This sparsely populated red state has quietly risen to the top of America's state financial rankings.

North Dakota ranks first in Truth in Accounting's state finances list, with $72,300 in taxpayer surplus, while 24 states cannot cover all their bills.

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Of the 50 US states, 24 do not have enough money to pay their bills. Meanwhile, one under-the-radar red state stands out from the rest, according to a new analysis of state finances.

North Dakota actually ranked first in the 2026 Accounting Fiscal Status Report, ending fiscal 2025 with $21 billion more than it needed to pay the state's bills. The fiscal cushion gave North Dakota the highest "taxpayer surplus" in the nation at $72,300.

The taxpayer surplus figure doesn't mean how much money a state's residents get in their pockets at the end of the year — it represents each taxpayer's share of the state's surplus, based on the group's method.

The gap between states with surpluses versus those with heavy burdens is especially important when the economy weakens. States with stronger balance sheets have more room to weather recessions, maintain public services and meet pension obligations, while states with large unfunded liabilities can face tougher choices about taxes, spending and borrowing if revenues fall.

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North Dakota's finances The position was bolstered by the Legacy Fund, a state investment fund built with oil tax revenue.

Although oil, gas and coal tax revenues have declined amid lower energy prices, strong investment revenues and federal financial aid income have helped offset the decline, according to the report.

North Dakota is followed by Alaska, Wyoming, Utah and Tennessee. The five states all had taxpayer surpluses, ranging from $11,400 in Tennessee to $72,300 in North Dakota. A handful of government fiscal positions are in stark contrast to nearly half the country.

The report showed that 24 states do not have enough assets to cover their financial obligations.

New Jersey ranks last with a $162.3 billion deficit. Truth in Accounting translates that gap into a $45,800 "taxpayer burden," the highest in the nation. Connecticut ranked 49th, followed by Illinois, Massachusetts and California.

The bottom five states had taxpayer burdens ranging from $16,000 in California to $45,800 in New Jersey.

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Long-term pension obligations are a major source of pressure on government finances.

Nationwide, states had $775 billion in unfunded pension obligations and $490 billion in unfunded retiree health care obligations in fiscal year 2025, according to the report.

Despite these shortfalls, most states improved financially in 2025. Strong pension investment returns boosted assets and helped reduce unfunded pension liabilities, although Truth in Accounting warned that those gains could reverse as markets tumble.

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Amanda Macias covers the intersection of business, economics, and politics, focusing on how policy decisions shape markets, jobs, and American workers.