States With No Income Tax (2026 List)
For many workers the biggest paycheck decision is not a 401(k) election or a W-4 line. It is where they live. State income tax can take anywhere from nothing to more than 10% of pay, and nine states do not tax wages at all. This guide lists them, explains the exceptions that trip people up and shows what the difference is worth in real dollars.
The nine states with no state tax on wages
| State | Notes | Avg. combined sales tax |
|---|---|---|
| Alaska | No state income or state sales tax; local sales taxes exist in many areas. | 1.82% |
| Florida | No personal income tax; strong homestead protections; high insurance costs in many areas. | 6.98% |
| Nevada | No personal income tax; relies on sales and gaming taxes. | 8.24% |
| New Hampshire | No wage tax. The state’s tax on interest and dividends was fully repealed starting in 2025. | 0.00% |
| South Dakota | No personal income tax; low overall tax structure. | 6.11% |
| Tennessee | No wage tax; the Hall tax on investment income was repealed in 2021. Sales tax is among the highest in the country. | 9.61% |
| Texas | No personal income tax; local property taxes are high. | 8.20% |
| Washington | No wage tax, but a capital gains excise tax on large long-term gains, plus WA Cares and Paid Family and Medical Leave payroll premiums. | 9.57% |
| Wyoming | No personal income tax; low tax burden overall. | 5.39% |
The table shows the average combined state and local sales tax from our sales tax tool, because sales tax is the most common way no-income-tax states raise revenue. Alaska has no state sales tax but allows local ones, so its combined average is mostly local.
The catches
Washington
Washington does not tax wages. It does levy a capital gains excise tax on certain large long-term gains, and it requires employees to contribute to the WA Cares long-term care program (0.58% of wages) and to Paid Family and Medical Leave (premiums shared with employers). Those payroll premiums reduce your net pay even though there is no income tax, and our calculator includes them.
Tennessee and New Hampshire
Both states once taxed investment income (Tennessee’s Hall tax, New Hampshire’s interest and dividends tax) but have repealed those taxes. Wages were never taxed in either state. Tennessee relies heavily on sales tax, with one of the highest combined rates in the nation.
Living in one state and working in another
A resident of Texas who commutes into Oklahoma, or a New Hampshire resident who works in Massachusetts, may owe income tax to the state where the work is performed. The state of residence generally does not tax the wages, so the no-income-tax benefit disappears for those wages. Remote workers should check state rules on where income is sourced; some states tax non-residents who work for in-state employers.
Local taxes
No-income-tax states can still have local wage taxes in rare cases, but most do not. By contrast, some states that do tax income also allow cities to add their own, as in New York City, Philadelphia, many Ohio cities and parts of Maryland.
What a no-tax state is worth: a $100,000 comparison
| State | State income tax + payroll programs | Annual take-home | Monthly |
|---|---|---|---|
| Texas | $0 | $79,180 | $6,598 |
| Florida | $0 | $79,180 | $6,598 |
| Washington | $1,390 | $77,790 | $6,483 |
| California | $6,370 | $72,810 | $6,067 |
| New York | $5,303 | $73,877 | $6,156 |
| Illinois | $4,805 | $74,375 | $6,198 |
| Massachusetts | $5,240 | $73,940 | $6,162 |
At $100,000, a single worker in Texas keeps $6,370 more per year than the same worker in California. Over a decade, that is a six-figure gap. The effect grows with income: at $250,000, California’s graduated rates mean the gap is $22,270 a year. You can run your own pair of states in the state comparison tool.
What you pay instead
States have to fund schools, roads and public services somehow. Without an income tax, they lean on other taxes:
- Sales taxes. Tennessee’s average combined rate is 9.61% and Washington’s is 9.57%, versus 0% state sales tax in New Hampshire. A household that spends $50,000 a year on taxable goods pays about $1,000 more in Tennessee than it would at a 5% rate.
- Property taxes. Texas has no income tax but property taxes are among the highest in the nation, which matters for homeowners.
- Excise and severance taxes. Alaska and Wyoming draw revenue from natural resources, which lowers the burden on residents.
- Tourism and gaming taxes. Nevada and Florida collect from visitors, which spreads some costs beyond residents.
Who benefits most from a no-tax state?
Because state income taxes are usually a percentage of income, the savings rise with earnings. A single worker earning $50,000 in Illinois pays a flat 4.95% rate on income after exemptions, which is about $2,330. In a no-tax state that disappears. A professional earning $200,000 in New York or California is paying five figures a year more than a peer in Texas or Florida. Retirees with taxable pension or IRA distributions can benefit too, although several high-tax states exempt some retirement income. Entrepreneurs and self-employed workers feel it as well because the state tax is calculated on net profit; the self-employment tax calculator includes state estimates.
Lower earners benefit least in dollar terms and may even come out behind, because sales taxes fall on everyone who buys goods, and spending is a larger share of a modest income. Several no-income-tax states also tax food or services in ways that weigh more on low-income households. That is why tax-burden studies, which measure state and local taxes as a share of income, do not always rank no-income-tax states at the very bottom.
A note on state tax rates over time
State tax laws change. Several states have cut rates or moved to flat taxes in recent years, and a few ballot measures and legislative proposals continue to float new taxes on high earners in states that currently have none. A decision with a ten-year horizon should consider that today’s structure is not guaranteed to last. Before a move, check the current rules with the state’s department of revenue, and use our sources and methodology notes to see which parameters our calculators use and when they were last updated.
Frequently asked scenarios
What if I work remotely for an employer in another state?
The general rule is that wages are taxed by the state where you physically perform the work, and by your state of residence if it taxes residents on all income, with a credit to avoid double taxation. A few states apply a "convenience of the employer" rule that taxes remote workers as if they were working at the employer’s office. If you live in Florida but work remotely for a New York company, New York may still claim you owe tax on that income in certain circumstances. Always check the rules in both states before you assume that moving eliminates your state income tax.
What about military pay and retirement income?
Military members generally keep their home-of-record state for tax purposes under federal law, regardless of where they are stationed. Many states exempt some or all military pay and retirement income from tax, so the no-tax-state advantage is smaller for these groups than for civilian wage earners.
Do no-tax states have lower take-home pay at the same job?
Not necessarily, and it is hard to generalize. Wages in high-cost, high-tax states are often higher to compensate for living costs, while wages in no-tax states are sometimes lower. The only sensible comparison is between actual offers, which is why the state comparison tool lets you enter a different salary for each side.
How to decide whether a move saves money
- Compare after-tax pay, using the same salary in both states. Use the paycheck calculator for each.
- Add housing cost. Rent or mortgage differences often exceed tax differences.
- Estimate sales and property tax. A homeowner in a high property-tax state should include that bill.
- Consider job market and salary. A role that pays $20,000 more in California may leave you better off than the same role in Texas, even after the tax gap.
- Check residency rules. Some states, such as California and New York, use residency tests that can follow you after a move; keep records showing where you actually live.
The state pages list the rate structure and a sample paycheck for every state and DC, which gives you a quick view of the practical differences.