UNDATED – With the tax filing deadline approaching and some states receiving significantly more in federal aid than they pay in taxes the personal finance company WalletHub has released its updated rankings of the 2026’s Most and Least Federally Dependent States, along with expert insights.
The report highlights the degree of economic independence among states. To determine which states rely most and least on federal support, WalletHub evaluated all 50 states using three key measures: the return on federal taxes paid, federal funding as a percentage of state revenue, and the share of federal jobs.
South Dakota was ranked 21st in the study.
| Most Federally Dependent | Least Federally Dependent |
| 1. Alaska | 41. Iowa |
| 2. Kentucky | 42. Nevada |
| 3. West Virginia | 43. Washington |
| 4. Mississippi | 44. California |
| 5. Louisiana | 45. Illinois |
| 6. South Carolina | 46. Kansas |
| 7. Arizona | 47. Utah |
| 8. Indiana | 48. Delaware |
| 9. New Mexico | 49. Massachusetts |
| 10. Montana | 50. New Jersey |
Key Stats
- With an average dependency rank of 21.52, Red States are altogether more reliant on federal funding than Blue States, which rank 32.00 on average. (The lower the rank, the more dependent the state is.)
- There is a 59.00 percent correlation between a state’s federal dependency and its per-capita GDP. That means the least wealthy states tend to receive the most federal support.
- Illinois is the sixth least federally dependent state, which helps explain the fact that it has the highest tax rates in the nation. On the flip side, Alaska is the most federally dependent state and has the lowest tax rates.
To view the full report and your state’s rank, please visit:
https://wallethub.com/edu/states-most-least-dependent-on-the-federal-government/2700
