State taxes: North Carolina

Overview of North Carolina Taxes

The North Carolina state income tax is currently 5.75%. As of 2014, the state eliminated progressive income tax rates. All state taxpayers now face the 5.75% rate since 2015, which has remained constant in subsequent tax years. More on North Carolina taxes can be found in the tabbed pages below.

Personal income tax

North Carolina collects a flat income on its residents. Effective Jan. 1, 2015, that flat tax rate is 5.75%.

North Carolina individual income tax returns are due April 15 or the next business day if that date falls on a weekend or holiday.

Sales taxes

On July 1, 2011, the state sales tax dropped a percentage point to 4.75%.

Most taxable sales or purchases are subject to the state tax, as well as a local tax levied by all counties. The rate in most counties is 2%, but it is as much as 2.75% in certain counties.

The North Carolina Department of Revenue offers a complete list of tax rates for its counties.

North Carolina also has a use tax, which applies to all out-of-state purchases of tangible personal property that would be subject to the sales tax if purchased in North Carolina. In these cases, taxpayers should file Form E-554.

Personal and real property taxes

The property tax in North Carolina is a locally assessed tax collected by the counties. The state Department of Revenue does not send property tax bills or collect property taxes.

The 3 main elements of the property tax system in North Carolina are real property, personal property and motor vehicles.

For almost all the segments of the property tax, Jan. 1 is the tax lien date. In other words, an individual owning property as of that date is liable for property taxes in the county where the property is located.

Listings of the state’s property tax rates since 1998 are available on the North Carolina Department of Revenue website.

North Carolina offers various property tax exclusions, including tax breaks for the elderly, veterans and the disabled.

For further information regarding property tax, contact your local county assessor.

Inheritance and estate taxes

North Carolina does not collect an inheritance tax.

The North Carolina estate tax was repealed effective as of the 2013 tax year.

Other North Carolina tax facts

North Carolina taxpayers can check the status of their state returns online.

Taxpayers can have their state refund money directly deposited into a bank account (if the return was electronically filed), sent as a paper check, credited to their estimated income tax account or credited as a contribution to the state’s wildlife fund.

The North Carolina Department of Revenue publishes the names of individuals and businesses that owe delinquent state taxes.

For more information, visit the North Carolina Department of Revenue website.

To download tax forms on this site, you will need to install a free copy of Adobe Acrobat Reader. Click here for instructions.