Kansas State Tax
Kansas State Tax: An Overview
In the United States, each state has its own system of taxation. In Kansas, the state tax system is essential for funding different services such as education, healthcare, and infrastructure. The Kansas Department of Revenue is responsible for administrating the state tax laws, and it collects revenue from different sources, such as income, sales, property, and other taxes.
Kansas has a unique position in the United States when it comes to taxation. It has one of the highest state sales tax rates, while its individual income tax rates are relatively low compared to other states. But how does the Kansas state tax system work, and what are the different kinds of taxes that Kansas residents have to pay? This article will provide an overview of the Kansas state tax, including updates on recent changes to the system.
Income Tax
The Kansas income tax is a progressive tax system based on a taxpayer's income level. The state income tax rate varies from 3.1% to 5.7% based on the income level. For lower-income earners, the tax rate is 3.1%, while higher-income earners will face the highest tax rate of 5.7%. The income tax in Kansas is relatively lower than many other states, and it has been attractive to businesses and residents seeking lower tax rates.
However, in recent years, there have been changes to the Kansas state income tax system. In 2012, Governor Sam Brownback signed into law a bill that reduced income tax rates for all taxpayers. The new law eliminated income taxes for some businesses that pass their income through to their owners, and it reduced individual income tax rates in 2013 and 2014. The goal was to create a business-friendly and attractive tax system to spur economic growth in the state.
However, the effects of the tax cut were not as beneficial as anticipated, and the state faced a significant budget shortfall. In response, in 2017, the Kansas legislature increased the income tax rate and the number of tax brackets. The income tax rates range from 3.1% to 5.7%, depending on the income level in 2021.
📝 See Also
Sales Tax
Kansas has one of the highest state sales tax rates in the country at 6.5%. This rate includes both state and local sales taxes. Additionally, there are some exemptions and exclusions on sales tax, such as groceries, prescription drugs, and certain types of equipment used in manufacturing.
In recent years, Kansas has expanded its sales tax base to include some services. For example, car and truck repair services, storage services, and pet care services are now subject to sales tax. This expansion has been a source of debate among policymakers and residents, with some concerned about the impact on businesses and consumers.
Property Tax
Property taxes are based on the value of real estate property and are assessed at the county level in Kansas. Each county determines the assessed value of the property, multiplied by the tax rate set by the county and other taxing districts where the property is located. The property tax is used primarily for funding local government services such as schools, fire departments, and police departments.
In Kansas, property taxes are relatively low compared to other states. The median property tax in the state is $1,625 per year, which is lower than the national median property tax of $2,578. However, rising property values can lead to higher property taxes for homeowners. In addition, the 2019 Kansas legislative session included a property tax lid law, which places a limit on the amount of revenue that local taxing units can generate annually.
Other Taxes
Kansas also collects revenue from various other taxes, including cigarette and tobacco taxes, state excise taxes, and severance taxes. These taxes are used primarily for funding different services, such as education, healthcare, and environmental protection.
Cigarette and Tobacco Taxes: Kansas has a tax of $1.29 per pack of cigarettes, which is the 22nd highest in the country. In addition, cigars and other tobacco products have a tax rate of 10% of the wholesale price.
State Excise Taxes: Kansas has a variety of excise taxes that are paid by businesses. These taxes are based on the goods and services provided, such as alcohol, gasoline, and diesel fuel.
Severance Taxes: Severance taxes are paid by companies that extract or produce certain natural resources in Kansas, such as oil, gas, and coal. The revenue from these taxes is used to fund conservation efforts and other environmental protection programs.
Conclusion
The Kansas state tax system is essential for funding different services in the state, such as education, healthcare, and infrastructure. The system includes income, sales, property, and other taxes. Kansas has a relatively low income tax rate, but one of the highest state sales tax rates in the country. The property tax is also relatively low compared to other states, but rising property values can lead to higher taxes for homeowners. There have been several changes to the Kansas state tax system in recent years, including changes to income tax rates, sales tax base, and property tax lids. These changes have been a source of debate among policymakers and residents, and the future of the system remains uncertain.
Kansas State Tax
There are a number of taxes applicable to the state of Kansas, which includes sales tax and three income brackets for personal income taxation. Kansas state taxation is slightly below the national average and taxpayers pay roughly $3,911 in taxes per capita.
Kansas state sales tax – 6.3%, food and drugs exempt.
Kansas state personal income tax
- Three income brackets for single filings
o 3.5% for income below $15,000
o 6.25% for income between $15,000 and $30,000 (over 30k for couples)
o 6.45% for income over $30,000 (over 60k for couples)
- Tax returns are due on March 15, percentage penalties for late filings, up to 50% for a year delay
Kansas state excise taxes
Taxes assessed on vehicles, alcohol, tobacco, gasoline and are in addition to federal excise taxes.
- $.79 per package of 20, $.99 tax on cigarette packages of 25
- $2.50 tax per gallon of liquor
- $.18 on strong beer, $.30 on light wine, $.75 on fortified wine.
- $.24 a gallon on gasoline , $.26 on diesel
Kansas State marijuana taxes
- Processed - $3.50/gram
- Wet Plant - $.40/gram
- Dry Plant - $.90/gram
Only drug dealers pay these taxes. Anyone that produces, ships transports or imports 28 grams of marijuana in Kansas is a drug dealer.
Kansas inheritance tax
The current Kansas state ax on estates stands at .5% - 3% with an exemption of $1,000,000. Estates exceeding the exemption must file Form K-706 within 9 months of the death of the individual.
Kansas payroll taxes
State Disability Insurance – none
State Unemployment Insurance - .11% to 7.4%, wage base is $8,000. Employer contribution is 6% for construction, 4% for all others.
Exemptions
- Single - $2,250
- Married - $4,5000
- Dependents -$2,250
Military, civil service, state and local government in-state pensions are exempt. No state states on Social Security benefits for individuals making less than $75,000. VA benefits not taxed.
Corporate income tax - 4% plus 3.05% surcharge on income over $50,000 and 3% surcharge for income under $50,000.
Misc
Social Security, railroad retirement and life insurance benefits are not taxed under Kansas law. Gaming winnings from the lottery, casinos or horse racing are taxed.
Military personnel are taxed by federal income tax rules unless receiving some income in Kansas. Military income then factors into that tax determination.
Property tax is assessed at fair market value, apprised and tax collected at the county level. At least half of property taxes are due Dec 20 with tax assessments being sent around November.
Intangible tax returns must be filed for income exceeding $5 income on savings accounts, stocks, bonds and other financial tools. This form discloses the income and the bill is sent and assessed once the form is filed.