New York taxes federal AGI from 3.9% up to 10.9%, less a standard deduction of $8,000 single or $16,050 filing jointly, and gives no exemption for yourself. Neither federal deduction reduces New York tax. If you live in New York City or Yonkers you also owe a separate local income tax, which this calculator does not include — for a tipped worker in the city that is a large part of the answer.
What it means on a real paycheck
Take a single filer earning $50,000 a year, $8,000 of it in tips. Against the same person with no tips to declare, the federal deduction is worth $960.
In New York it is worth nothing extra. The state bill is identical either way, so $960 is the whole of it.
How New York works out the tax
New York charges graduated rates from 3.9% up to 10.9%, across 9 bands, after a standard deduction of $8,000 single or $16,050 filing jointly. It begins from your federal adjusted gross income and applies its own reliefs from there.