New Jersey ranks last in federal dependency in new national study
The analysis compared all 50 states in key metrics like return on paid taxes, federal jobs and federal funding as a share of the state revenue
Top Stories
New Jersey remains the least federally dependent state in the nation, according to a new study.
WalletHub released its 2026 report ranking the most and least federally dependent states. Alaska, Kentucky and West Virginia placed at the top of the list as the most reliant on federal funding.
The analysis compared all 50 states using metrics that included return on paid taxes, federal jobs and the share of federal funding in state revenue. Researchers found that federal aid plays a different role in every state.
New Jersey ranked 50th in federal dependency. The report says that despite a high cost of living and significant state taxes, residents see the lowest return on the federal tax dollars they pay.
Alaska was ranked the most dependent state, receiving nearly 45% of its total revenue from the federal government. Experts say that high reliance is tied to extreme infrastructure costs and the state's role in national defense.
Kentucky showed a high return on tax dollars. The study found the state receives $3.45 in federal funding for every $1 Kentuckians pay in federal taxes.
WalletHub analyst Chip Lupo said that residents in highly dependent states often see several dollars back for every dollar paid. He said that money frequently supports infrastructure, education and public health programs.
The data also pointed to a connection between a state's economic health and its level of dependency. Many states with high GDP per capita, including New Jersey, Massachusetts and New York, ranked among the least dependent.
States with lower GDPs often relied more heavily on intergovernmental aid.
For New Jersey, the data shows the state receives the smallest return compared with what residents contribute to the federal government.
