In this article, we break down the NYC income tax brackets for different filing statuses, explain available tax credits, and discuss some ways to reduce or avoid paying the city income tax. We also cover other important considerations, like how selling property or renting it out can affect your taxes. If you're looking for ways to manage or lower your NYC income taxes, this guide has got you covered.
Table of Contents
How Much Is Income Tax in NYC?
New York City Tax Brackets 2024
Are There Any NYC Income Tax Deductions?
NYC Income Tax Credits
Other NYC Income Tax Considerations
Can You Avoid NYC Income Tax?
New York State Income Tax Brackets 2024
NYC Income Tax Bottom Line
How Much Is Income Tax in NYC?
The New York City income tax rates are 3.078%, 3.762%, 3.819%, and 3.876%, depending on which income bracket you are in. Where you fall within these brackets depends on your filing status and how much you earn annually. In addition to the NYC income tax, you'll also need to pay New York State taxes, which range from 4% to 10.9%. This means the cumulative income tax for NYC residents is between 7.078% and 14.776%.
Below are the NYC tax rates for Tax Year 2023, which you'll pay on the tax return you file by April 2024.
New York City Tax Brackets 2024
- Married Filing Jointly NYC Tax Brackets
- Single or Married Filing Separately NYC Tax Brackets
- Head of Household NYC Tax Brackets
1. Married Filing Jointly NYC Tax Brackets
- Earning less than $21,600: 3.078%
- Earning between $21,600 and $45,000: $665 plus 3.762% of the excess over $21,600
- Earning between $45,000 and $90,000: $1,545 plus 3.819% of the excess over $45,000
- Earning over $90,000: $3,264 plus 3.876% of the excess over $90,000
2. Single or Married Filing Separately NYC Tax Brackets
- Earning less than $12,000: 3.078%
- Earning between $12,000 and $25,000: $369 plus 3.762% of the excess over $12,000
- Earning between $25,000 and $50,000: $858 plus 3.819% of the excess over $25,000
- Earning more than $50,000: $1,813 plus 3.867% of the excess over $50,000
3. Head of Household NYC Tax Brackets
- Earning less than $14,400: 3.078%
- Earning between $14,400 and $30,000: $443 plus 3.762% of the excess over $14,400
- Earning between $30,000 and $60,000: $858 plus 3.819% of the excess over $30,000
- Earning more than $60,000: $2,176 plus 3.867% of the excess over $60,000
Are There Any NYC Income Tax Deductions?
No, there are no tax deductions specific to NYC income tax. This is because NYC calculates your income based on your net New York State taxable income after you claim any applicable state income-tax deductions.
NYC Income Tax Credits
Because there are no deductions available for personal income tax, the best way to reduce the amount that you have to pay is to offset what you owe by deducting tax credits from your state income taxes. The following tax credits may help reduce the total amount of taxes that you pay.
- NYC School Tax Credit
- NYC Household Credit
- NYC Earned Income Credit
- NYC Child and Dependent Care Credit
- NYC Real Property Credit
1. NYC School Tax Credit
The NYC School tax credit is available to NYC residents who have a total household income below $250,000. Individual taxpayers who cannot be claimed by another are eligible for a $63 credit. Those filing jointly would receive a $125 credit. To claim this credit, you also cannot be claimed as a dependant on another filer’s tax return.
2. NYC Household Credit
If you cannot be claimed on another filer’s tax return, you are eligible for the New York City Household Credit of between $15 and $30 in credit. Additional credit is available for each dependent you claim.
3. New York City Earned Income Credit
Both NY state and NYC offer an earned income tax credit. The NYC earned income credit is equal to 5% of your allowable federal earned income tax credit.
4. NYC Child and Dependent Care Credit
NYC residents who paid child care expenses for a child under 4 years of age may be eligible for up to 75% of your NY State Dependent Care Credit. To be eligible for the NYC Child and Dependent Care Credit, your household income cannot exceed $30,000.
5. NYC Real Property Credit
The NYC Real Property Credit is available to renters and homeowners that reside in a property that is not exempt from real property taxes. Total household income must be less than $200,000. The credit is for up to $500.
Other NYC Income Tax Considerations
There are additional points to consider, mainly if you have sold a home in NYC for profit. Generally speaking, unless you earned more than $250,000 dollars (single) or $500,000 (married filing jointly) in profit, the money that you pocket from the sale of your home is not included in your income tax.
However, with the current property prices in NYC, there’s a very good chance that you might exceed those limits, especially if you are selling a property that you have owned for a long time. In this case, you could be required to pay personal income tax on any profit that exceeds the limits.
If you own property that you rent out, be aware that rental property appreciation isn’t taxed until you sell that property.
Can You Avoid NYC Income Tax?
No, you cannot avoid NYC income tax. This means that, if you’ve already tried offsetting what you owe with state income tax credits, you’re out of options for further reducing your taxes. However, there are some loopholes that could help you avoid paying personal income tax in the future.
The biggest and most obvious loophole is to live in the city for 182 days of the year or fewer. If you can manage this, you can save big on taxes. Since personal income taxes don’t apply to non-residents, living in the city for less than half the year means that you won’t have to fork out the cash to cover personal income tax, even if you have a residence in the city. The bad news is that, unless you’re very well-off or happen to own two homes, this is difficult to achieve, and simply won’t be possible for most people.
The second option, and one which more and more people are choosing, is to live outside the city but commute to work daily. For example, you can avoid NYC income taxes if you live in New Jersey and commute to work in the city. And you can reach Manhattan in as little as thirty minutes from cities like Hoboken, Jersey City, or the many suburban towns in NJ. You’re close enough to the city to visit and work, but reap the benefits of cheaper housing, more space, and the avoidance of that pesky personal income tax. And you're not limited to NJ. If you want to save on your tax bill, you can also explore many great commuter towns in Connecticut and Long Island.
New York State Income Tax Brackets 2024
1. Single & Married Filing Separately New York State Income Tax Brackets
|
NY State Income Tax Rate |
Income Bracket |
Tax Owed |
|
4% |
$0 to $8,500 |
4% |
|
4.5% |
$8,501 to $11,700 |
$340 plus 4.5% of the excess over $8,500 |
|
5.25% |
$11,701 to $13,900 |
$484 plus 5.25% of the excess over $11,700 |
|
5.85% |
$13,901 to $80,650 |
$600 plus 5.85% of the excess over $13,900 |
|
6.25% |
$80,651 to $215,400 |
$4,504 plus 6.25% of the excess over $80,650 |
|
6.85% |
$215,401 to $1,077,550 |
$12,926 plus 6.85% of the excess over $215,400 |
|
9.65% |
$1,077,551 to $5,000,000 |
$71,984 plus 9.65% of the excess over $1,077,550 |
|
10.30% |
$5,000,001 to $25,000,000 |
$450,500 plus 10.30% of the excess over $5,000,000 |
|
10.90% |
$25,000,001 |
$2,510,500 plus 10.90% of the excess over $25,000,000 |
2. Married Filing Jointly New York State Income Tax Brackets
|
NY State Income Tax Rate |
Income Bracket |
Tax Owed |
|
4% |
$0 to $17,150 |
4% |
|
4.5% |
$17,151 to $23,600 |
$686 plus 4.5% of the excess over $17,150 |
|
5.25% |
$23,601 to $27,900 |
$976 plus 5.25% of the excess over $23,600 |
|
5.85% |
$27,901 to $161,550 |
$1,202 plus 5.85% of the excess over $27,900 |
|
6.25% |
$161,551 to $323,200 |
$9,021 plus 6.25% of the excess over $161,550 |
|
6.85% |
$323,201 to $2,155,350 |
$19,124 plus 6.85% of the excess over $323,200 |
|
9.65% |
$2,155,351 to $5,000,000 |
$144,626 plus 9.65% of the excess over $2,155,350 |
|
10.30% |
$5,000,001 to $25,000,000 |
$419,135 plus 10.30% of the excess over $5,000,000 |
|
10.90% |
$25,000,001 |
$2,479,135 plus 10.90% of the excess over $25,000,000 |
3. Head of Household New York State Income Tax Brackets
|
NY State Income Tax Rate |
Income Bracket |
Tax Owed |
|
4% |
$0 to $12,800 |
4% |
|
4.5% |
$12,801 to $17,650 |
$512 plus 4.5% of the excess over $12,800 |
|
5.25% |
$17,651 to $20,900 |
$730 plus 5.25% of the excess over $17,650 |
|
5.85% |
$20,901 to $107,650 |
$901 plus 5.85% of the excess over $20,900 |
|
6.25% |
$107,651 to $269,300 |
$5,976 plus 6.25% of the excess over $107,650 |
|
6.85% |
$269,301 to $1,616,450 |
$16,079 plus 6.85% of the excess over $269,300 |
|
9.65% |
$1,616,451 to $5,000,000 |
$108,359 plus 9.65% of the excess over $1,616,450 |
|
10.30% |
$5,000,001 to $25,000,000 |
$434,871 plus 10.30% of the excess over $5,000,000 |
|
10.90% |
$25,000,001 |
$2,494,871 plus 10.90% of the excess over $25,000,000 |
NYC Income Tax Bottom Line
Paying close to 4% in personal income tax is a hefty pill to swallow for many New Yorkers. Living in New York City comes with a high tax burden, but it also offers unique opportunities for higher income and career growth. While the city's vibrant life and job market attract many people, the high taxes can be a downside.
If you're looking to reduce your tax bill, consider living outside the city and commuting, as many have found this to be a practical way to enjoy the benefits of NYC without the high personal income taxes. However, for those who choose to stay, understanding the tax brackets, credits, and potential deductions can help you better manage your financial obligations.