,800 per person, New York residents pay some of the highest taxes in the land. But they also get a lot back for what they put in. Corporate tax income lets the government spend more than $11,000 per person. Government spending exceeds per capita tax revenues by 4.72%, putting New York in the top 5 of states where taxpayers get the most for their money.

Next: A nickel for your thoughts — and your tax dollar.

4. Kentucky

Kentucky residents have to be extra prepared for travel.

They have some of the lowest income taxes in the country. | iStock/Getty Images

  • Tax paid per capita: $4,255
  • Government spending per capita: $6,334
  • Per capita return on investment: 5.05%

Kentucky gets most of its tax revenue from income tax, and the property taxes are some of the lowest in the country. Residents get about a 5% return value for each tax dollar they spend. So, for every $1 a resident puts in returns roughly $1.05.

Next: A state spending more than $3,000 more than per capita tax amount.

3. Wyoming

If you live in Wyoming, your tax dollars really benefit you. | Photo by Spencer Platt/Getty Images

  • Tax paid per capita: $6,829
  • Government spending per capita: $9,987
  • Per capita return on investment: 5.24%

Just 35.84% of Wyoming’s revenue comes from taxes, which is No. 48 in the country (we’ll meet Nos. 49 and 50 in a minute). Even though it doesn’t have personal or corporate income taxes, Wyoming collects enough in sales and property taxes to spend much more per person than it collects.

Next: We wish our savings account was anywhere close to this much return on investment.

2. New Mexico

New Mexico spends a lot more on residents than it direct collects in taxes. | Qingwa/Getty Images

  • Tax paid per capita: $4,337
  • Government spending per capita: $7,722
  • Per capita return on investment: 7.46%

New Mexico is No. 2 when it comes to states where taxpayers get the most for their money. The state spends $3,395 more per resident than it receives on a per capita basis. It amounts to a return on investment equal to 7.46%. We wish our savings account got that much, but even New Mexico’s huge return is way off the pace set by No. 1 on the list.

Next: The state giving residents the most for their money.

1. Alaska

trans-alaska pipeline

Welcome to Alaska, where the state spends more than $12,000 per person. | Photo by Barry Williams/Getty Images

  • Tax paid per capita: $3,430
  • Government spending per capita: $12,511
  • Per capita return on investment: 12.38%

Alaska is extremely dangerous for a number of reasons, but it tops the list of states where taxpayers get the most for their money. The state spends nearly four times per person than it takes in from taxes. When all is said and done, expenditures surpass per capita tax revenues by an amount equal to 12.38% of the average Alaskan’s income.

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