How Delaware State Taxes Work
Delaware runs a progressive income tax with seven brackets, and the first one is 0 percent, so your first $2,000 of taxable income is tax free. From there the rates climb through 2.2, 3.9, 4.8, 5.2 and 5.55 percent, with the top rate of 6.6 percent applying to taxable income above $60,000. The same brackets apply whether you file single or jointly; what changes for couples is the standard deduction, which doubles from $3,250 to $6,500. Delaware also gives a $110 personal credit per exemption that comes straight off the tax. Run a $54,000 single income through it and the Delaware tax is about $2,320, an effective 4.3 percent of gross pay.
One thing Delaware doesn't have is a sales tax, at the state or local level, which is a genuine offset to that income tax when you compare it to Pennsylvania, Maryland or New Jersey next door. Every deduction, state and federal, is itemized on your pay stub, and the difference between one check and your running totals is explained in our guide to what is on a pay stub.
The Wilmington City Wage Tax
Delaware has exactly one local income tax, and it's Wilmington's. The city charges a 1.25 percent wage tax, and the rule that catches people out is that it's based on where you work as well as where you live. Live in Wilmington and you pay it; commute into a Wilmington job from Newark or Dover and you pay it too. On a $54,000 salary that's about $675 a year, roughly $56 a month, that a worker in the rest of Delaware simply doesn't have on their stub. It's the single biggest reason two Delawareans on identical salaries can take home different amounts, and it's the line most paycheck calculators leave out entirely.
What Gets Taken Out of Your Delaware Paycheck
Every Delaware paycheck carries federal income tax, Social Security at 6.2 percent and Medicare at 1.45 percent, the same FICA math as everywhere else, with Social Security capped at the $184,500 wage base for 2026. Delaware state tax rides on top at an effective 3.5 to 4.5 percent for most middle incomes, plus the Wilmington wage tax if it applies. If your employer offers health insurance or a 401(k), those pre-tax deductions come out before taxes are figured, which lowers every line that follows.
Hourly Pay and the 2026 Minimum Wage
An hourly wage just gets annualized first. Delaware's minimum wage is $15.00 an hour in 2026, having reached that level on January 1, 2025 as the last step of a phase-in under Senate Bill 15, and it's well above the federal $7.25 floor. At $20 an hour, 40 hours a week is $800, about $41,600 a year, and a single filer outside Wilmington at that rate with biweekly checks nets about $1,307 per check. Overtime past 40 hours pays time and a half, and every extra dollar runs through the same tax lines.
How this estimate is built: it applies the 2026 IRS federal brackets and the Delaware Division of Revenue rate schedule, standard deduction and $110 personal credit, plus the Wilmington 1.25 percent wage tax where it applies. It assumes standard deductions, a single job and no other credits, so treat it as a close estimate rather than a withholding guarantee. Overtime is withheld like normal wages; the 2026 federal deduction of up to $12,500 of overtime premium is claimed on your federal return, explained in our guide to
overtime on the W-2 and code TT.
