People in These States Get the Biggest Tax Refunds

by Jason Rossi | More Articles: Personal Finance

Published on

April 20, 2018

It’s the time of year that everyone but accountants hates: Tax season. Between the worst states for income taxes, the places with dreadful sales tax, and states with astronomical property taxes, the money always seems to be going out.

But that’s not the case everywhere. Uncle Sam smiles down on a few states where people get the biggest tax refunds. People in these states get more than $2,700 back every year, on average, according to HowMuch.

15. Alabama

Welcome to Alabama road sign on US-84 near Gordon — Welcome to Alabama, home of sizable tax refunds. | iStock.com/miroslav_1

Average refund: $2,787

It’s the question everyone wants to be answered right after filing their taxes: Where’s my federal tax refund? The people of Alabama definitely want to know. They get some of the biggest refunds in America, and they need the money since some live in third world-type poverty.

Next: Hold your horses, refund recipients.

14. Georgia

Atlanta, Georgia, USA downtown skyline at dusk. — The tax refunds in Atlanta and the rest of Georgia are some of the highest in the U.S. | Sean Pavone/iStock/Getty Images

Average refund: $2,793

Before we get too far along, we need to point out one important fact. A huge tax refund, like the nearly $2,800 Georgia residents get, is just the government giving you back the money you already gave it. The folks at SmartAsset remind refund recipients to remember that when the check arrives.

Next: The federal tax refund is merely a silver lining.

13. California

Golden Gate bridge in San Francisco — A big refund is merely a silver lining in heavily-taxed California. | iStock/Getty Images

Average refund: $2,811

The state income taxes and sales taxes in California are among the worst in the U.S. The federal tax refund is just a silver lining. If some Californians get their way and become the 51st state, called New California, then they can kiss their federal tax refunds goodbye.

Next: The federal refund hardly makes up for brutal taxes.

12. Illinois

The state capitol building in Springfield, Illinois. — Like the rest of Illinois, Springfield pays a lot in taxes before the refunds come in. | fotoguy22/iStock/Getty Images

Average refund: $2,815

Between property taxes in the U.S., the state income tax rate, and unfavorable sale taxes (especially in Chicago), Illinois has the highest taxes in the land. Receiving more than $2,800 in federal refunds is a nice bonus for people living in the Land of Lincoln. Until, of course, you find out the national average is $2,895, according to the folks at HowMuch.

Next: A state already winning big could win bigger very soon.

11. Wyoming

The sun hits the tips of the Grand Tetons October 5, 2012 in the Grand Teton National Park in Wyoming — The mountains are high in Wyoming, and so are the tax refunds. | Karen Bleier/AFP/Getty Images

Average refund: $2,853

As if receiving some of the highest tax refunds wasn’t enough, Wyoming looks to be a big winner from Donald Trump’s tax plan. The state received the fewest number of refunds for the 2016 tax year, but its refund amount is just outside our top 10.

Next: Where the average refund is good for three months’ rent.

10. Florida

Palm trees at sunrise in Hollywood, Florida — Between the refunds and the lack of state income tax, Florida is a paradise. | typhoonski/iStock/Getty Images

Average refund: $2,877

The Sunshine State is one of the places Americans don’t want to live in anymore, but they might think twice after seeing their tax refunds. The $2,877 rebate isn’t just shy of the national average, but as SmartAsset notes, that amount pays close to three months’ rent at the state average.

Next: A state that sounds like a tax Shangri-La.

9. North Dakota

Fargo, North Dakota, United States — North Dakota: Home to low taxes and big refunds. | Ben Harding/iStock/Getty Images

Average refund: $2,896

Of the states collecting income taxes, North Dakota’s marginal rate is one of the lowest in the country. Couple that with one of the highest federal refunds, and you have a virtual tax Shangri-La. All that’s left is figuring out how to spend your refund.

Next: Your refund might help you fend off bankruptcy.

8. Washington, D.C.

Washington DC in Spring — The cost of living in Washington, D.C., is high, but so are the tax refunds. | SeanPavonePhoto/iStock/Getty Images

Average refund: $2,904

If you try living in Washington, D.C. on $50,000 a year, you’ll end up broke. But hey, at least your tax refund is one of the highest in the country. Close to 275,000 refunds added up to nearly $797 million in the 2016 tax year.

Next: Good news and bad news in this state.

7. New Jersey

Who wants a big tax refund? New Jersey’s famous son Bruce Springsteen does. | Mike Coppola/Getty Images

Average refund: $2,943

First the bad news, New Jersey: At more than $19,000, your average income tax bill is one of the highest in the country. The good news is your average refund is also one of the highest in the U.S. Unfortunately, New Jersey’s property taxes are among the highest in the land, so that big refund won’t stretch very far.

Next: Where your refund goes a long way.

6. Mississippi

Jackson, Mississippi — Your big refund goes a long way in Mississippi. | SeanPavonePhoto/iStock/Getty Images

Average refund: $2,953

Yes, New Jersey and Mississippi have the same average income tax refund amount, but Mississippi is higher on the list for one reason: Cost of living. A $2,953 refund in Mississippi pays for four months of rent for an average two-bedroom apartment.

Next: You’ll get a nice refund at tax time after paying through the nose the rest of the year.

5. Connecticut

Hartford, Connecticut skyline — It costs a lot to live in Connecticut, but the tax refunds help make up for it. | SeanPavonePhoto/ Getty Images Plus

Average refund: $2,958

Connecticut is one of the states no one wants to live in during retirement. The high taxes, especially income and property taxes, have something to do with it. Despite that, Connecticut is in the top 5 of states where people get the biggest tax refunds. Residents catch a slight break at tax time with an average refund of nearly $3,000.

Next: Connecticut’s neighbor catches a break.

4. New York

The New York City skyline. — New York City, like the rest of the state, pays a ton of taxes and receives big refunds. | fietstouring/iStock/Getty Images

Average refund: $2,986

New York is one of the most heavily taxed states in the U.S. The property taxes, sales tax, and state income tax rank among the highest in the country. Come refund season, however, Empire State residents receive some of the largest refunds anywhere.

Next: We’re staying in one area of the country from here on out.

3. Louisiana

In New Orleans on Bourbon St. on August 7, 2013 a jazz band plays jazz melodies in the street for donations from the tourists and locals passing by on this hot summer evening — Lousiana residents have a reason to celebrate when they see their tax refunds. | Simplyphotos/iStock/Getty Images

Average refund: $3,073

In the 2016 tax year, over 1.6 million Louisiana taxpayers received refunds that added up to more than $5 billion. With a relatively low cost of living in Louisiana, that refund stretches pretty far.

Next: Big refunds in an affordable state.

2. Oklahoma

Oklahoma city — Oklahoma City residents get more than $3,000 come tax refund time. | Saul Loeb/AFP/Getty Images

Average refund: $3,088

Want to maximize your tax refund? Consider moving to Oklahoma and filing there. Oklahomans receive some of the biggest tax refunds in the country. The Sooner State is one of the most affordable states to live in, so an average $3,088 refund goes a long way.

Next: Big state, big refunds

1. Texas

Austin Texas Reflections Lady Bird Lake — The stars at night, and peoples’ eyes when they see their tax refunds, are big in Texas. | RoschetzkyIstockPhoto/iStock/Getty Images

Average refund: $3,133

The stars at night aren’t the only things that are big and bright deep in the heart of Texas. So are people’s eyes when they see their giant tax refunds. Texas supposedly has one of the least-fair tax systems in the U.S., but with its huge refunds and no state income, it sounds like paradise.

Check out The Cheat Sheet on Facebook!