Delaware tax guide
Delaware's tax system is designed with six progressive income tax brackets, ensuring that tax rates increase as your income rises. This structure is balanced by the absence of a state sales tax, which distinguishes it from many surrounding states. Understanding your specific bracket is essential for accurate paycheck forecasting.
Key tax highlights
Payroll
- Delaware employs a progressive tax structure with rates ranging from 2.20% to 6.60%.
- Employers are required to withhold state income tax based on the current withholding tables provided by the Delaware Division of Revenue.
- The top marginal tax rate of 6.60% applies to taxable income exceeding $60,000.
Local taxes
- Unlike many states, Delaware does not impose a state-level sales tax, which provides significant relief on daily consumer purchases.
- Some municipalities in Delaware, such as Wilmington, impose a local occupational privilege tax or city wage tax that must be accounted for on your paycheck.
Deductions
- Delaware residents can claim a personal tax credit of $110, which reduces total tax liability rather than taxable income.
- The state allows for standard deductions that are adjusted periodically to align with cost-of-living changes.
Salary examples
Pre-computed take-home estimates at common salary levels. For example, a $75,000 salary in Delaware yields about $57,659 after all deductions (76.9% take-home rate). Use the calculator above with your actual salary to see your specific estimate.
| Salary | Federal | State | FICA | Take-Home | Rate |
|---|---|---|---|---|---|
| $50,000 | $3,820 | $2,389 | $3,825 | $39,967 | 79.9% |
| $75,000 | $7,670 | $3,934 | $5,738 | $57,659 | 76.9% |
| $100,000 | $13,170 | $5,584 | $7,650 | $73,596 | 73.6% |
| $150,000 | $24,734 | $8,883 | $11,475 | $104,908 | 69.9% |
Neighboring states
How Delaware compares with border states on income tax. At a $75,000 salary, a Delaware worker pays $3,934 in state tax annually.
| State | Tax type | Top rate |
|---|---|---|
| Pennsylvania | flat tax | 3.07% |
| Maryland | progressive | 6.50% |
| New Jersey | high tax | 10.75% |
Tax tips for Delaware
- Review your W-4 form annually to ensure your Delaware state withholding aligns with your anticipated income bracket.
- Check if your employer is located in a city like Wilmington that requires an additional local wage tax deduction.
- If you are age 60 or older, ensure you are taking advantage of the state's pension and Social Security exclusion benefits.
- Keep track of your personal tax credit to ensure it is correctly applied during your annual state filing.
Did you know?
- •Delaware is one of the few states in the U.S. that does not impose any state-level sales tax.
- •The state income tax system has remained relatively stable with six brackets for several years, providing predictability for taxpayers.
Filing guidance
Residents must file their Delaware state income tax return using Form PIT-RES if they are considered full-year residents. The Delaware Division of Revenue provides an online portal for electronic filing, which is the recommended method for faster processing of potential refunds. Ensure you have your W-2 information ready and verify your local school district code, as this is often required for accurate state tax reporting and potential credit eligibility.
Relocation context
Comparing Delaware with nearby states can reveal whether paycheck differences are driven by state tax, local tax, or payroll deductions.