North Carolina has a flat 4.25% state income tax rate, making it relatively affordable compared to many other states. Our free North Carolina paycheck calculator shows your exact take-home pay after federal taxes, NC state tax, and FICA deductions. Whether you're planning a move to the Tar Heel State, comparing job offers, or budgeting your current NC salary, get accurate results based on 2025 tax rates.
North Carolina Tax System Overview
North Carolina uses a flat income tax system, which means all residents pay the same percentage regardless of income level. Key features include:
- Flat State Tax Rate: 4.25% on all income levels
- Standard Deduction: $12,750 (single), $25,500 (married filing jointly)
- No Local Income Tax: Cities and counties cannot impose income taxes
- Tax-Friendly for Retirees: Retirement income generally not taxed
Sample North Carolina Paycheck Calculations
Here's how much you'll take home at different salary levels in North Carolina:
$55,000 Annual Salary
- Gross Pay: $55,000
- Federal Tax: $5,379
- NC State Tax: $2,338
- FICA Taxes: $4,208
- Take-Home Pay: $43,075 (78.3%)
- Monthly Net: $3,590
- Bi-weekly Net: $1,657
$75,000 Annual Salary
- Gross Pay: $75,000
- Federal Tax: $8,739
- NC State Tax: $3,188
- FICA Taxes: $5,738
- Take-Home Pay: $57,335 (76.4%)
- Monthly Net: $4,778
- Bi-weekly Net: $2,205
$100,000 Annual Salary
- Gross Pay: $100,000
- Federal Tax: $14,260
- NC State Tax: $4,250
- FICA Taxes: $7,650
- Take-Home Pay: $73,840 (73.8%)
- Monthly Net: $6,153
- Bi-weekly Net: $2,840
North Carolina vs. Neighboring States
Compare North Carolina's tax burden with surrounding states:
North Carolina ($75k salary)
- Take-home: $57,335
- Effective rate: 23.6%
- State tax: $3,188
- Moderate tax burden
South Carolina ($75k salary)
- Take-home: $58,693
- Effective rate: 21.7%
- State tax: $1,830
- SC Saves: $1,358/year
Understanding North Carolina Paycheck Deductions
North Carolina State Income Tax
North Carolina's flat 4.25% tax applies after the standard deduction:
- Flat Rate: 4.25% on income after standard deduction
- Standard Deduction: $12,750 (single), $25,500 (married filing jointly)
- No Personal Exemption: NC eliminated personal exemptions in recent tax reform
- Simple Filing: Flat rate makes tax calculations straightforward
North Carolina Retirement Tax Benefits
North Carolina is very retirement-friendly:
- Retirement Income Exempt: Most retirement income is not subject to state tax
- 401(k) & IRA Withdrawals: Generally not taxed by North Carolina
- Pension Income: Most pension income is exempt from state taxes
- Social Security: Not taxed by North Carolina
- Military Retirement: Military retirement pay is fully exempt
North Carolina Economic Advantages
Beyond state taxes, North Carolina offers several economic benefits:
- No Local Income Tax: Cities and counties cannot impose income taxes
- Research Triangle: Major technology and research hub
- Banking Center: Charlotte is a major financial services center
- Lower Cost of Living: Generally more affordable than northeastern states
- Business-Friendly: Favorable corporate tax environment
Charlotte vs. Rest of North Carolina
Tax considerations remain the same statewide, but living costs vary:
Charlotte Metro
- State tax: 4.25%
- Cost of living: Higher
- Job market: Financial services
- Housing: More expensive
Rural North Carolina
- State tax: 4.25%
- Cost of living: Lower
- Job market: Manufacturing/Agriculture
- Housing: More affordable
Frequently Asked Questions
Is North Carolina tax-friendly for retirees?
Yes, North Carolina is very retirement-friendly. Most retirement income including Social Security, pensions, 401(k) withdrawals, and IRA distributions are not subject to state income tax.
Are there local income taxes in North Carolina?
No, North Carolina law prohibits local governments from imposing income taxes. This keeps the tax system simple and ensures the 4.25% state rate is your only income tax burden.
How does NC's 4.25% rate compare to other states?
North Carolina's flat 4.25% rate is competitive, especially when combined with its generous standard deduction and exemption of retirement income. It's lower than many northeastern states but higher than states with no income tax.
Can I deduct federal taxes paid on my NC return?
No, North Carolina does not allow deduction of federal income taxes paid. However, the flat rate and standard deduction help keep your overall tax burden reasonable.
Tax Planning Tips for North Carolina Residents
Maximize Retirement Savings
Since North Carolina doesn't tax most retirement income, contributing to 401(k)s and IRAs provides immediate tax savings and tax-free growth.
Consider Timing of Retirement
North Carolina's retirement-friendly tax environment makes it attractive for retirees, especially those moving from higher-tax states.
Take Advantage of Standard Deduction
With North Carolina's substantial standard deduction, many taxpayers won't need to itemize, simplifying tax filing.
Plan for Property Taxes
While income taxes are moderate, factor in property taxes when choosing where to live in North Carolina, as rates vary by county.
Ready to Calculate Your North Carolina Take-Home Pay?
Use our calculator above to see exactly how much you'll keep from your paycheck in North Carolina.