North Carolina Taxes

North Carolina taxes individual income at a single flat rate. Under Session Law 2023-134, the rate is 4.25% for taxable years beginning in 2025 and 3.99% for taxable years after 2025 — so 3.99% for 2026. The Department of Revenue says additional rate changes may apply to tax years beginning in 2027, depending on whether certain revenue-based rate reduction triggers in that law are met; no lower 2027 rate is confirmed on the department's rate page as of this check.

North Carolina's motor fuel excise tax is SUSPENDED — zero cents (0¢) per gallon — from October 10, 2026 through November 30, 2026, on all motor fuels and alternative fuels, including gasoline and diesel. Session Law 2026-62, signed by Governor Josh Stein on October 9, 2026, ordered the suspension. Unless the law is changed, the 2026 rate of 41.0 cents per gallon set by the Department of Revenue for January 1 through December 31, 2026 applies again from December 1, 2026. The separate state inspection tax of one-fourth of one cent (1/4¢) per gallon (G.S. 119-18) is NOT suspended and still applies to all motor and alternative fuels. The suspension does not change sales tax: motor fuel that was exempt from sales tax stays exempt, and dyed diesel remains generally subject to sales tax. The same law also waives certain penalties through December 31, 2026 for highway use of dyed diesel for farming or agricultural purposes in North Carolina. These are state taxes only.

North Carolina has no sales tax holiday. The statute that created its back-to-school sales tax holiday, G.S. 105-164.13C, and the companion holiday section G.S. 105-164.13D were both "Repealed by Session Laws 2013-316, s. 3.4(a), effective July 1, 2014, and applicable to purchases made on or after July 1, 2014." Clothing, school supplies and computers are taxed at the normal combined state and local rate all year.

North Carolina property tax is levied locally by counties and municipalities, each setting its own rate, so bills vary by location. By law all property, real and personal, is assessed at its true value (or use value where the law allows), and every county and city must levy its tax uniformly on those assessments (G.S. 105-284). Each county must reappraise all real property at least every eight years as of January 1 of its scheduled year, and a county may choose to reappraise sooner (G.S. 105-286) — so your assessed value can jump in a reappraisal year even if the rate does not change.