Delaware's most distinctive tax feature: no general sales tax - one of only five states in the U.S. without one. For income tax, Delaware uses a 7-bracket graduated structure from 0% to 6.6%, with the same thresholds for all filing statuses. The first $2,000 of income is taxed at 0%. Delaware does not tax Social Security benefits, and residents of Wilmington pay an additional city wage tax of approximately 1.25% on earned income.
Sales Tax
None (0%)
Income Tax
0%–6.6% (7 brackets)
First $2,000
0% (zero bracket)
Standard Deduction (Single)
$3,250
Delaware Has No General Sales Tax
Delaware is one of five U.S. states that imposes no general sales tax on retail purchases (alongside Alaska, Montana, New Hampshire, and Oregon). Delaware consumers pay $0 in sales tax when purchasing goods at retail. This makes Delaware a popular shopping destination for residents of neighboring Maryland, Pennsylvania, and New Jersey - all of which have sales taxes in the 6–7% range.
Delaware does impose a gross receipts tax on businesses, which is calculated as a percentage of a business's gross revenue rather than a per-transaction consumer sales tax. This business tax is not visible at the point of sale and does not appear on consumer receipts.
Because there is no sales tax, there is also no grocery tax. Delaware shoppers pay nothing in state tax on food, clothing, or other retail purchases.
Delaware Income Tax Brackets 2026
Delaware's 7-bracket structure includes a true 0% bracket on the first $2,000 of income. The same bracket thresholds apply to all filing statuses. All brackets confirmed for TY2026 by the Delaware Division of Revenue.
Delaware Taxable Income (All Filing Statuses)
Rate
$0 – $2,000
0.00%
$2,000 – $5,000
2.20%
$5,000 – $10,000
3.90%
$10,000 – $20,000
4.80%
$20,000 – $25,000
5.20%
$25,000 – $60,000
5.55%
$60,000+
6.60%
Delaware's bracket thresholds have been stable for many years. The top 6.6% rate applies to all income above $60,000 - a relatively low threshold compared to other states. Delaware taxes capital gains as ordinary income at these same graduated rates.
Delaware Standard Deduction & Personal Exemption 2026
Delaware does not conform to the federal standard deduction and uses its own significantly lower amounts. Delaware also provides a small personal exemption:
Filing Status
Standard Deduction
Personal Exemption
Single
$3,250
$110
Married Filing Jointly
$6,500
$220
Married Filing Separately
$3,250
$110
Head of Household
$3,250
$110
Delaware's standard deduction of $3,250 (single) is substantially lower than the federal standard deduction of $15,700. Delaware filers cannot claim the federal standard deduction on their Delaware return; they must use Delaware's own amounts.
No. Delaware has no general sales tax. Delaware is one of only five U.S. states without a general sales tax (the others are Alaska, Montana, New Hampshire, and Oregon). Delaware consumers pay no state sales tax on purchases of goods. Delaware does impose a gross receipts tax on businesses, but this is a business-level tax - not a consumer sales tax passed at the register. The absence of a sales tax is a significant tax advantage for Delaware shoppers and is a primary reason many people cross state lines to shop in Delaware.
What are Delaware's income tax brackets for 2026?
Delaware uses a 7-bracket graduated income tax with the same thresholds for all filing statuses. The brackets are: 0% on the first $2,000 (a true zero-tax bracket); 2.2% on $2,000–$5,000; 3.9% on $5,000–$10,000; 4.8% on $10,000–$20,000; 5.2% on $20,000–$25,000; 5.55% on $25,000–$60,000; and 6.6% on income above $60,000. All brackets are confirmed for TY2026 by the Delaware Division of Revenue.
What is the Wilmington city wage tax and who has to pay it?
The City of Wilmington imposes a city wage tax of approximately 1.25% on earned income. This applies to: (1) Wilmington residents on all earned income regardless of where the work is performed, and (2) Wilmington non-residents who work within city limits. If you live or work in Wilmington, your paycheck withholding will include both the Delaware state income tax and the Wilmington city wage tax. No other Delaware municipality imposes a local income tax. Verify the current Wilmington rate with the City of Wilmington Finance Department.
Does Delaware tax Social Security or retirement income?
Delaware does not tax Social Security benefits. Delaware also provides a pension and retirement income exclusion for qualifying filers: taxpayers age 60 and older may exclude up to $12,500 of pension, 401(k), IRA, and similar retirement income from Delaware taxable income. Filers under age 60 may exclude up to $2,000. These exclusion amounts are pending final verification for TY2026 with the Delaware Division of Revenue.
What is Delaware's standard deduction and personal exemption for 2026?
Delaware does not conform to the federal standard deduction. Delaware uses its own deduction amounts: $3,250 standard deduction for single filers and $6,500 for MFJ - substantially lower than the federal amounts. Delaware also provides a small personal exemption of $110 per single filer and $220 for MFJ. These amounts are confirmed by the Delaware Division of Revenue for TY2026.
Does Delaware conform to the OBBBA tips and overtime deductions?
Delaware's OBBBA conformity status for tips and overtime deductions is not yet confirmed. Delaware has its own tax code that partially conforms to the Internal Revenue Code. The Delaware Division of Revenue has not published guidance indicating whether Delaware will adopt the federal tip income deduction, overtime deduction, or senior bonus deduction for TY2026. Delaware residents with tip income or overtime pay should monitor the Division of Revenue website for guidance.
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