In 2023, the federal government collected around $4.67 trillion from states and their residents through taxes on individuals and businesses and redistributed about $4.56 trillion back to states and residents through programs like Social Security, Medicaid, Medicare, food stamps, and education grants.
The balance varies by state: New Yorkers paid about $89 billion more to the federal government than they received, while Virginians received about $79 billion more than they paid.
That amounts to a differential of $105 billion, or about $314 per person, in favor of the federal government. It’s a relatively small amount at the national level, but a different picture at the state level, where some states contribute or receive much more than others.
How do states and individuals generate revenue for the federal government?
In short, taxes. In 2023, 88% of tax revenues came from individual income and payroll taxes. Another 10% came from business income taxes and the rest from estate, excise, and gift taxes.
Which states generate the most and least revenue for the federal government?
Of the $4.67 trillion in revenue from the states in 2023, over 35% came from the nation’s four most populous states: California (12.2% of the total), Texas (8.9%), New York (8.0%), and Florida (6.7%). On average, states contributed almost $14,000 per resident to federal coffers.
Some less-populated states generated more than their populations would suggest. Delaware, where some of the nation’s highest rates of business creation leads to the highest share of revenue coming from business income taxes, sent $24,575 per person to the federal government. Delaware was followed by Massachusetts ($21,747) and Minnesota ($20,728), whose high median incomes mean they send more in individual taxes to the federal government than any other states. Washington, DC, sent more than double the highest-paying state, at $54,612.
The federal government collected the least revenue per person from West Virginia ($4,867), Mississippi ($5,148), and New Mexico ($5,882).
How does government revenue get distributed to states and local communities?
Federal revenues are redistributed to states and the people living in them in myriad ways, some more direct than others.
Out of the $6.2 trillion overall spent by the federal government in 2023, $1.1 trillion went to states and local governments to support Medicaid ($607 billion), food stamps ($119 billion), transportation ($85.8 billion), and education ($50.0 billion).
Another $1.6 trillion was dispersed directly to individuals, mostly through federal programs like Social Security ($1.4 trillion) and veterans’ benefits ($182 billion).
Still more went to businesses via government contracts, schools and colleges for programs including Pell Grants and Head Start, and other nonprofits and institutions.
While food stamps, for instance, may be a more direct form of investment in a population than, say, business contracting, this analysis includes a broad variety of attributable spending to provide as comprehensive a view as possible.
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Which states receive the most and least from the federal government?
The most populous states generate a big chunk of federal revenue and get the most back. Thirty-one percent of federal money disbursed to states and their residents in 2023 went to the four most populous states: California (10.8% of all disbursements), Texas (7.6%), Florida (6.4%), and New York (6.2%).
Controlling for population, Alaska and its residents received the most money per person, at $24,141, about a quarter of which came from funding agreements between the Indian Health Service and tribes in the state. Alaska was followed by Virginia ($22,085 per person) and New Mexico ($19,720). Washington, DC, again posts higher numbers than any state, getting $74,361 per person. More than a third of this came from contracts and grants from the Department of Transportation — including Amtrak funding — and Department of Defense funding for the military branches operating in the district.
Which states send more to the federal government than they receive?
In terms of net contributions, 19 states sent more to the federal government than they received in 2023. The largest gaps were in New York ($89 billion), California ($78 billion), and New Jersey ($70 billion).
On a per-person basis, Delaware ($10,505), Minnesota ($7,605), and New Jersey ($7,456) contributed the highest net total.
Which states receive more from the federal government than they send?
The other 31 states and Washington, DC, received more than they sent, with the largest gaps in Virginia ($79 billion), Alabama ($41 billion), and Arizona ($40 billion).
The largest per-person gap was in Washington, DC, where federal obligations outnumbered contributions by $19,748 per resident. Alaska ($14,990), New Mexico ($13,838), and West Virginia ($11,469) had the biggest gaps among states.
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Page sources and methodology
All of the data on the page was sourced directly from government agencies. The analysis and final review was performed by USAFacts.
Department of the Treasury
USASpending.gov
Internal Revenue Service
Statistics of Income
Gross Collections, by Type of Tax and State
