Understanding donor and recipient states
Every year, the federal government collects trillions of dollars in taxes from individuals and businesses across all 50 states. But does your state get that money back? Or does it send more than it receives?
Up Next
Transcript
Let's talk about your tax dollars. You send money to DC, but here's the question. Does your state get that money back or does it send more than it receives?
I'm Steve Ballmer, and these are some quick facts from USA Facts.
For states, show me the money. Every year, the federal government collects trillions in taxes from individuals and businesses and then spends trillions through programs like Social Security, Medicare, Medicaid, SNAP, which is often referred to as food stamps, defense, and infrastructure.
But that money doesn't go back to each state quite evenly. States that send more than they get are sometimes called donor states.
Others receive more than they contribute, often called recipient states. So what states are we talking about?
On the donor side, there are 19 states. Examples are California, New York, New Jersey, Massachusetts, Washington, Texas, and Georgia. These are states sending more in federal taxes than they get back.
Here's a map that shows every state. The donor states are in green. The recipient states are in purple. I'm recording this here in Seattle, Washington, which is a donor state. What about your state?
Is your state a donor or a recipient state?
Now, here's where it gets interesting. This isn't as simple as who gets more or less. First, donor states still receive a lot of federal money. We're talking tens or hundreds of billions of dollars flowing back. They just don't get back as much as they put in.
California is by far the top donor, contributing about 276 billion more than they get back. It's also our largest state by population.
Nineteen states sent more to the federal government than they received in FY 2024.
Balance of funds between residents and the federal government, FY 2024
Second, some states receive more not because people are paying less in taxes, but because the federal government spends a lot of money there. Virginia is a great example. It's the top recipient state. It receives about 89 billion more than it contributes.
However, you've got the Pentagon, the home of the Department of Defense there, major military installations in Virginia like Naval Station Norfolk, and nearly 150,000 federal employees working across agencies. That all gets counted in what is received in Virginia.
Third, when you look at total dollars sent to the federal government, big states like California are at the top. But when you switch to looking at it per person, the leaders look different. States like Massachusetts, Nebraska, and Minnesota stand out for sending more dollars per capita.
Per-capita revenue collected by the federal government by state
Fiscal year 2024
And on the receiving side, Alaska gets the most per capita.
Per-capita obligations made by the federal government by state
Fiscal year 2024
There are a lot of reasons for the differences between states. It's not simple. It's not written in stone. And there's no right or wrong for any given state. We're one country, but we have a lot of different gives and takes. Subscribe to our newsletter at usafax.org and our YouTube channel. At USAFacts, we give you the data. You make up your own mind.