New York State Income Tax Guide (2026)
New York has a progressive state income tax system with rates ranging from 4% to 8.82%. New York City residents pay an additional city income tax. The state's tax structure can significantly impact your take-home pay, especially for high earners.
Last updated: January 6, 2026
- •New York has a state income tax calculated separately from federal tax. Your employer withholds state tax from each paycheck.
- •State tax rates and brackets differ from federal tax. Your state taxable income may differ from federal taxable income.
- •Understanding your state's tax structure helps you accurately calculate take-home pay and plan your finances.
How income tax works in New York
New York has a state income tax that is calculated separately from your federal income tax. Your employer withholds state income tax from each paycheck based on your filing status, income level, and the information you provide on your state withholding form.
Key Takeaway
New York has a state income tax that is calculated separately from your federal income tax. Your employer withholds state income tax from each paycheck based on your filing status, income level, and the information you provide on your state withholding form.
State income tax is calculated using progressive tax brackets, meaning different portions of your income are taxed at different rates. Your marginal state tax rate is the rate on your highest dollar of income, while your effective state tax rate is the average rate you pay on all your income.
The amount withheld depends on your gross pay, pay frequency, filing status, and withholding allowances. State tax is calculated on your taxable income after the standard deduction and other adjustments.
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State tax structure
New York uses a progressive tax system with multiple brackets. The tax rate increases as your income increases, but only the income within each bracket is taxed at that bracket's rate.
New York uses a progressive tax system with multiple brackets. The tax rate increases as your income increases, but only the income within each bracket is taxed at that bracket's rate. This means your effective state tax rate—the average rate you pay on all your income—is typically lower than your marginal rate.
| Bracket Count | Rate Range | Top Rate Applies To |
|---|---|---|
| 8 brackets | 4% - 8.82% | Taxable income over $1,077,550 (single filers) |
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Local taxes
Some cities and municipalities in New York levy local income taxes in addition to state income tax. These local taxes are typically a flat percentage of your income and are withheld by your employer if you work in a jurisdiction that requires it.
Work Location Matters
Some cities and municipalities in New York levy local income taxes in addition to state income tax. These local taxes are typically a flat percentage of your income and are withheld by your employer if you work in a jurisdiction that requires it.
New York City residents pay an additional city income tax on top of state tax. The city tax rates range from 3.078% to 3.876% depending on income level. Non-residents who work in New York City may also be subject to city tax on income earned in the city.
Local tax rates vary by jurisdiction and can change annually. Your employer should automatically withhold local taxes if applicable to your work location. If you're unsure whether you're subject to local tax, check with your employer or local tax authority.
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Bonuses & supplemental wages in New York
Bonuses, commissions, and other supplemental wages are subject to the same state income tax rates as your regular wages. However, employers may use different withholding methods that can make bonuses appear to be taxed at a higher rate.
Learn More
In New York, bonuses are taxed at your regular state income tax rate. The withholding method your employer uses can make it seem like bonuses are taxed more heavily, but when you file your tax return, bonuses are taxed at your actual marginal rate.
If your employer uses the aggregate method, they add the bonus to your regular paycheck and calculate withholding as if you earn that amount every pay period. This can result in higher withholding because it assumes you're in a higher tax bracket.
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RSUs & equity compensation in New York
When restricted stock units (RSUs) vest, they are treated as ordinary income for both federal and state tax purposes. Your employer typically withholds federal and state income tax, plus Social Security and Medicare, at the time of vesting.
Planning Tip
In New York, the value of vested RSUs is subject to state income tax at your regular state tax rate. If you sell the shares immediately after vesting, you may have little to no capital gains. If you hold the shares and sell later, any appreciation is subject to capital gains tax at both the federal and state level.
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Common paycheck surprises in New York
Several situations can cause unexpected changes in your take-home pay in New York, including mid-year raises, multiple jobs, and overtime.
Several situations can cause unexpected changes in your take-home pay in New York:
- Mid-year raises: A raise mid-year can push you into a higher state and federal tax bracket, increasing your effective tax rate for the remainder of the year. This means more tax is withheld from each paycheck.
- Multiple jobs: If you work multiple jobs, each employer withholds as if that job is your only income. This can result in under-withholding, especially if you're in New York and state tax brackets are progressive.
- Overtime: Overtime pay is taxed at the same rate as regular pay, but higher gross pay means more tax withheld. The additional withholding may make it seem like overtime is taxed more heavily, but it's just more income being taxed at your regular rate.
- Local tax changes: Moving to a different city or municipality in New York can change your local tax rate. If you start working in a new jurisdiction, your employer should automatically update withholding.
How this affects your take-home pay
New York state income tax directly reduces your take-home pay. The amount depends on your income level, filing status, and the specific tax rates in New York.
Total Tax Burden
New York state income tax directly reduces your take-home pay. The amount depends on your income level, filing status, and the specific tax rates in New York. Combined with federal taxes, state tax can significantly impact your net pay.
To see exactly how New York state income tax affects your paycheck, use our calculator above. You can adjust your income, filing status, and deductions to see how different scenarios affect your net pay.
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