Connecticut State Income Tax Rates and Brackets for 2025

Key Takeaways

• Connecticut lowers 2025 lowest income tax rates to 2% and 4.5%, easing burden for low-income taxpayers.
• New tax brackets and rates apply to residents, nonresidents, part-year residents, immigrants, and businesses.
• Taxpayers should review withholding, update payments, and use 2025 forms starting January 1, 2025.

Connecticut’s state income tax system for 2025 brings several important updates that affect residents, newcomers, and anyone with taxable income in the state. Understanding these changes is essential for individuals, families, and employers, especially those who have recently moved to Connecticut or are planning to do so. This update explains what has changed, who is affected, when the changes take effect, what actions are required, and the broader implications for pending tax filings and future planning.

Summary of What Changed

For the 2025 tax year, Connecticut has updated its state income tax brackets and rates. These changes continue a trend that began in 2024, when the state lowered the rates for its lowest tax brackets. The most notable adjustments include a reduction in the lowest tax rate from 3% to 2% and a decrease in the next bracket from 5% to 4.5%. These changes are designed to provide some relief to lower and middle-income taxpayers while keeping the overall tax structure progressive, meaning higher earners pay a higher percentage of their income in taxes.

Who Is Affected

The updated state income tax rates and brackets apply to all individuals who are required to file a Connecticut state income tax return for the 2025 tax year. This includes:

• Residents of Connecticut: Anyone who lives in Connecticut for the entire year or part of the year.
• Nonresidents with Connecticut-source income: People who live outside Connecticut but earn income from sources within the state (such as wages, rental income, or business income).
• Part-year residents: Those who moved into or out of Connecticut during the year.
• Immigrants and newcomers: Individuals who have recently moved to Connecticut, including those on work visas, green cards, or other immigration statuses, must comply with these tax rules if they have Connecticut-source income.
• Employers and payroll departments: Businesses with employees in Connecticut must adjust payroll withholding to reflect the new tax rates and brackets.

Effective Dates

The new state income tax rates and brackets are effective for the 2025 tax year. This means they apply to income earned from January 1, 2025, through December 31, 2025. Taxpayers will use these rates when filing their Connecticut state income tax returns in early 2026.

Connecticut State Income Tax Rates and Brackets for 2025

Connecticut’s state income tax system uses a series of brackets, with different rates applying to different portions of taxable income. The rates and brackets for 2025 are as follows:

For Single Filers:
– 2.00%: $0 to $10,000
– 4.50%: $10,001 to $50,000
– 5.50%: $50,001 to $100,000
– 6.00%: $100,001 to $200,000
– 6.50%: $200,001 to $250,000
– 6.90%: $250,001 to $500,000
– 6.99%: Over $500,000

For Heads of Household:
– 2.00%: $0 to $16,000
– 4.50%: $16,001 to $80,000
– 5.50%: $80,001 to $160,000
– 6.00%: $160,001 to $320,000
– 6.50%: $320,001 to $400,000
– 6.90%: $400,001 to $800,000
– 6.99%: Over $800,000

For Married Filing Jointly:
– 2.00%: $0 to $20,000
– 4.50%: $20,001 to $100,000
– 5.50%: $100,001 to $200,000
– 6.00%: $200,001 to $400,000
– 6.50%: $400,001 to $500,000
– 6.90%: $500,001 to $1,000,000
– 6.99%: Over $1,000,000

How the Tax Brackets Work

Connecticut’s state income tax is progressive. This means that as your income increases, the rate you pay on each additional dollar also increases. For example, if you are a single filer earning $120,000, you do not pay 6% on your entire income. Instead, you pay:

• 2% on the first $10,000,
• 4.5% on the next $40,000,
• 5.5% on the next $50,000,
• 6% on the remaining $20,000.

This structure helps ensure that lower-income earners pay a smaller share of their income in taxes, while higher earners pay more.

Personal Exemption and Taxable Income

Connecticut calculates state income tax based on your federal adjusted gross income (AGI), which is your total income minus certain deductions allowed by the federal government. From your AGI, you can subtract the Connecticut personal exemption to arrive at your Connecticut taxable income.

• The personal exemption can be as high as $24,000, depending on your filing status and income level.
• The exemption amount decreases as your income rises, and it may phase out completely for higher earners.

Phaseout Provisions

Connecticut uses phaseout rules for both the personal exemption and certain tax rates. This means that as your income increases beyond certain thresholds, you may lose some or all of your personal exemption, and you may be subject to higher effective tax rates. These phaseouts can make tax planning more complex, especially for those whose income is near the phaseout thresholds.

Required Actions for Taxpayers

If you live or work in Connecticut, or if you have Connecticut-source income, you need to take the following steps:

1. Review Your Withholding: Check your current payroll withholding to make sure it matches the new tax rates and brackets. If you are an employee, your employer should update your withholding automatically, but it’s wise to double-check.
2. Update Estimated Payments: If you make estimated tax payments (for example, if you are self-employed or have other income not subject to withholding), adjust your payments to reflect the new rates.
3. Gather Documentation: Keep records of your income, deductions, and any Connecticut-source income if you are a nonresident or part-year resident.
4. Use Updated Forms: When filing your 2025 Connecticut state income tax return, use the latest forms and instructions. These are available on the Connecticut Department of Revenue Services website.
5. Consult a Tax Professional: If you have complex income, are unsure about your residency status, or are new to Connecticut, consider seeking help from a tax professional familiar with Connecticut’s tax laws.

Implications for Pending Applications and New Arrivals

For immigrants, newcomers, and those with pending immigration or residency applications, understanding Connecticut’s state income tax rules is especially important. Here’s why:

• Residency Status: Your tax obligations depend on whether you are considered a resident, part-year resident, or nonresident. Immigration status can affect your residency for tax purposes, so it’s important to review the rules carefully.
• Tax Filing Requirements: Even if you are not a U.S. citizen, you may need to file a Connecticut state income tax return if you have income from Connecticut sources.
• Impact on Immigration Applications: Some immigration processes, such as green card applications or naturalization, may require proof of tax compliance. Make sure you file all required state and federal tax returns and keep copies for your records.
• Social Security Numbers and ITINs: If you do not have a Social Security Number, you may need to apply for an Individual Taxpayer Identification Number (ITIN) to file your state income tax return.

Practical Examples

To help you understand how these changes might affect you, here are a few scenarios:

• Single Filer, Recent Immigrant: Maria moved to Connecticut in March 2025 on a work visa. She earns $60,000 a year. She will pay 2% on her first $10,000, 4.5% on the next $40,000, and 5.5% on the remaining $10,000. She should also check if she qualifies for the personal exemption and whether any phaseout applies.
• Married Couple, Filing Jointly: John and Priya, both working in Connecticut, have a combined income of $150,000. They will pay 2% on their first $20,000, 4.5% on the next $80,000, and 5.5% on the remaining $50,000. They should review their withholding and make sure they use the correct filing status.
• Nonresident with Connecticut Income: Alex lives in New York but works part-time in Connecticut. He must file a Connecticut nonresident tax return and pay state income tax on his Connecticut earnings, using the same brackets as residents.

Expert Perspectives and Analysis

According to analysis by VisaVerge.com, the recent changes to Connecticut’s state income tax rates reflect a broader effort to make the tax system fairer for lower and middle-income residents. By lowering the rates for the lowest brackets, the state aims to reduce the tax burden on those who may be most affected by rising living costs. However, the phaseout provisions and the complexity of multiple brackets mean that higher earners and those with fluctuating incomes need to pay close attention to their tax planning.

Experts also point out that while these changes may provide some relief, Connecticut remains a state with relatively high income tax rates at the upper end. This can influence decisions for families and businesses considering a move to Connecticut, especially when compared to states with no income tax.

Additional Resources and Official Links

For the most accurate and up-to-date information on Connecticut state income tax, including forms, instructions, and guidance for residents, nonresidents, and part-year residents, visit the Connecticut Department of Revenue Services. This official site provides:

• Downloadable tax forms for 2025
• Instructions for calculating taxable income and applying exemptions
• Information on residency status and filing requirements
• Contact details for taxpayer assistance

Other helpful resources include:

• eFile.com: Offers online tools for preparing and filing Connecticut state income tax returns.
• Tax Foundation: Provides analysis and data on state income tax rates and policies across the United States 🇺🇸.

Future Outlook and Monitoring for Changes

As of July 9, 2025, there are no announced changes to Connecticut’s state income tax brackets or rates for the rest of the year. However, tax laws can change quickly, especially in response to economic conditions or state budget needs. Taxpayers should:

• Monitor official announcements from the Connecticut Department of Revenue Services
• Review tax planning strategies each year, especially if their income or residency status changes
• Stay informed about any new credits, deductions, or policy changes that could affect their tax bill

Key Takeaways and Next Steps

• Connecticut’s state income tax rates and brackets for 2025 are now in effect, with lower rates for the lowest brackets and phaseout provisions for higher earners.
• All residents, nonresidents with Connecticut income, and part-year residents must use these rates when filing 2025 state income tax returns.
• Review your withholding, update estimated payments, and use the latest forms to ensure compliance.
• Immigrants and newcomers should pay special attention to residency rules and keep records for immigration and tax purposes.
• Visit the Connecticut Department of Revenue Services for official forms and guidance.
• Consult a tax professional if you have questions about your specific situation.

By staying informed and taking the right steps now, you can avoid surprises at tax time and make sure you meet all your Connecticut state income tax obligations for 2025.

Learn Today

State Income Tax → A tax imposed on income earned by residents and nonresidents within a state’s jurisdiction.
Tax Bracket → Income ranges taxed at specific rates, determining how much tax is owed progressively.
Personal Exemption → A deduction reducing taxable income based on filing status and income level.
Phaseout → Gradual reduction or elimination of tax benefits as income rises beyond set thresholds.
Estimated Payments → Periodic tax payments made by individuals or businesses without payroll withholding.

This Article in a Nutshell

Connecticut’s 2025 state income tax updates reduce lowest bracket rates to ease tax burdens. All filers must use new brackets starting in 2025. Immigrants and nonresidents are included. Review withholding and payments now, and consult professionals to ensure compliance with changing state tax rules and phaseout provisions.
— By VisaVerge.com