Which States Are Cutting Income Taxes
6 states have already enacted an individual income tax cut taking effect in 2027 — 4 of them are a cut to the rate itself. 1 enacted an increase over the same period. This page tracks the next tax year and updates as legislatures act; it currently shows 2027.
Enacted law only. A rate cut that a legislature has announced, a bill still in committee, a ballot measure not yet passed, and a scheduled reduction whose revenue trigger has not been certified are all excluded — and the 6 jurisdictions in that position are named below with the reason.
Every enacted change for 2027
| Jurisdiction | Direction | What changes | From | To | Effective |
|---|---|---|---|---|---|
| Indiana | Cut | rate | 2.95% flat (2026) | 2.90% flat | January 1, 2027 |
| Nebraska | Cut | rate | 4.55% top rate (2026) | 3.99% top rate | January 1, 2027 |
| Montana | Cut | rate | 5.65% above $47,500 single / $95,000 joint / $71,250 head of household (2026) | 5.4% above $65,000 single / $130,000 joint / $97,500 head of household | January 1, 2027 |
| Mississippi | Cut | rate | 4% on taxable income over $10,000 (2026) | 3.75% on taxable income over $10,000 | January 1, 2027 |
| Rhode Island | Cut | exemption | Modification required both full retirement age and AGI below the threshold (2016-2026) | Income threshold only; the age requirement is removed | January 1, 2027 |
| Rhode Island | Cut | credit | No Rhode Island child tax credit | $330 refundable credit per child, phasing out above $88,500 / $110,640 AGI | January 1, 2027 |
| Rhode Island | Increase | base | Temporary decoupling under the FY2026 budget | Permanent decoupling from IRC ss 163(j) and 1202 from tax year 2027 | January 1, 2027 |
| Virginia | Cut | deduction | $8,750 single / $17,500 married (2025-2026) | $9,200 single / $18,400 married | January 1, 2027 |
State by state
Indiana
Indiana's flat individual adjusted gross income tax rate falls from 2.95% to 2.90%, the last step of the reduction schedule enacted in 2023. The Department of Revenue's own rates page states the rate "will adjust in 2027 to 2.90%".
Affected brackets: The single flat rate; Indiana has no brackets.
H.E.A. 1001 (2023), phasing IC 6-3-2-1 to 2.90%. Effective . Source: Indiana Department of Revenue — Rates, Fees & Penalties — individual adjusted gross income tax rate by year (retrieved 2026-09-19)
Mississippi
Mississippi's rate on taxable income above $10,000 falls from 4% to 3.75%, the first step of the phase-out enacted by House Bill 1 in 2025. The enrolled bill sets 3.5% for 2028, 3.25% for 2029 and 3% for 2030; reductions below 3% from 2031 are conditional on reserve-fund and revenue tests, and are not published here.
Affected brackets: The single rate above the $10,000 exemption. The first $10,000 of taxable income remains untaxed.
House Bill 1 (2025 Regular Session), amending Miss. Code s 27-7-5. Effective . Source: Mississippi Legislature — House Bill 1 (As Sent to Governor), 2025 Regular Session — amending Section 27-7-5 (retrieved 2026-09-19)
Montana
Montana's top ordinary rate falls from 5.65% to 5.4% and the 4.7% bracket widens substantially — the second and final step of House Bill 337. The long-term capital gains rates stay at 3.0% and 4.1%, but their brackets move to match the new ordinary ranges.
Affected brackets: Both ordinary brackets: the 4.7% band widens from $47,500 to $65,000 (single), $95,000 to $130,000 (married filing jointly) and $71,250 to $97,500 (head of household), and the rate above it falls to 5.4%.
House Bill 337 (2025, 69th Legislature). Effective . Source: Montana Department of Revenue — HB337: 2026-2027 Montana Individual Income Tax Changes (retrieved 2026-09-19)
Nebraska
Nebraska's top two bracket rates fall from 4.55% to 3.99%, completing the reduction schedule set by LB 754 in 2023. Neb. Rev. Stat. s 77-2715.03 states the rates unconditionally by taxable year, with no revenue trigger.
Affected brackets: Rate three and rate four — the top two of Nebraska’s four brackets. The lower two are unchanged.
LB 754 (2023), amending Neb. Rev. Stat. s 77-2715.03. Effective . Source: Nebraska Legislature — Neb. Rev. Stat. s 77-2715.03 — Individual income tax brackets and rates (retrieved 2026-09-19)
Rhode Island
Rhode Island drops the full-retirement-age requirement from its Social Security modification. From 2027 a taxpayer under full retirement age can claim it, provided they still meet the income test — AGI under $80,000 single, head of household or married filing separately, or under $100,000 married filing jointly.
Affected brackets: Not a bracket change. It widens who may subtract Social Security benefits from Rhode Island taxable income.
House Bill 7127 Substitute A, as amended (FY2027 budget), Article 6 s 5, amending R.I. Gen. Laws s 44-30-2.6(c). Effective . Source: Rhode Island Division of Taxation — Summary of Legislative Changes 2026 — Social Security Relief (retrieved 2026-09-19)
Rhode Island creates a refundable Child Tax Credit of $330 per child aged 18 or under, for residents filing a personal income tax return. It phases out above $88,500 AGI for single, head of household, married filing separately and qualifying widow(er) filers, and above $110,640 for married filing jointly, and the credit and thresholds are indexed annually.
Affected brackets: Not a bracket change. A refundable credit against Rhode Island personal income tax.
House Bill 7127 Substitute A, as amended (FY2027 budget). Effective . Source: Rhode Island Division of Taxation — Summary of Legislative Changes 2026 — Child Tax Credit (retrieved 2026-09-19)
Rhode Island permanently decouples from two federal provisions for tax years beginning in 2027: the IRC s 163(j) treatment of depreciation, amortization and depletion deductions, and the amount excluded from income under IRC s 1202 for qualified small business stock. Decoupling from s 1202 means a gain that escapes federal tax is still taxed by Rhode Island.
Affected brackets: Not a bracket change. It widens the Rhode Island income base relative to federal.
House Bill 7127 Substitute A, as amended (FY2027 budget), Article 6 ss 2, 5. Effective . Source: Rhode Island Division of Taxation — Summary of Legislative Changes 2026 — Permanent H.R. 1 Decoupling (retrieved 2026-09-19)
Virginia
Virginia's standard deduction rises for the first time since 2025. Va. Code s 58.1-322.03 sets $9,200 for single individuals and $18,400 for married persons for taxable years beginning on and after 1 January 2027, up from $8,750 and $17,500. Rates and brackets are unchanged.
Affected brackets: Not a bracket change. It lifts the deduction before Virginia’s four-bracket schedule applies, so it reaches every filer who does not itemise.
Va. Code s 58.1-322.03, as amended. Effective . Source: Virginia Legislative Information System — Code of Virginia s 58.1-322.03 — Virginia taxable income; deductions (retrieved 2026-09-19)
Announced, scheduled, or conditional — and therefore not here
These are the jurisdictions people will most often be told are cutting taxes in 2027. Each has a real cut in prospect and none of them meets the enacted-law test yet.
- North CarolinaTrigger not certified
North Carolina's rate would fall from 3.99% to 3.49% for 2027, but only if FY2025-26 General Fund revenue exceeded $33,042,000,000. G.S. 105-153.7(a1) makes the reduction conditional, and NCDOR states only that "Additional rate changes may apply to tax years beginning with 2027 based on certain rate reduction triggers" — it publishes no 2027 rate. Consensus forecasts project the trigger will be met; a projection is not a certification, so nothing is published here.
Session Law 2023-134, G.S. 105-153.7(a1). North Carolina Department of Revenue (retrieved 2026-09-19)
- South CarolinaTrigger not certified
H.4216, signed 30 March 2026, restructured South Carolina's income tax from tax year 2026. Its only 2027 provision is a further cut in the top rate, conditional on the Board of Economic Advisors projecting revenue growth of 5% or more, with the determination due by 15 February 2027. That determination has not been made.
H.4216 (2025-2026 Session), signed 30 March 2026. South Carolina Department of Revenue (retrieved 2026-09-19)
- GeorgiaNo published figure
HB 463, signed 11 May 2026, cut Georgia to a flat 4.99% from 2026 and provides for further annual reductions subject to revenue conditions that can delay them. The Department of Revenue publishes 4.99% for 2026 and no figure for 2027, so no 2027 rate is published here.
HB 463 (2026), amending the HB 1437 reduction schedule. Georgia Department of Revenue (retrieved 2026-09-19)
- ColoradoNot enacted
Colorado's expansion of the pension and annuity subtraction to anyone 55 or over, from tax year 2027, was banked during earlier research as an item to confirm. Both vehicles failed: SB25-136 was postponed indefinitely by the Senate State, Veterans & Military Affairs Committee on 27 February 2025, and HB26-1062 by the House Finance Committee on 9 February 2026. Both are recorded as Lost.
HB26-1062 and SB25-136, both postponed indefinitely. Colorado General Assembly (retrieved 2026-09-19)
- KentuckyNot enacted
Kentucky's rate is 3.5% from 2026. HB 152 of the 2026 Regular Session would have set graduated rates from 2027 and removed the reduction procedure, but it was referred to House Appropriations & Revenue on 14 January 2026 and has not passed. No 2027 change is enacted.
HB 152 (2026 Regular Session), in committee. Kentucky General Assembly (retrieved 2026-09-19)
- OklahomaTrigger not certified
Oklahoma's HB 2764 collapsed six brackets into three and cut the top rate to 4.5% from 2026. Further reductions on the 'path to zero' require a preliminary certification by the State Board of Equalization at its December meeting, the first of which falls in December 2026 and has not taken place. Nothing is published for 2027.
HB 2764 (2025), and HB 4072 (2026). Oklahoma Legislature (retrieved 2026-09-19)
The longer trend
One year is not a trend. Across the six years this site holds a sourced rate series, 21 of 51 jurisdictions cut their top marginal rate, and the median top rate fell. The 2027 changes continue that, they do not start it. See the full history.
What this page does not tell you
Every jurisdiction was checked for individual income tax changes already enacted and taking effect in tax year 2027. A change is published here only where the operative text — a statute, an enrolled bill, or the revenue department's own guidance — states the 2027 figure. Proposals, bills still in committee, ballot measures and trigger-dependent reductions whose trigger has not been certified are withheld and named, with the reason, rather than omitted silently.
Every published change and every withheld item was verified against a primary source, named per record. Where no 2027 change is published for a jurisdiction, the basis is the absence of a 2027 item from that state's own guidance and from legislative records — weaker evidence than an affirmative statement that nothing changes, and it is not claimed as one.
Nine jurisdictions levy no tax on ordinary individual income (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming), so no individual income tax rate change can take effect there in 2027. Washington's capital gains excise tax and New Hampshire's repealed interest and dividends tax are outside this dataset.
Corporate income tax changes are out of scope even where the same bill also amends individual provisions; Missouri's and New Mexico's 2027 changes are corporate and are recorded as such.
The 2027 picture is not final. State legislatures sitting in late 2026 and early 2027 can still enact changes effective for tax year 2027, and several withheld items will become publishable when their triggers are certified.
How we verify this data · Sources · Disclaimer — this is published information, not tax advice.
Showing tax year 2027, the latest in the dataset, last verified . Per-year archives: 2027 · 2026 · 2025. Know of a change we have missed? Tell us.