In New York, San Francisco, and Honolulu Your $300,000 Salary Feels Like Just $100,000

By Jo Constantz

It’s tax season in the US, and nowhere is that felt more acutely than in three cities — New York, San Francisco and Honolulu — where you need a salary of over $300,000 to bring home $100,000 after taxes and adjustments for the cost of living.

Photo by Tima Miroshnichenko:

That’s according to an analysis by SmartAsset, a consumer-focused financial information provider. The firm adjusted $100,000 for the local cost of living in 76 of the largest US cities and then used its paycheck calculator to account for federal, state and local taxes for a single taxpayer with an annual salary and no additional withholdings.

Residents of the country’s priciest cities, contending with formidable housing costs and other mounting expenses, need a net income of over $180,000 for their purchasing power to break the $100,000 mark, according to SmartAsset’s analysis of the Council for Community and Economic Research’s cost-of-living data. And since high-earners are taxed upwards of 40% in those cities, they need to command top dollar for their take-home pay to actually feel like six figures.

Meanwhile, in Houston, an employee only needs to gross about $125,000 to achieve the same purchasing power as someone making $312,000 in New York. A six-figure paycheck is much easier to achieve in Texas, according to SmartAsset’s analysis, since the cost of living in many Lone Star State cities is lower than the national average and residents don’t pay a state income tax.  In cities like El Paso, Corpus Christi and Lubbock, salaries can be as low as $122,000 and still feel like a true $100,000.

Remote work has opened up more opportunities for professionals, newly untethered from offices, to choose where to live, prompting the question: Stick it out in big-ticket cities like New York and San Francisco, or head to states like Florida and Texas for warmer climes and a more affordable lifestyle? After two years of red-hot inflation, many are taking the uneven landscape of taxes and cost of living across the country into serious consideration.

Taxes have emerged as a major factor for many considering a move. While Miami, one popular destination, has a higher cost of living than other big cities like Baltimore and Chicago, it’s ultimately more affordable since Florida, like Texas and several other states, doesn’t levy an income tax. In New York, State Comptroller Thomas DiNapoli has cautioned against raising taxes that may prompt more wealthy residents to leave and further erode the state’s revenue base.

That said, recent data suggests the exodus from New York may be slowing somewhat: While the outer boroughs continued to lose residents, Manhattan saw its population rebound in 2022. Still, the city is far from its pre-pandemic baseline, with a total population of 8.3 million — down from 8.8 million in April 2020. 

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