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States that Pay More to the Federal Government Than They Receive

More than a third of the
Revenue of the United States federal government
originates from the nation’s four largest states, yet they frequently receive less in return than they provide.

Referred to as “donor states,” 19 states pay more in federal taxes than they get back through federal expenditures, per information gathered by USA Facts, an independent non-profit organization that monitors governmental spending. This calculation is based on the “net payment” concept, which measures the gap between the federal taxes collected from a state’s individuals and companies versus the federal money received by the state for initiatives such as Medicaid, food assistance, transportation projects, and educational funding. When this figure is negative, it means the state functions as a donor state.

The Trump administration encouraged states to take on greater accountability for financing various services such as healthcare and nutrition aid, even though most U.S. states continue to depend on federal support for these initiatives.

“There are 90,000 local governments across the nation responsible for gathering income taxes, payroll taxes, and corporate income taxes, which often flow to the federal government. The federal government subsequently returns much of this funding to individuals through different programs or initiatives supported by the government,” stated Richard Coffin, head of research at USA Facts.

The U.S. federal government gathered approximately $4.6 trillion from state sources in 2023, with about $4.5 trillion being returned via public support initiatives such as Medicaid and Social Security.

Thirty-one states along with the District of Columbia got back more money than they contributed. For instance, New Mexico sent approximately $12.4 billion in taxes to the federal government but was allocated over $41.8 billion in return through federal funding. In comparison, Florida, which is among 19 contributing states, paid in $310.6 billion yet only received $293.4 billion back.

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It is expected that states with larger populations and greater employment opportunities—particularly those offering higher wages—will generally contribute more to the federal government than states and localities with fewer residents and workers, according to Coffin.

Nevertheless, exceptions do exist. For instance, Delaware spends significantly more per person than other states due to the large number of businesses incorporated there. In 2023, residents of Delaware paid approximately $24,574, whereas individuals in neighboring West Virginia paid about $4,866.

Regarding the states that receive funding, it essentially depends on where these programs are directed,” Coffin stated. “Many of them are allocated towards needs-based initiatives, which are designed for individuals within specific income brackets, typically those with lower incomes—this includes Medicaid, SNAP, and similar assistance.

Thus, areas with a larger population of individuals living below the poverty line will receive greater funding.

Federal funding is also utilized by states for their educational agencies and infrastructure initiatives. In regard to these projects, regions requiring immediate “shovel-ready” developments are likely to receive more federal investment.

The conclusions from USA Facts have received support from additional experts, including the California Budget and Policy Center.
finding in March
That California contributed $83 billion more in federal taxes than it obtained in federal assistance during 2022. Analysts cautioned that reductions in federal funding under the Trump administration might result in a larger disparity moving forward.

The so-called “One Big Beautiful Bill,” enacted by President Trump on July 4, involved modifications to taxes and expenditures that may affect communities throughout the United States, placing more responsibility on states to cover expenses related to SNAP and Medicaid programs.

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In theory, this would reduce the amount the federal government spends, which could make the distribution of funds slightly more balanced,” Coffin stated. “This means that states receiving more money from the federal government might end up getting a little less. I’m not certain it would affect how much individuals pay overall, as the tax system itself remains unchanged.

contacted the U.S. Treasury for input regarding these issues through electronic mail on Tuesday afternoon.


Differences in population result in different amounts of money spent per individual by the federal government, as states with smaller yet aging populations often require greater support compared to areas with bigger, younger demographics. Additionally, regions hosting significant military installations typically experience higher levels of governmental expenditure than those without such facilities.

A military installation located within a state can potentially generate employment opportunities in that area and have an immediate effect on the local population,” Coffin stated. “However, the advantages extend well beyond this. It serves the greater interest of the nation.

I reside in Seattle. When funds are directed towards Boeing to develop products for the military, it definitely generates employment and economic prospects within my local area, as well as benefits that extend to the entire nation.


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