Taxes in Oklahoma: State Tax Guide 2026
Data Notice: Figures, rates, and statistics cited in this article are based on the most recent available data at time of writing and may reflect projections or prior-year figures. Always verify current numbers with official sources before making financial, medical, or educational decisions.
Taxes in Oklahoma: State Tax Guide 2026
Tax information is for educational purposes only and does not constitute tax advice. Consult a licensed tax professional for your specific situation.
Oklahoma offers a relatively affordable tax environment with a top income tax rate of 4.75%, below-average property taxes, and a moderate sales tax base rate that is significantly augmented by local add-ons. The state’s economy is heavily influenced by the energy sector, and its tax code includes provisions specific to oil and gas production. Oklahoma does not tax Social Security benefits and provides a generous retirement income exclusion, making it a viable option for retirees on a budget.
Oklahoma Income Tax Rates (2026)
Oklahoma uses a progressive income tax with six brackets. Rates for single filers:
| Tax Rate | Taxable Income Range |
|---|---|
| 0.25% | $0 – ~$1,000 |
| 0.75% | ~$1,001 – ~$2,500 |
| 1.75% | ~$2,501 – ~$3,750 |
| 2.75% | ~$3,751 – ~$4,900 |
| 3.75% | ~$4,901 – ~$7,200 |
| 4.75% | Over ~$7,200 |
Married filing jointly: the top rate of 4.75% applies above ~$12,200.
Oklahoma’s standard deduction is ~$6,350 for single filers and ~$12,700 for married filing jointly. Personal exemptions are ~$1,000 per taxpayer and dependent.
Sales Tax
| Component | Rate |
|---|---|
| State base rate | 4.50% |
| Average combined (state + local) | ~8.98% |
| Highest combined rate | ~11.50% |
Oklahoma allows cities and counties to add substantial local sales taxes. Oklahoma City’s combined rate is approximately ~8.63%, and Tulsa’s is approximately ~8.52%. Some smaller jurisdictions push above 10%.
Groceries: Fully taxable at the combined rate. Oklahoma eliminated the state sales tax on groceries effective 2024 (state portion only), but local sales taxes still apply to grocery purchases. Confirm current status for 2026, as legislative adjustments may have occurred.
Exempt from sales tax: Prescription medications.
Property Tax
| Metric | Amount |
|---|---|
| Average effective rate | ~0.86% |
| National average | 0.99% |
Oklahoma property taxes are below the national average. Properties are assessed at 11%–13.5% of fair market value depending on the county.
Homestead exemption: $1,000 of assessed value (not market value) is exempt for owner-occupied primary residences. Homeowners with household income below ~$25,000 and who are 65+ or totally disabled may qualify for an additional exemption of up to ~$200,000 of fair market value (the “double homestead”).
Assessment cap: Property assessments for homesteaded properties cannot increase more than 3% per year (5% for non-homesteaded).
Other Taxes
- Estate and inheritance tax: Oklahoma does not impose a state estate tax or inheritance tax.
- Capital gains: Taxed as ordinary income at rates up to 4.75%. Oklahoma previously offered a capital gains deduction for Oklahoma-sourced assets, but this has been modified in recent years — verify current status.
- Gross production tax (oil and gas): Oklahoma taxes oil and gas production. Rates vary (typically 2%–7%) depending on the well type and age. This is a major revenue source.
- Fuel tax: ~$0.20 per gallon.
- Cigarette tax: ~$2.03 per pack.
- Alcohol taxes: ~$5.56 per gallon of spirits. Beer is taxed at ~$0.40 per gallon.
- Vehicle excise tax: 1.25%–3.25% of the purchase price, depending on age of vehicle (new vehicles pay 3.25%).
- No local income taxes.
Tax Breaks and Credits
- No Social Security tax: Oklahoma does not tax Social Security benefits.
- Retirement income exclusion: Up to ~$10,000 per person of qualifying retirement income (from pensions, 401(k), IRA, etc.) can be excluded from Oklahoma taxable income. This exclusion applies in addition to the Social Security exemption.
- Military retirement: Up to 75% of military retirement pay is excluded from state taxable income (increasing under recent legislation, with a goal of full exclusion).
- Oklahoma EITC: ~5% of the federal Earned Income Tax Credit (nonrefundable).
- Child tax credit: ~$1,000 per qualifying child (enacted in recent legislation as part of tax reform efforts).
- Sales tax relief credit: A refundable credit for low-income taxpayers to offset the burden of sales taxes, typically ~$40–$60 per person.
- 529 plan deduction: Up to
$10,000 per year ($20,000 for married filing jointly) for contributions to Oklahoma’s 529 plan. - Quality jobs act: Tax credits for businesses creating qualifying jobs in Oklahoma.
Key Takeaways
- Oklahoma’s top income tax rate of 4.75% is moderate, and the state does not tax Social Security benefits
- Combined sales tax rates averaging ~8.98% are above the national average, with groceries now partially exempt (state portion removed)
- Property taxes are below average at ~0.86%, with homestead protections capping annual assessment increases at 3%
- The retirement income exclusion of ~$10,000 per person adds to Oklahoma’s appeal for retirees
- No state estate or inheritance tax
Next Steps
- Compare Oklahoma to other states at State Income Tax Comparison: All 50 States Ranked
- Understand your federal obligation with the Federal Income Tax Guide 2026
- Make sure you claim everything you can — Tax Deductions You’re Probably Missing
- Ready to file? See How to File Your Taxes Step by Step
Tax information is for educational purposes only. Consult a licensed tax professional.