According to a new study from personal finance website WalletHub, the Garden State ranks dead last in federal dependency. That means we rely on Washington less than any other state in the country.
And we have the sky high taxes to prove it.
How WalletHub Measured Dependency
WalletHub compared all 50 states across two factors:
- State Residents’ Dependency — how much residents get back relative to what they pay in federal taxes, plus the share of federal jobs in the workforce
- State Government’s Dependency — how much of the state’s total revenue comes from federal funding
Each state was scored on a 100-point scale, with higher scores meaning greater dependency.
New Jersey scored just 12.99 out of 100. For context, Alaska scored 79.91.
The Least Federally Dependent States
- New Jersey (score: 12.99)
- Massachusetts (13.36)
- Delaware (14.58)
- Utah (14.76)
- Kansas (16.20)
New Jersey’s Specific Rankings
NJ’s low score reflects strong performance across both dimensions:
- 49th out of 50 for State Residents’ Dependency, meaning NJ residents get back very little relative to what they send to Washington
- 44th out of 50 for State Government’s Dependency — the state budget leans heavily on its own revenue sources rather than federal aid
It also falls into a notable category in WalletHub’s correlation analysis: low federal dependency AND high taxes.
New Jersey ranks 47th for tax rates, meaning residents are paying a lot in and getting comparatively little back. Gov. Mikie Shierrill just announced her first fiscal budget for NJ so it will be interesting to see if she can tackle the high tax issue.
On the Other End of the Spectrum
Alaska topped the list with a score of 79.91. Nearly 45% of the state’s revenue comes from federal funding, and for every $1 residents pay in federal taxes, the state gets back $2.52. About 5% of Alaska’s workforce is employed by the federal government — far above the typical 1-3% seen in most states.
Kentucky came in second with a score of 77.35. For every $1 Kentuckians pay in taxes, the state receives $3.45 back in federal funding.
WalletHub notes that 40 states get less than $2 back for every tax dollar paid, making Kentucky’s return especially high. Federal funding makes up nearly 44% of Kentucky’s total revenue.
West Virginia ranked third at 75.24. Residents there receive $2.74 in federal funding for every $1 paid in taxes, federal funding accounts for nearly 42% of state revenue, and over 3.8% of the workforce holds federal jobs.
Red States vs. Blue States
This is where the data gets politically interesting.
Red states are altogether more reliant on federal funding than blue states, with an average dependency rank of 21.52 compared to 32.00 for blue states.
WalletHub based its red/blue designations on the 2024 presidential election results.
New Mexico was the only blue state in the top 10 most dependent states, coming in at number 9. The next blue state on the list was Maine at 13th.
At the other end, the least dependent states skew blue.
New Jersey ranked last in dependency, followed by fellow blue states Massachusetts and Delaware. Utah, at #4, was the least dependent red state in the country.
The tax angle makes this even more striking. WalletHub’s data shows a 34.4% correlation between federal dependency and tax rates — and the pattern cuts against a common political narrative.
Many of the most federally dependent states also have some of the lowest state tax burdens. WalletHub suggests those states can afford to keep taxes artificially low precisely because they are receiving a disproportionate amount of federal aid — funding largely paid for by higher-tax, lower-dependency states like New Jersey.
The GDP Connection
WalletHub’s data shows a clear pattern: states with lower federal dependency tend to have stronger economies. There is a 59% correlation between a state’s federal dependency and its per-capita GDP. New Jersey ranks 12th in GDP per capita nationally, placing it firmly in the “low dependency, high GDP” category alongside states like Massachusetts, New York, Washington, and California.
States with the highest dependency, by contrast, tend to rank near the bottom for GDP per capita. Mississippi ranks 50th in GDP per capita and 4th in federal dependency. West Virginia ranks 49th in GDP per capita and 3rd in dependency.
A Note on What “Least Dependent” Really Means
Being the least dependent doesn’t mean NJ receives nothing. Federal dollars still flow into the state for Medicaid, education, infrastructure, public safety, and more.
New Jersey’s FY2026 budget includes over $31 billion in federal funds. The difference is that those dollars represent a much smaller slice of the overall pie compared to other states. NJ residents are contributing far more to the federal system than they’re getting back.
As WalletHub analyst Chip Lupo put it, residents of the most dependent states effectively get several dollars back for every dollar they send to Washington. This can translate to higher-quality infrastructure, education, and public health. New Jersey residents, by and large, are not in that position.
You can view the full WalletHub rankings and methodology here.
