Tax season is steadily approaching its closing date in April. There has been a lot of attention directed toward taxes and statistics, and WalletHub joined in on the findings.
There are some states that are receiving far more in federal aid than they pay in taxes and the personal-finance website released updated rankings for the most and least federally dependent states for 2023. The extent to which states are economically independent was also a focus in the study.
WalletHub worked to compare the 50 states across three key metrics, which were a return on taxes paid to the federal government, the share of federal jobs and federal funding as a share of state revenue.
States receive federal aid for a number of reasons that could range from natural disaster relief and health crises to funding improvements in transportation, education, healthcare and more. Larger aid packages are received in some states rather than others, though more matters than the dollar amount.
The money flow can be compared to percentages of state’s revenues and what the federal government gets back from taxes on state residents. In this research, it was found that Utah is 2023’s third least federally dependent state.
The Beehive State was ranked 42nd in return on taxes paid to the federal government, 48th in federal funding as a share of state revenue and 13th in share of federal jobs. The two states that top Utah, which scored at 14.96, are New Jersey (8.41) in first place and Washington (14.63) in second.
On the other end of the spectrum, the states that were named the most federally dependent were Alaska in first at 83.18, followed by West Virginia at 76.02 and Mississippi at 71.31. WalletHub also found that blue states are less dependent on federal government, with blue scoring at 30.68% while red states came in at 20.32%.