How North Carolina taxes a paycheck
North Carolina has had a flat tax since 2014, when it replaced a three-bracket schedule topping out at 7.75% with 5.8%. The 2021 budget set a path to 3.99% by 2027, and the 2023 budget accelerated it: 4.5% in 2024, 4.25% in 2025 and 3.99% for 2026. Beyond that, the rate can fall to 3.49% in 2027 and eventually 2.49% if general fund revenue exceeds targets set in the budget.
The standard deduction is $12,750 single and $25,500 married, and there is no personal exemption; a child deduction of up to $3,000 per child, phasing down with income, is claimed on the return. North Carolina has no local income taxes; Charlotte, Raleigh and every county rely on property and sales tax.
How much taxes are taken out of paychecks in North Carolina?
On a $60,000 salary in 2026, a single filer in North Carolina pays about $5,020 in federal income tax, $4,590 in Social Security and Medicare, and about $1,890 in North Carolina income tax, leaving roughly $48,510 a year or $1,866 every two weeks. The state share is 3.1% of gross, and the 2026 cut is worth about $120 a year on that salary.
At $150,000 the tax is about $5,480, an effective rate of 3.7%. A married couple on $100,000 pays about $2,970.
North Carolina compared with its neighbours
North Carolina borders Tennessee, which taxes no wages, and Virginia, South Carolina and Georgia. On a $60,000 single salary the state tax is about $1,890 in North Carolina, $2,640 in Virginia, $2,440 in South Carolina and $2,490 in Georgia. North Carolina is the cheapest of the four by a clear margin.
That was not true a decade ago, when North Carolina's rate was higher than Virginia's. The Charlotte metro reaches into South Carolina's York County, and a $60,000 earner on the North Carolina side now pays about $550 less state tax than one across the line.
Withholding forms and filing status in North Carolina
North Carolina employers withhold from Form NC-4, which asks for filing status and allowances; the tables apply the flat rate after the standard deduction. Married couples filing jointly get a $25,500 deduction, double the single figure, and the same 3.99% rate, so a one-earner couple on $60,000 pays about $1,380 against a single filer's $1,890. The child deduction, up to $3,000 per child, is claimed on the return.
North Carolina has no reciprocal agreements. South Carolina, Virginia and Georgia residents working in North Carolina pay North Carolina tax on those wages and credit it at home; North Carolina residents working in Tennessee owe North Carolina tax with no credit. The scheduled cut to 3.49% for 2027 depends on general fund revenue meeting the trigger in the state budget.