America at 250: History of Income and Taxes in the US
America the beautiful is also home of the brave, with an ethos of no taxation without representation, but it is still somewhat in its infancy when compared to much older countries and cultures across the world. At the tender young age of 250, the United States is still learning and growing, so it’s always interesting to see what progress has been made.
As far as income and taxes are concerned, for your average citizen, not all states are created equal -- and some of the changes in nearly 250 years are pretty eye-popping.
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Here are some notes on early income, taxation and the history of the dollar itself:
If you back up all the way to 1774 (the closest census-quality economic benchmark to 1776), Americans at the end of the colonial era (there were no states at the time) averaged an annual income of just £13.85, according to historian Alice Hansen Jones. Though by modern standards this is hard to imagine, at the time it was the highest in the Western world.
Even when transitioning into what would become the colonies of early America, the tax rate stayed low and averaged between 1% and 1.5%.
Keep in mind that the U.S. did not have a state-sanctioned bank notes until the Civil War. The Mint Act of 1792 created the dollar coin, but it wasn't until 70 years later that paper money was printed.
MoneyLion has done some deep diving into how exactly “paychecks” have changed in the last century. The research gathering was based on data for income and taxes paid by each state from 1926 to the most recent IRS tax return data in 2022.
Key Findings
The national average net income per tax return in 1926 was $5,306, whereas it was $93,481 in 2022 (the most recent data). That means the average change in net income in nearly 100 years is about $88,175.
Seven states have increased net income by six figures, gaining the most wealth over the past century: Connecticut ($115,339), Massachusetts ($114,403), Washington ($107,703), Wyoming ($106,152), New Jersey ($104,050), California ($103,591), New Hampshire ($101,733).
California and New York pay the lion's share of net taxes among all states. California, which accounted for 6.3% in 1926, now pays 30% of all income tax in America. New York, which was around 34% in 1926, now pays just 16%. New Jersey is third at 4.8% -- and no other state is over 3.5%.
Alaska did not become a state until Jan. 3, 1959. The 1926 income tax data is included with Washington, so Alaska is unranked in this study.
Here is every state ranked by the highest to lowest change in net income per tax return.
1. Connecticut
Average Income in 1926: $5,326
Average Income in 2022: $120,665
Income Growth (1926–2022): $115,339
Share of All U.S. Income Taxes Paid in 1926: 1.88%
Share of All U.S. Income Taxes Paid in 2022: 2.45%
2. Massachusetts
Average Income in 1926: $5,122
Average Income in 2022: $119,525
Income Growth (1926–2022): $114,403
Share of All U.S. Income Taxes Paid in 1926: 5.07%
Share of All U.S. Income Taxes Paid in 2022: 3.32%
3. Washington
Average Income in 1926: $3,964
Average Income in 2022: $111,668
Income Growth (1926–2022): $107,703
Share of All U.S. Income Taxes Paid in 1926: 0.38%
Share of All U.S. Income Taxes Paid in 2022: 0.31%
4. Wyoming
Average Income in 1926: $3,556
Average Income in 2022: $109,707
Income Growth (1926–2022): $106,152
Share of All U.S. Income Taxes Paid in 1926: 0.04%
Share of All U.S. Income Taxes Paid in 2022: 0.07%
5. New Jersey
Average Income in 1926: $5,855
Average Income in 2022: $109,905
Income Growth (1926–2022): $104,050
Share of All U.S. Income Taxes Paid in 1926: 4.49%
Share of All U.S. Income Taxes Paid in 2022: 4.76%
6. California
Average Income in 1926: $4,984
Average Income in 2022: $108,575
Income Growth (1926–2022): $103,591
Share of All U.S. Income Taxes Paid in 1926: 6.31%
Share of All U.S. Income Taxes Paid in 2022: 30.05%
7. New Hampshire
Average Income in 1926: $4,369
Average Income in 2022: $106,103
Income Growth (1926–2022): $101,733
Share of All U.S. Income Taxes Paid in 1926: 0.16%
Share of All U.S. Income Taxes Paid in 2022: 0.13%
8. New York
Average Income in 1926: $6,619
Average Income in 2022: $105,392
Income Growth (1926–2022): $98,774
Share of All U.S. Income Taxes Paid in 1926: 33.74%
Share of All U.S. Income Taxes Paid in 2022: 15.93%
9. Colorado
Average Income in 1926: $4,409
Average Income in 2022: $101,160
Income Growth (1926–2022): $96,751
Share of All U.S. Income Taxes Paid in 1926: 0.40%
Share of All U.S. Income Taxes Paid in 2022: 1.90%
10. Florida
Average Income in 1926: $5,750
Average Income in 2022: $101,700
Income Growth (1926–2022): $95,950
Share of All U.S. Income Taxes Paid in 1926: 1.42%
Share of All U.S. Income Taxes Paid in 2022: 2.20%
11. Virginia
Average Income in 1926: $4,657
Average Income in 2022: $99,659
Income Growth (1926–2022): $95,002
Share of All U.S. Income Taxes Paid in 1926: 0.48%
Share of All U.S. Income Taxes Paid in 2022: 3.19%
12. Nevada
Average Income in 1926: $3,501
Average Income in 2022: $94,703
Income Growth (1926–2022): $91,202
Share of All U.S. Income Taxes Paid in 1926: 0.03%
Share of All U.S. Income Taxes Paid in 2022: 0.38%
13. Maryland
Average Income in 1926: $5,580
Average Income in 2022: $96,385
Income Growth (1926–2022): $90,805
Share of All U.S. Income Taxes Paid in 1926: 1.57%
Share of All U.S. Income Taxes Paid in 2022: 3.42%
14. Illinois
Average Income in 1926: $5,324
Average Income in 2022: $95,941
Income Growth (1926–2022): $90,617
Share of All U.S. Income Taxes Paid in 1926: 8.77%
Share of All U.S. Income Taxes Paid in 2022: 3.07%
15. Utah
Average Income in 1926: $3,968
Average Income in 2022: $93,977
Income Growth (1926–2022): $90,009
Share of All U.S. Income Taxes Paid in 1926: 0.09%
Share of All U.S. Income Taxes Paid in 2022: 1.20%
16. North Dakota
Average Income in 1926: $3,357
Average Income in 2022: $92,838
Income Growth (1926–2022): $89,481
Share of All U.S. Income Taxes Paid in 1926: 0.02%
Share of All U.S. Income Taxes Paid in 2022: 0.07%
17. Minnesota
Average Income in 1926: $4,615
Average Income in 2022: $92,952
Income Growth (1926–2022): $88,337
Share of All U.S. Income Taxes Paid in 1926: 0.88%
Share of All U.S. Income Taxes Paid in 2022: 1.98%
18. Texas
Average Income in 1926: $4,914
Average Income in 2022: $92,552
Income Growth (1926–2022): $87,638
Share of All U.S. Income Taxes Paid in 1926: 1.73%
Share of All U.S. Income Taxes Paid in 2022: 0.79%
19. South Dakota
Average Income in 1926: $3,073
Average Income in 2022: $89,169
Income Growth (1926–2022): $86,096
Share of All U.S. Income Taxes Paid in 1926: 0.03%
Share of All U.S. Income Taxes Paid in 2022: 0.04%
20. Montana
Average Income in 1926: $3,662
Average Income in 2022: $86,966
Income Growth (1926–2022): $83,304
Share of All U.S. Income Taxes Paid in 1926: 0.08%
Share of All U.S. Income Taxes Paid in 2022: 0.34%
21. Oregon
Average Income in 1926: $4,362
Average Income in 2022: $86,755
Income Growth (1926–2022): $82,393
Share of All U.S. Income Taxes Paid in 1926: 0.30%
Share of All U.S. Income Taxes Paid in 2022: 1.64%
22. Pennsylvania
Average Income in 1926: $5,378
Average Income in 2022: $87,694
Income Growth (1926–2022): $82,316
Share of All U.S. Income Taxes Paid in 1926: 10.50%
Share of All U.S. Income Taxes Paid in 2022: 2.26%
23. Arizona
Average Income in 1926: $3,970
Average Income in 2022: $85,846
Income Growth (1926–2022): $81,877
Share of All U.S. Income Taxes Paid in 1926: 0.07%
Share of All U.S. Income Taxes Paid in 2022: 1.24%
24. Nebraska
Average Income in 1926: $4,001
Average Income in 2022: $85,800
Income Growth (1926–2022): $81,800
Share of All U.S. Income Taxes Paid in 1926: 0.19%
Share of All U.S. Income Taxes Paid in 2022: 0.17%
25. Idaho
Average Income in 1926: $3,434
Average Income in 2022: $84,629
Income Growth (1926–2022): $81,195
Share of All U.S. Income Taxes Paid in 1926: 0.03%
Share of All U.S. Income Taxes Paid in 2022: 0.38%
26. Wisconsin
Average Income in 1926: $4,107
Average Income in 2022: $84,149
Income Growth (1926–2022): $80,042
Share of All U.S. Income Taxes Paid in 1926: 1.15%
Share of All U.S. Income Taxes Paid in 2022: 1.02%
27. North Carolina
Average Income in 1926: $4,337
Average Income in 2022: $84,256
Income Growth (1926–2022): $79,919
Share of All U.S. Income Taxes Paid in 1926: 0.46%
Share of All U.S. Income Taxes Paid in 2022: 2.19%
28. Hawaii
Average Income in 1926: $4,696
Average Income in 2022: $84,432
Income Growth (1926–2022): $79,736
Share of All U.S. Income Taxes Paid in 1926: 0.15%
Share of All U.S. Income Taxes Paid in 2022: 0.55%
29. Rhode Island
Average Income in 1926: $5,882
Average Income in 2022: $85,158
Income Growth (1926–2022): $79,277
Share of All U.S. Income Taxes Paid in 1926: 0.76%
Share of All U.S. Income Taxes Paid in 2022: 0.24%
30. Iowa
Average Income in 1926: $4,103
Average Income in 2022: $83,242
Income Growth (1926–2022): $79,139
Share of All U.S. Income Taxes Paid in 1926: 0.40%
Share of All U.S. Income Taxes Paid in 2022: 0.43%
31. Kansas
Average Income in 1926: $4,695
Average Income in 2022: $83,580
Income Growth (1926–2022): $78,885
Share of All U.S. Income Taxes Paid in 1926: 0.38%
Share of All U.S. Income Taxes Paid in 2022: 0.57%
32. Tennessee
Average Income in 1926: $4,950
Average Income in 2022: $83,339
Income Growth (1926–2022): $78,389
Share of All U.S. Income Taxes Paid in 1926: 0.50%
Share of All U.S. Income Taxes Paid in 2022: 0.23%
33. Georgia
Average Income in 1926: $4,658
Average Income in 2022: $83,011
Income Growth (1926–2022): $78,353
Share of All U.S. Income Taxes Paid in 1926: 0.39%
Share of All U.S. Income Taxes Paid in 2022: 2.74%
34. Delaware
Average Income in 1926: $7,585
Average Income in 2022: $84,996
Income Growth (1926–2022): $77,411
Share of All U.S. Income Taxes Paid in 1926: 0.70%
Share of All U.S. Income Taxes Paid in 2022: 0.25%
35. Vermont
Average Income in 1926: $4,882
Average Income in 2022: $81,724
Income Growth (1926–2022): $76,843
Share of All U.S. Income Taxes Paid in 1926: 0.11%
Share of All U.S. Income Taxes Paid in 2022: 0.16%
36. South Carolina
Average Income in 1926: $3,842
Average Income in 2022: $77,856
Income Growth (1926–2022): $74,013
Share of All U.S. Income Taxes Paid in 1926: 0.06%
Share of All U.S. Income Taxes Paid in 2022: 0.96%
37. Missouri
Average Income in 1926: $5,153
Average Income in 2022: $79,097
Income Growth (1926–2022): $73,944
Share of All U.S. Income Taxes Paid in 1926: 1.84%
Share of All U.S. Income Taxes Paid in 2022: 0.89%
38. Michigan
Average Income in 1926: $5,123
Average Income in 2022: $78,653
Income Growth (1926–2022): $73,530
Share of All U.S. Income Taxes Paid in 1926: 4.42%
Share of All U.S. Income Taxes Paid in 2022: 1.28%
39. Ohio
Average Income in 1926: $4,959
Average Income in 2022: $77,737
Income Growth (1926–2022): $72,778
Share of All U.S. Income Taxes Paid in 1926: 4.48%
Share of All U.S. Income Taxes Paid in 2022: 1.56%
40. Maine
Average Income in 1926: $5,479
Average Income in 2022: $77,460
Income Growth (1926–2022): $71,981
Share of All U.S. Income Taxes Paid in 1926: 0.47%
Share of All U.S. Income Taxes Paid in 2022: 0.27%
41. Indiana
Average Income in 1926: $4,650
Average Income in 2022: $76,486
Income Growth (1926–2022): $71,836
Share of All U.S. Income Taxes Paid in 1926: 1.36%
Share of All U.S. Income Taxes Paid in 2022: 1.08%
42. Arkansas
Average Income in 1926: $4,372
Average Income in 2022: $74,511
Income Growth (1926–2022): $70,139
Share of All U.S. Income Taxes Paid in 1926: 0.20%
Share of All U.S. Income Taxes Paid in 2022: 0.54%
43. Alabama
Average Income in 1926: $4,784
Average Income in 2022: $74,708
Income Growth (1926–2022): $69,925
Share of All U.S. Income Taxes Paid in 1926: 0.33%
Share of All U.S. Income Taxes Paid in 2022: 0.58%
44. Oklahoma
Average Income in 1926: $5,948
Average Income in 2022: $73,802
Income Growth (1926–2022): $67,854
Share of All U.S. Income Taxes Paid in 1926: 1.11%
Share of All U.S. Income Taxes Paid in 2022: 0.43%
45. Louisiana
Average Income in 1926: $4,756
Average Income in 2022: $72,104
Income Growth (1926–2022): $67,348
Share of All U.S. Income Taxes Paid in 1926: 0.45%
Share of All U.S. Income Taxes Paid in 2022: 0.48%
46. Kentucky
Average Income in 1926: $5,152
Average Income in 2022: $71,093
Income Growth (1926–2022): $65,941
Share of All U.S. Income Taxes Paid in 1926: 0.44%
Share of All U.S. Income Taxes Paid in 2022: 0.61%
47. New Mexico
Average Income in 1926: $3,782
Average Income in 2022: $66,216
Income Growth (1926–2022): $62,434
Share of All U.S. Income Taxes Paid in 1926: 0.03%
Share of All U.S. Income Taxes Paid in 2022: 0.21%
48. West Virginia
Average Income in 1926: $4,345
Average Income in 2022: $65,563
Income Growth (1926–2022): $61,218
Share of All U.S. Income Taxes Paid in 1926: 0.31%
Share of All U.S. Income Taxes Paid in 2022: 0.17%
49. Mississippi
Average Income in 1926: $3,772
Average Income in 2022: $64,050
Income Growth (1926–2022): $60,278
Share of All U.S. Income Taxes Paid in 1926: 0.09%
Share of All U.S. Income Taxes Paid in 2022: 0.28%
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Methodology: For this study, MoneyLion analyzed the income and taxes paid by each state from 1926 to the most recent IRS tax return data. Using the Statistics of Income tax return data from the IRS for 1926 and 2022, MoneyLion found the number of returns, percentage of returns, net income, percentage net income, average net income per return, tax amount, percentage of tax and average income tax per return. Using both years, the changes were calculated for the number of returns, net income, average net income per return, tax amount and average income tax per return. The states were sorted by the change in net income, with the largest increase in net income ranking first. All data is up to date as of June 16, 2026.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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