New data from the IRS reveals that all 10 counties with the largest net losses of taxpayers are located in California and New York. These migration patterns, compiled from federal tax returns, highlight a significant outflow of residents and their associated income from high-tax states to destinations in the Sun Belt and Mountain West.
Los Angeles County, California, recorded the largest net loss of tax filers, with 17,496 individuals departing. These individuals took an estimated $1.9 billion in income with them. Other California and New York counties also experienced substantial losses, including Queens County, New York (-17,109), the Bronx, New York (-16,319), Orange County, California (-11,618), and Suffolk County, New York (-10,434).
Economists suggest that these migration trends can profoundly impact state economies by altering tax bases, affecting funding for public services such as schools and infrastructure, and influencing housing markets. The shift in population is often attributed to residents seeking lower tax burdens, reduced cost of living, and greater affordability.
While Manhattan, New York, saw a net gain of more interstate tax filers than any other county, it simultaneously lost nearly $1 billion in adjusted gross income. This suggests that many new arrivals may have lower incomes compared to those who left.
"It's very, very clear that people ultimately vote with their feet and when they feel like they're getting taxed too much, they go somewhere else where they will be taxed less," stated E.J. Antoni, chief economist for the Heritage Foundation. He noted that popular destinations include Texas, Tennessee, and Florida – states with low or no income taxes.
Other counties among the top 10 for taxpayer losses include San Diego County, California (-9,401); Nassau County, New York (-9,130); Riverside County, California (-8,968); San Bernardino County, California (-8,462); and Kings County, New York (-6,924).
Conversely, counties experiencing the largest net gains in interstate tax filers include Maricopa County, Arizona (+9,353), Harris County, Texas (+8,955), King County, Washington (+8,297), and Clark County, Nevada (+7,524).
Paul Teller, a conservative strategist, commented that the trend of Americans leaving high-tax, highly regulated states for areas with lower costs and taxes serves as a warning to policymakers in states experiencing significant resident outflows. He expressed surprise at the apparent lack of concern in some of the states losing population, predicting long-term fiscal consequences if affluent taxpayers continue to depart.