IRS migration data provide a revealing look at where taxpayers—and their reported income—are moving across the country, with several lower-tax states recording substantial net inflows of adjusted gross income (AGI).
Each year, the IRS Statistics of Income Division, working with the U.S. Census Bureau, publishes migration files based on address changes reported on individual income tax returns. The latest release tracks moves between 2021 returns filed in calendar year 2022 and 2022 returns filed in 2023. In addition to counting taxpayers who changed states or counties, the data measure the AGI associated with those moves.
The 2022–2023 figures show substantial income movement toward several states with relatively competitive tax structures. According to Tax Foundation analysis, Florida recorded approximately $20.6 billion in net AGI inflows, followed by Texas at $5.5 billion, South Carolina at $4.1 billion, North Carolina at $3.9 billion, and Tennessee at $2.8 billion.
Several higher-tax states experienced movement in the opposite direction. California recorded approximately $11.9 billion in net AGI outflows, New York $9.9 billion, Illinois $6.0 billion, Massachusetts $3.9 billion, and New Jersey $2.6 billion.
The geographic concentration is also visible at the county level. Palm Beach County, Florida, recorded approximately $3.0 billion in net AGI inflows, while Cook County, Illinois, posted approximately $4.4 billion in net outflows.
Filer counts provide additional context. Texas gained approximately 56,000 filers and Florida about 55,000, while California, New York, and Illinois recorded some of the largest net declines. Although meaningful, these changes represent only a portion of each state's overall population and tax base.
Taken together, the figures illustrate an important distinction: interstate migration isn't simply about how many people move. The amount of income associated with those households can also have implications for state and local economies.
People relocate for many reasons, but for higher-income households, differences in state tax structures can become an increasingly important part of the calculation.
Family, employment, retirement, housing, and lifestyle all play significant roles in relocation decisions. As the Tax Policy Center has noted, interstate migration is more complicated than a simple high-tax-to-low-tax narrative. IRS migration data themselves do not identify why an individual or household moved.
Still, the financial impact of state taxes can be substantial for higher earners. A household with $500,000 in taxable income, for example, may face materially different state and local tax obligations depending on where it lives. Over many years, those differences can compound, particularly when income taxes are considered alongside property, estate, and other state taxes.
The income characteristics of some migration destinations are notable as well. In Palm Beach County, incoming residents reported average incomes of approximately $178,000, compared with roughly $99,000 for those leaving. While that does not establish taxes as the cause, it suggests that higher-income households are contributing significantly to the county's net AGI gains.
For households already considering a move because of retirement, employment, family, or lifestyle considerations, taxes may therefore become an important financial variable rather than the sole reason for relocating.
Changes in where income is reported can affect state finances differently depending on the size of the tax base and how heavily a state relies on personal income taxes.
States such as California and New York have progressive income tax systems in which higher-income households contribute a significant share of personal income tax revenue. Sustained AGI outflows could therefore affect revenue projections, particularly if departing households are concentrated among higher earners.
States experiencing inflows face a different set of considerations. New residents can bring additional spending, housing demand, business activity, and investment. Even states without individual income taxes can benefit through other revenue sources, including sales and property taxes.
Growth can also create costs. Rapid population and income gains may place additional pressure on housing, transportation, schools, and other infrastructure. States and municipalities must balance those demands against the economic advantages that may have helped attract new residents.
The broader fiscal effect depends on far more than migration alone. Employment growth, new business formation, changes in wages and investment income, housing conditions, and state tax policy all contribute to a state's financial position.
IRS migration figures are useful for identifying broad patterns, but they should not be treated as a direct measure of why people move or whether a state's economy is strengthening or weakening.
The IRS data are based on address changes between consecutive tax returns. They can identify that a taxpayer's reported address changed and associate AGI with that move, but they do not record the motivation for relocating or pinpoint the exact date it occurred.
A tax-return address also does not necessarily capture the full geography of a household's economic activity. Individuals may own property, operate businesses, or earn income across multiple states.
Scale matters as well. A multibillion-dollar AGI outflow may sound dramatic, but its significance depends on the size of the state's overall income and tax base. Large states such as California and New York can experience substantial gross inflows and outflows simultaneously.
For that reason, AGI migration is best viewed alongside other measures, including population trends, employment, business formation, housing activity, and overall economic growth.
Most importantly, the data show where income moved—not why it moved. Taxes may influence relocation decisions, particularly for higher-income households, but the IRS figures alone cannot establish a direct causal relationship.
Taxes can be an important consideration in a relocation decision, but the potential savings should be evaluated alongside the broader financial and personal consequences of moving.
Start by comparing the full tax picture rather than income taxes alone. Property taxes, sales taxes, estate or inheritance taxes, and other state and local levies can materially change the economics of a move. A state with no individual income tax is not necessarily the lowest-cost place to live.
Cost of living matters for the same reason. Housing, insurance, health care, transportation, and other expenses can offset some or all of the anticipated tax savings.
Residency rules also deserve careful attention. Establishing domicile in a new state generally involves more than counting days. Where you maintain a home, work, register vehicles, vote, keep important records, and maintain other personal connections may all be relevant depending on the states involved.
Finally, consider the decision over a longer horizon. Career opportunities, proximity to family, housing preferences, retirement plans, and lifestyle can be just as important as the annual tax difference.
For someone already considering relocation, modeling these variables together can provide a more useful answer than focusing on tax rates alone. Coordinating with tax, legal, and financial professionals can also help identify potential consequences before establishing residency in a new state.
Sources:
Tax Foundation, April 20, 2026
IRS.gov, SOI Tax Stats, Migration Data (2022–2023 tax filing data), March 2026