NC Income Tax Rate 2026: 3.99%, and Every Rate Since 2014

The North Carolina income tax is a flat tax: one rate, 3.99% for 2026, on all of a resident’s North Carolina taxable income. The NC income tax rate for 2026 is the same at every income level and for every filing status. Paychecks are withheld at a little more, 4.09%, and the rate is set by law to fall to 3.49% in 2027.

This guide covers what the 3.99% is applied to, why 4.09% comes out of your pay, every rate since 2014, the cuts already written into law for 2027 to 2033, the 3.5% cap on the November 3, 2026 ballot, and what a lower rate means for a paycheck.

What is the NC income tax rate for 2026?

It is 3.99% for tax year 2026: the income you earn from January 1 to December 31, 2026, which you report on the 2026 return you file next year. The NC Department of Revenue (NCDOR) states it on its Tax Rate Schedules page: “For Taxable Years after 2025, the North Carolina individual income tax rate is 3.99% (0.0399).”

The rate was set by Session Law 2023-134, which took it from 4.25% in 2025 to 3.99% for the years after 2025. The 2026 state budget, Session Law 2026-41, kept 3.99% for 2026 and wrote lower rates into law for the years after it.

Single people, married couples and heads of household all pay the same 3.99%. What differs is the standard deduction taken off before the rate is applied: $12,750 for a single filer, $19,125 for a head of household and $25,500 for a married couple filing jointly (G.S. 105-153.5; G.S. stands for the North Carolina General Statutes). After that, every $1,000 of North Carolina taxable income adds $39.90 of tax, whoever you are.

Why is 4.09% taken out of your paycheck, not 3.99%?

Because NCDOR builds its withholding tables on the NC income tax rate plus 0.1%. Form NC-30, NCDOR’s 2026 guide for employers, says the withholding calculations “are based on the individual income tax rate of 3.99% plus 0.1%. This results in a withholding tax rate of 4.09%.” The rule comes from state law (G.S. 105-163.2), which tells NCDOR to build the tables on the rate in the tax statute plus one-tenth of one percent.

The extra 0.1% is not a second tax. Your return taxes the year’s income at 3.99%, and everything withheld during the year counts toward that bill, so the extra tenth of a point comes back in your refund or lowers what you still owe. The same 4.09% is also the flat rate an employer may use for bonuses and other supplemental pay; the bonus tax calculator works out that method and the other one NC-30 allows.

Withholding is also worked out on less than your full pay. For each paycheck, payroll first takes off a share of the standard deduction ($12,750 a year for single and married workers alike, $19,125 for a head of household) and $2,500 a year for each allowance on your NC-4, then multiplies what is left by 4.09% and rounds to the whole dollar (Form NC-30). Employers may use NCDOR’s wage-bracket tables instead of the formula, and the two can come out a dollar apart on some checks.

What income does the 3.99% apply to?

The NC income tax rate applies to your North Carolina taxable income, which starts from your federal adjusted gross income (AGI): the income figure your federal return works out before the standard or itemized deduction. State law defines North Carolina taxable income as “the taxpayer’s adjusted gross income as modified in G.S. 105-153.5 and G.S. 105-153.6” (G.S. 105-153.4). From AGI you add or take off North Carolina’s own items, such as the deduction for Social Security benefits, then take off the NC standard deduction or your NC itemized deductions, and the child deduction if you have children under 17.

• Standard deduction (G.S. 105-153.5): $12,750 single; $19,125 head of household; $25,500 married filing jointly or surviving spouse; $12,750 married filing separately, or $0 if your spouse itemizes (NCDOR’s 2025 return instructions).
• Child deduction: for each child under 17 for whom you get the federal child tax credit, $3,000 at the lowest incomes, falling by $500 a step to $0 once federal AGI is over $140,000 for a married couple filing jointly, $105,000 for a head of household or $70,000 for a single filer (G.S. 105-153.5). The full table is in the NC-4 guide.
• Itemized deductions, if they are larger than the standard deduction: mortgage interest and real estate property tax (together no more than $20,000, and a married couple shares one $20,000 limit), charitable contributions, medical and dental expenses as allowed federally, and repayment of income taxed in an earlier year. The 2026 budget added gambling losses from tax year 2025 on (Session Law 2026-41); the General Assembly’s online text of G.S. 105-153.5 did not show that line yet on October 29, 2026.

North Carolina has no extra standard deduction for being 65 or older or blind (2025 instructions), and its standard deduction did not grow when the federal one did. NCDOR’s answer to that question: “The North Carolina standard deduction amount can only increase if the General Assembly enacts legislation to increase the amount” (NCDOR questions and answers on federal law).

If you live in another state and work in North Carolina, the same rate applies to your wages for work done here. NC-30 says a nonresident employee “is subject to North Carolina withholding on any part of their wages paid for performing services in this State. Any relief from double withholding must be granted by the employee’s state of residence” (Form NC-30, NCDOR withholding questions). On the return, a nonresident pays North Carolina tax only on the North Carolina share of their income (G.S. 105-153.4).

Then the rate does its work: North Carolina taxable income × 3.99% is your tax for 2026, before credits and before what was withheld. The NC income tax calculator runs these steps with your own numbers and shows the refund or the amount still owed.

North Carolina income tax rates since 2014

North Carolina has had one flat rate every year since 2014, and that rate has been cut eight times, from 5.8% in 2014 to 3.99% in 2026. The table lists each year with the law that set it, from 2014 to the scheduled rates through 2033, and you can download it as a CSV file; the chart draws the same numbers.

Download this table (CSV, opens in Excel)

Sources: Session Law 2013-316, NCGA; Session Law 2015-241, NCGA; Session Law 2017-57, NCGA; Session Law 2021-180, NCGA; Session Law 2023-134, NCGA; Session Law 2026-41 (Current Operations Appropriations Act of 2026), NCGA. Checked October 29, 2026.

Set and past 2026 Scheduled by law

• 2014: 5.8%, set by Session Law 2013-316, which also set 5.75% for 2015 and 2016.
• 2017 and 2018: 5.499%, from Session Law 2015-241.
• 2019, 2020 and 2021: 5.25%, from Session Law 2017-57.
• 2022: 4.99%, and 2023: 4.75%, from Session Law 2021-180.
• 2024: 4.5%, and 2025: 4.25%, from Session Law 2023-134, which sped up the cuts: the 2021 law had set 4.6% for 2024 and 4.5% for 2025.
• 2026: 3.99%, from the same 2023 law, kept by the 2026 budget.

If you are filing or fixing a return for an earlier year, use that year’s rate. NCDOR’s 2025 instructions, for example, say: “For tax year 2025, the individual income tax rate is 4.25%.”

What will the NC income tax rate be in 2027 and later?

The NC income tax rate is set to be 3.49% for 2027, 2028 and 2029, 3.24% for 2030, 2031 and 2032, and 2.99% for every year after 2032. These rates were fixed by the 2026 state budget, Session Law 2026-41, which Governor Josh Stein signed on July 7, 2026, and they do not depend on how much the state collects. The General Assembly’s fiscal note on the budget says: “These rate reductions are not conditional on revenue triggers.”

From 2035 the rate can fall further, but only if revenue grows. The law lists a General Fund revenue amount for each fiscal year from 2033-34 to 2038-39, starting at $40,258,000,000 for 2033-34, and pairs each one with a tax year from 2035 to 2040. When revenue passes the amount, the rate for the paired tax year drops by a quarter point (0.25%), but never below 2.49%. The fiscal note describes this as “up to two future rate reductions between 2035 and 2040” and says the rate “could fall to a terminal rate of 2.49% by as early as 2036 or as late as 2040.”

This replaced a different plan. Under Session Law 2023-134, every cut after 2026 depended on revenue triggers of half a point each, and the fiscal note says the rate had been projected to reach 2.99% in 2028. The 2026 budget swapped those triggers for a fixed schedule: 3.49% for 2027 is now certain, but 2028 and 2029 stay at 3.49% as well.

Two state web pages had not caught up as of October 29, 2026. The General Assembly’s online text of G.S. 105-153.7, the section that sets the rate, still showed the 2023 wording (“After 2025 3.99%” and the half-point triggers), and NCDOR’s Tax Rate Schedules page still said changes from 2027 depend on triggers under Session Law 2023-134. The law in force is section 44.1 of Session Law 2026-41. NCDOR had also not published its 2027 withholding tables by that date; its current Form NC-30 is the 2026 edition. If the 2027 tables keep the same formula, the rate plus 0.1%, withholding in 2027 would be 3.59%.

What is the 3.5% cap on the November 3, 2026 ballot?

It is a proposed change to the North Carolina Constitution that would cap the state income tax rate at 3.5%, down from today’s cap of 7%, from tax year 2027, if voters approve it on November 3, 2026. The General Assembly put it on the ballot with Session Law 2026-4 (Senate Bill 1080). The question reads: “Constitutional amendment to keep the State income tax rate from being raised higher than three and one-half percent (3.5%).”

It would not change any rate already scheduled. The rates set for 2027 and later are all 3.49% or lower, so they sit under the cap either way. The amendment would only stop a future law from raising the rate above 3.5%. The result will be known after the vote.

Is there a city or county income tax in North Carolina?

No. State law forbids it: “No city, town, township, or county shall levy any tax on income or inheritance” (G.S. 105-247). Whether you live or work in Charlotte, Raleigh, Durham, Greensboro or a rural county, the income taxes on your pay are federal income tax and North Carolina’s 3.99%, nothing more. A paycheck calculator that asks for your ZIP code will give the same North Carolina answer anywhere in the state.

Does North Carolina tax Social Security?

No. Any Social Security included in your federal AGI is deducted in full on the North Carolina return, and so are Railroad Retirement benefits (G.S. 105-153.5). NCDOR’s 2025 instructions put it plainly: “Social Security and railroad retirement benefits are not subject to state income tax.”

Some other retirement income can be deducted too: military retirement pay for members who served at least 20 years or were medically retired under 10 U.S.C. Chapter 61, Survivor Benefit Plan payments, and government pensions of retirees who were vested by August 12, 1989, under the Bailey, Emory and Patton cases (G.S. 105-153.5; the date is in NCDOR’s 2025 instructions).

Do the federal deductions for tips, overtime and seniors lower NC tax?

No. The federal deductions for tips, overtime pay, car-loan interest and seniors, created by Public Law 119-21 for 2025 to 2028, do not lower North Carolina taxable income. For tax year 2025, NCDOR’s questions and answers on federal law say these deductions “are taken after a taxpayer calculates AGI and therefore do not affect North Carolina taxable income. The General Assembly must enact legislation to allow taxpayers to reduce AGI for similar adjustments.”

For 2026, NCDOR has not yet said so in as many words; it says its guidance will come with the 2026 return instructions. Nothing enacted points the other way. In July 2026, Session Law 2026-31 moved North Carolina’s reference to the federal tax code forward to July 5, 2025, but these deductions still come after AGI, where North Carolina starts, and neither 2026 tax law creates a state version of them. The overtime pay guide explains the federal overtime deduction and how to claim it.

What does a lower rate mean for your paycheck?

Each cut in the North Carolina income tax rate takes a little off the state line of every paycheck. Because the state tax is a flat percentage, a half-point cut, like the step from 3.99% in 2026 to 3.49% in 2027, means $5 less tax a year for each $1,000 of North Carolina taxable income. Here is a 2026 paycheck, taxed at 3.99% and withheld at 4.09%, worked out by this site’s rules:

Example: a salary of $60,000 a year, paid every two weeks, single on the W-4 and NC-4, no other entries. Each check: gross pay $2,307.69, federal income tax $193.08, Social Security $143.08, Medicare $33.46, North Carolina income tax $74.00. Take-home pay: $1,864.07 (80.8% of gross), $48,465.82 for the year.

The drawing below shows the same paycheck as a pay stub, with each tax on its own line.

Earnings statement 2026

$60,000 a year, paid every two weeks, single

• Gross pay$2,307.69
• Federal income tax−$193.08
• Social Security−$143.08
• Medicare−$33.46
• NC income tax−$74.00

Take-home pay$1,864.07

To see your own pay, change the salary, the pay schedule or the W-4 and NC-4 entries in the calculator below. It uses the 2026 rates.

How you are paid

SalaryBy the hour

Salary before tax

$

That amount is

A yearEach paycheck

Hourly rate

$

Hours a week

Overtime: time and a half for hours over 40 in a weekUntick if you are not paid overtime.

How often you are paid

Weekly (52 paychecks a year)Every two weeks (26 paychecks a year)Twice a month (24 paychecks a year)Monthly (12 paychecks a year)

Filing status on your W-4

Singleor married filing separatelyMarriedfiling jointlyHead of household

Federal Form W-4: the other steps dependents, two jobs, extra

Step 2: I have two jobs at once, or I am married filing jointly and my spouse worksThe box in Step 2(c) is checked.

Children under 17 Step 3

Other dependents Step 3

Step 3 is $2,200 for each child under 17 and $500 for each other dependent, if your income is $200,000 or less ($400,000 married filing jointly).

Other income Step 4(a), a year

$

Deductions Step 4(b), a year

$

Extra withholding Step 4(c), each paycheck

$

Which Form W-4 is your employer using?

2020 or laterthe one with Steps 1–52019 or earlierwith allowances

Allowances on that old W-4

Each takes $4,300 a year off the pay that is taxed (Publication 15-T). Steps 2, 3, 4(a) and 4(b) above are not used; the extra withholding is (line 6 of the old form).

Married on that old W-4Withholding uses the married table.

North Carolina Form NC-4 allowances, extra

Filing status on your NC-4

Singleor married filing separatelyMarriedfiling jointly, or surviving spouseHead of household

Allowances NC-4 line 1

Each allowance takes $2,500 a year off the pay NC withholding is worked on (Form NC-30).

Extra NC withholding NC-4 line 2, each paycheck

$

Deductions from your pay 401(k), health insurance

401(k), 403(b) or 457(b) before tax

Counted as

% of each paycheck$ each paycheck

Health, dental and vision insurance before tax, each paycheck

$

HSA or FSA through a cafeteria plan before tax, each paycheck

$

An HSA paid by plain payroll deduction, outside a cafeteria plan, is taxed like pay: put it under after-tax deductions.

After-tax deductions each paycheck

$

A Roth 401(k), union dues, a wage garnishment: anything taken after tax.

Pay so far this year for high earners

Social Security and Medicare pay so far this year before this paycheck

$

On a pay stub, the year-to-date Social Security or Medicare wages: your gross pay so far less any health insurance or HSA taken before tax. It matters only above $184,500, where Social Security stops, and above $200,000, where 0.9% more Medicare starts. It changes this paycheck only; the year column counts a year of these paychecks from January.

Work it outThe answer changes as you type.

Earnings statement

Paid every two weeks · 2026

Your paycheck: this check and the whole year

Item	This check	Year
Gross pay	$2,307.69	$59,999.94
Federal income taxForm W-4	$193.08	$5,020.08
Social Security6.2% up to $184,500	$143.08	$3,720.08
Medicare1.45%, and 0.9% more above $200,000	$33.46	$869.96
North Carolina income taxForm NC-4, withheld at 4.09%	$74.00	$1,924.00

Take-home pay

$1,864.07

One thousand eight hundred sixty-four and 07/100 dollars

For the year: $48,465.82. Taxes take 19.2% of your gross pay.

Where each dollar of this check goes

• Take-home pay (80.8%)$1,864.07
• Federal income tax (8.4%)$193.08
• Social Security (6.2%)$143.08
• Medicare (1.4%)$33.46
• NC income tax (3.2%)$74.00

How this was worked out, line by line

Federal income tax: IRS Publication 15-T, Worksheet 1A

1. 1a. Pay on this check that federal income tax is worked on: $2,307.69
2. 1b. Pay periods a year: 26
3. 1c. 1a × 1b: $59,999.94
4. 1d. Other income a year (W-4 Step 4(a)): $0.00
5. 1e. 1c + 1d: $59,999.94
6. 1f. Deductions a year (W-4 Step 4(b)): $0.00
7. 1g. Step 2 box not checked: $8,600.00
8. 1h. 1f + 1g: $8,600.00
9. 1i. Adjusted Annual Wage Amount (1e − 1h): $51,399.94
10. 2b–2d. The row of the annual table it falls in: from $19,900.00, $1,240.00 plus 12% of the rest
11. 2e. The rest: $51,399.94 − $19,900.00 = $31,499.94
12. 2f. 12% of 2e: $3,779.99
13. 2g. 2c + 2f: $5,019.99
14. 2h. 2g ÷ 26: $193.08
15. 3a. Credits for dependents (W-4 Step 3): $0.00
16. 3b. 3a ÷ 26: $0.00
17. 3c. 2h − 3b (not below zero): $193.08
18. 4a. Extra withholding (W-4 Step 4(c)): $0.00
19. 4b. Federal income tax on this check (3c + 4a): $193.08

North Carolina income tax: Form NC-30, annualized method

1. 1. Pay on this check that NC income tax is worked on: $2,307.69
2. 2. Pay periods a year: 26
3. 3. Annualized pay (1 × 2): $59,999.94
4. 4. N.C. standard deduction in NC-30: $12,750.00
5. 5. NC-4 allowances: 0 × $2,500.00 = $0.00
6. 6. 4 + 5: $12,750.00
7. 7. Net annualized pay (3 − 6, not below zero): $47,249.94
8. 8. 4.09% of 7 (the 3.99% tax rate plus 0.1%): $1,932.52
9. 10. 8 ÷ 26, to the nearest whole dollar: $74.00

Social Security and Medicare

1. Social Security: 6.2% of $2,307.69 = $143.08
2. Medicare: 1.45% of $2,307.69 = $33.46

Sources: Publication 15-T (2026), Federal Income Tax Withholding Methods, IRS; Form W-4 (2026), Employee's Withholding Certificate, IRS; Publication 15 (2026), (Circular E), Employer's Tax Guide, IRS; Form NC-30, Income Tax Withholding Tables and Instructions for Employers (2026), NCDOR; Form NC-4, Employee's Withholding Allowance Certificate, NCDOR. Checked October 29, 2026.

Take-home pay $1,864.07 every two weeks from $2,307.69 gross: federal income tax $193.08, Social Security $143.08, Medicare $33.46, North Carolina income tax $74.00.

For the year as a whole, the NC income tax calculator shows your 2026 North Carolina tax at 3.99% and whether your withholding covers it, and the take-home pay table lists paychecks for salaries from $20,000 to $300,000.

The rates on this page come from North Carolina’s session laws and statutes, the General Assembly’s fiscal note on the 2026 budget, and NCDOR’s Form NC-30 and Tax Rate Schedules, each linked where it is used. Figures checked October 29, 2026. The worked paycheck is an estimate made the way how the calculators work describes. This page is general information, not tax or legal advice.

Questions people ask

Does North Carolina have state income tax brackets?

No. North Carolina taxes all North Carolina taxable income at one flat rate, 3.99% for 2026, so there are no brackets to move into as your income rises (NCDOR Tax Rate Schedules).

Because the standard deduction comes off first, the share of your total income that goes to state tax is a little under 3.99%.

Is the NC income tax rate different for married filing jointly?

No. A married couple filing jointly pays the same 3.99% rate for 2026 as a single person. What differs is the standard deduction, $25,500 for the couple against $12,750 for a single filer, and the income bands of the child deduction (G.S. 105-153.5).

What is the North Carolina income tax rate for 2027?

The scheduled rate for 2027 is 3.49%, fixed by the 2026 state budget, Session Law 2026-41, for 2027, 2028 and 2029. It does not depend on state revenue.

NCDOR had not yet updated its rate page or published 2027 withholding tables on October 29, 2026.

What was the North Carolina income tax rate in 2025?

It was 4.25%. NCDOR’s 2025 return instructions say: “For tax year 2025, the individual income tax rate is 4.25%.” Use that rate when you file or amend a 2025 return.

Will the 3.5% cap on the November 2026 ballot change my tax rate?

No. The constitutional amendment on the November 3, 2026 ballot would cap North Carolina’s income tax rate at 3.5% from tax year 2027, and every rate already scheduled is 3.49% or lower, so none of them changes either way (Session Law 2026-4, Session Law 2026-41).

If voters approve it, it would only stop a future law from raising the rate above 3.5%.

Is North Carolina’s income tax rate 3.99% or 4.09%?

North Carolina’s income tax rate for 2026 is 3.99%; 4.09% is the rate employers use to withhold it from paychecks, which is the tax rate plus 0.1% (NCDOR Tax Rate Schedules, Form NC-30).

Your return taxes your income at 3.99%, so the extra withheld during the year counts toward your bill and comes back in a refund or lowers what you still owe.

Updated October 29, 2026