Taxes in Delaware


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Delaware - State

Everyday purchases in Delaware are tax free, which helps residents save more money. Below, we explain various Delaware state taxes affecting retirement income, such as sales tax, inheritance tax, and property taxes.

For information regarding taxes in other states, see Retirement Taxes by State.

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Delaware Tax Rates

State Sales Tax0%
Avg State/Local Sales Tax0%
Gas Tax$0.23 per gallon
Diesel Tax$0.22 per gallon
Cigarette Tax$2.10 per pack
Income Tax6.60%
Effective Tax Rate:6.31%
Property Tax0.57%
Social Security TaxNone
Medical/Dental Deduction:None
Federal Income Tax Deduction:None
Retirement TaxPartial
State Taxes in Delaware

Delaware State Taxes Explained

Delaware Sales Tax

Delaware does not impose a state or local sales tax.

Delaware Income Taxes

State income tax brackets range from 2.2% (taxable income from $2,001 to $5,000) to 6.6% (taxable income above $60,000). Wilmington also levies a fee on wages.

Delaware Property Taxes

The state of Delaware imposes no property tax. Local municipalities levy property tax at an effective rate of 0.57%. The median home value in Delaware is $251,100, which equates to $1,431 in annual property taxes.

Delaware residents age 65 and older may use the School Property Tax Credit to offset 50% of those local taxes. The credit must be used to reduce property taxes by up to $400 on the primary residence. Those who moved to Delaware after January 1, 2018, are not eligible for the credit until they live in the state for 10 consecutive years.

Delaware Retirement Taxes

Social Security is tax exempt in Delaware. Taxpayers who are at least 60 years of age can exclude $12,500 of retirement income. This income can come from 401(k) plans, pensions and other retirement accounts as dividends, capital gains or interest. Retirees who are landlords must also count net rental income from real property. Retired taxpayers under the age of 60 are entitled to a $2,000 exclusion.

Retired military pay follows the same rules that apply to other types of retirement income. $12,500 of military retirement benefits are excluded from income tax if the taxpayer is 60 or older. Younger retirees can exclude $2,000

Delaware Estate and Inheritance Taxes

Delaware does not impose an estate or inheritance tax.

For information on Delaware taxes, visit the Delaware Division of Revenue.

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