Tax Data, Charts, and Maps
Federal Taxes Paid vs. Spending Received by State
States send federal taxes to Washington and receive federal spending in return. However, some states benefit more from federal taxing and spending policies than others. Some "beneficiary" states receive a positive return from Uncle Sam, making other states "donors" who pick up the tab. The most important factor determining whether a state is a net beneficiary is per capita income. States with wealthier residents pay higher federal taxes per capita thanks to the progressive structure of the income tax. Other factors include whether states have powerful Members of Congress, the number of federal employees present in a state, and the number of residents receiving Social Security, Medicare and other federal entitlements.
Additional questions about federal taxes paid vs. spending received by state? Contact us at (202) 464-6200.
Tax Data from The Tax Foundation
- Federal Taxes Paid vs. Federal Spending Received by State, 1981-2005 , October 19, 2007
- Federal Spending Received Per Dollar of Taxes Paid by State, 2005, October 9, 2007