In fiscal year 2024, the federal government collected around $5.07 trillion in taxes from states. Or rather, taxes levied on residents and businesses within them. The government redistributed about $4.87 trillion back to states through Social Security, Medicaid, Medicare, SNAP benefits, education grants, and other programs. |
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But if you've been reading this newsletter for a while, you know that everything varies by state. The amounts states get from the federal government are no exception. In fact, some states get back less than they contribute.
- Thirty-eight percent of what the government collected in FY 2024 was from the nation’s four most populous states: California (15.9% of the total), Texas (8.2%), New York (7.6%), and Florida (6.4%).
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- On average, states contributed $15,000 per resident. But some less-populated states contributed more than their size would suggest. Massachusetts sent the most per person: $21,933. Nebraska followed with $21,922, then Minnesota with $21,106. Washington, DC, sent $64,427, nearly triple the amount of the highest-paying state.
- Controlling for population, Alaska and its residents received the most money per person: $24,796. Approximately one-quarter of this funding came from agreements between tribes in the state and the Indian Health Service. Virginia received the second-highest amount ($23,975 per person), and New Mexico was third ($21,481).
- Washington, DC, received more money than any state, at $89,680 per person. About 30% of this was due to contracts and grants for Amtrak and military branches operating in the district.
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- Nineteen states sent more to the federal government in total than they received. The largest differences on a per-person basis were in Nebraska ($9,531), Minnesota ($8,702), and Washington State ($7,139).
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Government assists for lower-income students |
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When it comes to government support for education, a student’s family’s income often determines eligibility. The federal government funds a range of education programs, including preschool and college tuition aid, through direct financial support and tax credits. This new video featuring USAFacts Founder Steve Ballmer examines pre-K and higher education programs. |
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- Pell Grants are the government’s largest grant program. In the 2024–25 school year, awards ranged from $740 to $7,395, depending on income, household size, and other factors. In total, 6.4 million students received $35 billion in Pell Grants in the 2023–24 school year.
- The One Big Beautiful Bill Act, passed this summer, expanded Pell eligibility to students in short-term workforce training programs. It also made students with full-ride scholarships from other sources ineligible.
- The American Opportunity Tax Credit offers up to $2,500 per student in the first four years of post-high school education. In 2024, it provided $2.5 billion in refunds. Up to $1,000 per filer is refundable annually, even if the filer doesn't owe taxes.
- Federal Work-Study provides part-time jobs to students with financial need, and the government funds up to 75% of their wages. Many jobs are on campus, but at least 7% of federal funding for work-study must go to off-campus jobs at public interest organizations. In the 2022–23 school year, Federal Work-Study gave an average of $1,655 per student.
- Early Head Start and Head Start are free programs for pregnant women and children younger than five. In 2024, a family of four had to earn $31,200 or less — close to the federal poverty line — to qualify based strictly on income. That year, over 715,000 children were enrolled in some version of Head Start. Total federal spending on the program was $12.3 billion.
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