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Official Tax Guide

New York Taxes 2025: Income, Sales, and Property Tax Guide

Complete guide to New York state taxes. Income tax (4% - 10.9%), sales tax, and what you need to know before moving.

Updated January 15, 2026
5 min read

New York State Tax Guide 2025

Moving to New York involves navigating a complex tax landscape. This guide provides an overview of the state's tax structure for 2025, focusing on key areas relevant to new residents. Please note that tax laws are subject to change, and individual circumstances vary.

1. Income Tax

New York State imposes a progressive income tax on residents. This means your tax rate increases as your income rises. The state tax rates for the 2025 tax year (filing in 2026) are expected to remain within the following brackets:

  • 4% on income up to $8,500
  • 4.5% on income between $8,500 and $11,700
  • 5.25% on income between $11,700 and $13,900
  • 5.85% on income between $13,900 and $80,650
  • 6.25% on income between $80,650 and $215,400
  • 6.85% on income between $215,400 and $1,077,550
  • 9.65% on income between $1,077,550 and $5,000,000
  • 10.3% on income between $5,000,000 and $25,000,000
  • 10.9% on income over $25,000,000

Note: These brackets are illustrative based on the 4% - 10.9% range. Specific thresholds may adjust for inflation. NYC residents also pay a local city income tax.

2. Sales Tax

The New York State sales tax rate is 4%. However, this is only the base rate. Combined with local county and city taxes, the total sales tax rate can be significantly higher, often ranging from 7% to 8.875% depending on the location.

  • Clothing and Footwear: Exempt from state sales tax if the item costs less than $110 per item.
  • Prepared Food: Generally subject to sales tax, including restaurant meals and takeout.

3. Property Tax

Property taxes in New York are primarily levied at the local level (counties, cities, school districts). They are a significant source of revenue for local governments.

  • General Context: New York's property tax burden is generally higher than the national average. Effective tax rates can vary widely.
  • Typical Range: While highly dependent on the municipality and school district, homeowners might encounter effective tax rates ranging from 1.5% to over 3% of the assessed property value.
  • STAR Program: The School Tax Relief (STAR) program provides property tax exemptions for primary residences. Basic STAR is available for owner-occupied, primary residences where the combined income of the owners is $500,000 or less.

4. Other Notable Taxes

  • Gas Tax: New York imposes a state excise tax on gasoline. As of 2025, the state gas tax is approximately $0.30 per gallon, though this can fluctuate.
  • "Sin" Taxes: New York has higher excise taxes on tobacco products and alcohol.
  • Estate/Inheritance Tax: New York has an estate tax (not an inheritance tax) that applies to estates exceeding a certain threshold (often indexed for inflation, around $6.94 million in recent years). It is not a tax on the beneficiary but on the estate itself.

5. Retiree Taxes

  • Social Security Benefits: Exempt from New York State income tax.
  • Retirement Income (Pensions, 401(k), IRA Distributions): Generally taxable. However, New York provides a pension and annuity exclusion for taxpayers age 59½ or older, up to $20,000 per year for single filers and $40,000 for married couples filing jointly, provided federal adjusted gross income (AGI) is below certain limits.
  • Other Retirement Income: Railroad Retirement benefits are exempt. Military retirement pay may have specific exclusions.

6. Comparison to Neighbors

  • New Jersey: Generally has a higher average property tax rate but lower income tax rates for middle-income earners. No sales tax on clothing.
  • Connecticut: Has a progressive income tax (up to 6.99% for 2025) and a 6.35% sales tax. Property taxes vary by town.
  • Pennsylvania: Has a flat 3.07% income tax rate and no sales tax on clothing. Property taxes vary by locality.
  • Vermont: Has a progressive income tax (up to 8.75%) and a 6% sales tax. Property taxes are generally high.

Disclaimer: Tax laws change frequently and can vary based on individual circumstances. This guide is for informational purposes only and should not be considered legal or financial advice. Consult a qualified CPA or tax professional for advice tailored to your situation.