Utah Tax Guide 2026

Personal income tax — Utah's flat-tax model

Utah was the first US state to adopt a true flat income tax (2008). Multiple rate reductions over recent years: • 2018: 5.0% → 4.95% • 2022: 4.95% → 4.85% (HB 54 of 2022) • 2023: 4.85% → 4.65% (HB 54 of 2023, retroactive) • 2024: 4.65% → 4.55% (HB 54 of 2024) • 2025/2026: 4.55% maintained Utah Code §59-10-104 imposes 4.55% on Utah taxable income (which generally tracks federal taxable income with adjustments). Standard deduction conforms to FEDERAL — $15,000 single / $30,000 MFJ for 2026. TAXPAYER TAX CREDIT (Utah Code §59-10-1018): a refundable credit equal to 6% of the federal personal exemption + standard deduction, phased out as income exceeds threshold ($16,000 single / $32,000 MFJ x phase-out rate). For low-income filers, this credit effectively zeroes out Utah tax; for middle-income, partial credit; for high-income, no credit. No state QBI deduction (Utah does NOT conform to federal §199A — adds back the federal QBI deduction). For pass-through owners, this is a meaningful Utah-side cost. No state AMT.

Social Security and retirement credits

Utah used to tax Social Security at full ordinary rates. SB 11 of 2021 created a Social Security tax credit (Utah Code §59-10-1019) effectively excluding Social Security from Utah income tax for low/middle-income filers: • Full credit (effective SS exclusion): for federal AGI ≤ $45,000 single / $75,000 MFJ (approximate; verify 2026 indexing) • Phases out at 2.5% per $1 of AGI above threshold • Zero credit at AGI > $75,000 single / $105,000 MFJ High-income retirees still pay 4.55% on Social Security benefits — Utah is one of only 9 remaining states that tax SS at any income level. Military Retired Pay tax credit (Utah Code §59-10-1042): up to 100% of military retirement pay can be claimed as a credit (subject to income phase-out and other conditions) — effectively exempts military pension for qualifying retirees. No general pension/IRA exclusion (taxed at 4.55% as ordinary income, subject to taxpayer credit and SS credit limitations).

Sales tax

State rate 4.85% + mandatory 1% local-option county sales tax + city/county additional sales tax = combined average ~7.20%. Notable cities: • Salt Lake City: 7.75% combined • Park City: 9.55% (resort area, includes 2.65% resort tax) • Provo: 7.5% • Ogden: 7.75% • St. George: 6.75% • Moab: 8.85% (resort tax) Groceries: REDUCED RATE 3.0% (1.75% state + 1.25% local) — Utah has a reduced grocery rate but does not exempt food entirely. HB 101 of 2023 proposed full repeal contingent on constitutional amendment (didn't pass). Prescription drugs: exempt. Clothing: taxable. Most services: exempt. Resort Communities Tax (Utah Code §59-12-401): Park City, Brian Head, Springdale (Zion), Moab, etc. can add up to 1.6% additional sales tax for tourism infrastructure. Economic nexus (Utah Code §59-12-107): $100,000 in cumulative sales OR 200 transactions.

Property tax — low and stable

Statewide average effective ~0.55% — among the lowest in the US. Counties: Salt Lake: ~0.62%, Utah (Provo): ~0.55%, Davis (Bountiful): ~0.60%, Weber (Ogden): ~0.66%, Summit (Park City): ~0.50% (lower because high property values dilute effective rate). Residential property is assessed at 55% of fair market value for primary residences (Utah Const. Art. XIII §3) — the PRIMARY RESIDENCE EXEMPTION reduces taxable value by 45%. Non-residential and second-home properties are assessed at full market value. Circuit Breaker Property Tax Relief (Utah Code §59-2-1209): low-income elderly/disabled receive refundable credit (max ~$1,200) reducing effective burden. No personal property tax on most household goods. Business personal property is taxed, but with a $25,000 exemption per taxpayer. The 45% primary-residence reduction + low statewide rates make Utah very property-tax-favorable for homeowners — particularly compared to neighboring Idaho (~0.67%) and Colorado (~0.51%, comparable).

Business considerations

Corporate income tax: 4.55% flat (Utah Code §59-7-104) — matches individual. LLC fee: $20 annual report (Utah Code §16-10a-1607 framework, applied to LLCs). Apportionment: single-sales factor for most industries (Utah Code §59-7-311). PTET: Utah enacted PTET via SB 39 of 2022 — entity-level election at flat 4.55% individual rate; refundable credit to owners. Unemployment tax: 0.1%–7.1% on $48,900 wage base. No estate, inheritance, or gift tax. Utah's tax structure: flat low rates across personal, corporate, and capital gains (no preferential capital gains treatment — all gains at 4.55%) + low property tax + moderate sales tax + no estate tax — produces a competitive overall burden for high-income earners and business owners. The trade-off is the lack of QBI conformity (high-income pass-through owners face higher Utah taxable income than federal) and the partial SS taxation for higher-income retirees.

Worked example: Joshua Bingham, Lehi-based SaaS founder/CEO (single, 2026)

Joshua takes $180,000 W-2 reasonable comp as S-corp owner-CEO and $220,000 K-1 distribution. Owns a $675,000 Lehi home (primary residence).

Federal: SS/Medicare on $180k W-2 + ordinary income tax on $400k total + §199A 20% QBI (SaaS = NON-SSTB → full QBI eligible) + S-corp avoids SE tax on K-1. Utah: Federal AGI: $400,000 Less standard deduction: $15,000 Add back federal QBI: +$45,000 (Utah doesn't allow QBI; add back what was deducted federally if subtracted in federal taxable income flow) Utah taxable: $430,000 Tax at 4.55% flat: $19,565 Taxpayer Tax Credit: $0 (fully phased out at his income) SS Credit: not applicable (working age) Property tax on $675k Lehi primary residence: Assessed at 55% × $675,000 = $371,250 × effective millage ~1.0% = $3,713/yr (approximate) Utah sales tax: 7.10% Lehi (Utah County 6.85% + local). Utah PTET option (SB 39 of 2022): Joshua's S-corp could elect PTET, paying 4.55% × $220k K-1 = $10,010 at entity level (federally deductible above SALT cap), Joshua gets full refundable Utah credit of $10,010 against his personal Utah tax. Net Utah tax unchanged but ~$3,700 federal SALT-cap benefit (37% × $10,010). Total Utah annual state burden: $19,565 income tax + $3,713 property + sales tax on purchases.

Statute references

• Personal income tax 4.55% flat — Utah Code §59-10-104 (HB 54 of 2024)
• Taxpayer Tax Credit — Utah Code §59-10-1018
• Social Security tax credit — Utah Code §59-10-1019
• Military Retired Pay credit — Utah Code §59-10-1042
• Sales tax 4.85% — Utah Code §59-12-103
• Resort Communities Tax — Utah Code §59-12-401
• Economic nexus (Wayfair) — Utah Code §59-12-107
• Corporate income tax 4.55% — Utah Code §59-7-104
• Apportionment (single sales factor) — Utah Code §59-7-311
• Primary residence 45% exemption — Utah Const. Art. XIII §3
• Circuit Breaker — Utah Code §59-2-1209

Related pages

• State Tax Comparison →
• QBI §199A Deduction →
• PTET Analyzer →