Quick answer: the states with no broad state income tax on wages are Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
That does not mean your paycheck is tax-free. Employees in no-income-tax states still pay federal income tax, Social Security tax, Medicare tax, and any voluntary deductions such as health insurance, retirement contributions, or other benefits. The main difference is that the state income tax withholding line is usually zero for regular wage income.
Use this guide to understand which states have no income tax, how much that can matter for take-home pay, and why a no-income-tax state is not automatically the lowest-cost place to live.
States with no income tax
For regular wage and salary income, these are the nine no-income-tax states:
| State | Code | What this means for wages | Important note |
|---|---|---|---|
| Alaska | AK | No state income tax on wages | No statewide sales tax, but some local sales taxes may apply. |
| Florida | FL | No state income tax on wages | Popular for retirees and remote workers, but housing, insurance, property taxes, and sales taxes still matter. |
| Nevada | NV | No state income tax on wages | State revenue relies more heavily on sales, tourism, and business-related taxes. |
| New Hampshire | NH | No state income tax on wages | The former interest and dividends tax has been repealed, but property taxes can be a major factor. |
| South Dakota | SD | No state income tax on wages | Often viewed as tax-friendly, but total cost depends on property, sales, and local costs. |
| Tennessee | TN | No state income tax on wages | The Hall income tax has been repealed; sales taxes can be relatively important. |
| Texas | TX | No state income tax on wages | Property taxes can be significant, especially for homeowners. |
| Washington | WA | No broad state income tax on wages | Washington has separate rules for certain high-value capital gains and other payroll-related premiums may apply. |
| Wyoming | WY | No state income tax on wages | Often attractive from a tax perspective, but income, housing, and local costs still drive the real answer. |
The most important phrase is on wages. This article focuses on individual income tax for employees. It does not cover every business tax, excise tax, property tax, estate tax, paid leave premium, unemployment insurance rule, or local charge that may appear in a full tax picture.
What no state income tax means for your paycheck
If you earn the same salary in a no-income-tax state, your take-home pay is often higher than it would be in a state with an income tax. That is because there is usually no state income tax withholding from each paycheck.
However, three major items still reduce your paycheck:
- Federal income tax, based on your taxable income, filing status, deductions, credits, and withholding choices.
- FICA taxes, which include Social Security and Medicare taxes.
- Pre-tax and after-tax deductions, such as health insurance, 401(k) contributions, HSA contributions, commuter benefits, garnishments, or other payroll deductions.
In other words, moving from California or New York to Texas or Florida may reduce state income tax, but it does not remove federal tax or payroll tax from your paycheck.
To estimate your actual take-home pay, use the PaycheckNet Payroll Calculator. It lets you enter your pay frequency, state, filing status, and deductions without loading the full calculator inside this article.
Compare no-income-tax states against other states
The easiest way to understand the paycheck impact is to compare the same salary, filing status, and deductions across multiple states. A no-income-tax state will usually look better on the paycheck itself, but the total financial benefit depends on where you are comparing from.
For example, a worker comparing Texas, Florida, and Washington will mostly see federal and FICA withholding in all three states. A worker comparing Texas against California, New York, Oregon, or Minnesota may see a larger paycheck difference because those states also apply individual income tax.
For a side-by-side estimate, use the Tax Comparison Calculator. It is the better place to compare different states, salaries, filing statuses, or job-offer scenarios.
No income tax does not mean low total tax
A common mistake is to assume that no state income tax automatically means the state is cheap. States still need revenue, so they may rely more on other taxes and fees. Depending on your situation, those other costs can offset some or all of the paycheck benefit.
Property taxes
Property taxes can matter more than income tax for homeowners. Texas and New Hampshire are good examples of states where the absence of state income tax does not mean homeowners should ignore property tax. If you rent, property taxes may still affect you indirectly through rent levels.
Sales and excise taxes
Sales taxes affect what you spend, not what you earn. A household that spends most of its income may feel sales tax more than a household that saves a larger share. Tennessee, Nevada, Washington, and Texas are examples where sales tax can be an important part of the total tax picture.
Housing, insurance, and cost of living
Tax is only one part of affordability. Florida may look attractive from an income tax perspective, but homeowners insurance, rent, property values, and local costs can change the real answer. A higher paycheck does not always translate into more money left over every month.
Special rules and non-wage taxes
Some states have special taxes that are not the same as a broad income tax on wages. Washington is the most important example in this group because it does not have a broad state income tax on wages, but it does have a capital gains tax on certain high-value long-term capital gains. New Hampshire is also worth noting because it previously taxed interest and dividends, but that tax has been repealed.
Federal taxes still apply in every state
No state income tax does not change the federal tax system. A worker earning $100,000 in Florida still has federal taxable income. The same is true in Texas, Washington, Tennessee, Nevada, South Dakota, Wyoming, Alaska, and New Hampshire.
Your federal taxable income depends on your filing status, standard deduction or itemized deductions, pre-tax deductions, credits, and other income. That is why two people with the same salary can have different take-home pay.
| Tax Rate | Single | Married (Joint) | Married (Separate) | Head of Household |
|---|---|---|---|---|
| 10% | Up to $12,400 | Up to $24,800 | Up to $12,400 | Up to $17,700 |
| 12% | $12,400 – $50,400 | $24,800 – $100,800 | $12,400 – $50,400 | $17,700 – $67,450 |
| 22% | $50,400 – $105,700 | $100,800 – $211,400 | $50,400 – $105,700 | $67,450 – $105,700 |
| 24% | $105,700 – $201,775 | $211,400 – $403,550 | $105,700 – $201,775 | $105,700 – $201,775 |
| 32% | $201,775 – $256,225 | $403,550 – $512,450 | $201,775 – $256,225 | $201,775 – $256,225 |
| 35% | $256,225 – $640,600 | $512,450 – $768,600 | $256,225 – $384,300 | $256,225 – $640,600 |
| 37% | Over $640,600 | Over $768,600 | Over $384,300 | Over $640,600 |
Brackets apply to federal taxable income — income after deductions and exemptions, not your gross salary. The U.S. system is progressive: each rate applies only to the income inside its own bracket, never to your whole income.
FICA taxes also still apply
FICA is separate from federal income tax and state income tax. Employees generally pay Social Security tax and Medicare tax through payroll withholding, even in states with no income tax. Employers also pay a matching share, and self-employed workers generally handle the employer and employee portions through self-employment tax rules.
| Employee Rate | Wage Limit | |
|---|---|---|
| Social Security | 6.2% | First $184,500 of wages |
| Medicare | 1.45% | All wages (no cap) |
| Additional Medicare | 0.9% | Wages above $200,000 (single / head of household), $250,000 (married filing jointly), $125,000 (married filing separately) |
FICA comes out of every paycheck in every state and is separate from income tax. Employers pay a matching share on top of these employee rates; self-employed workers pay both halves through self-employment tax.
Who benefits most from living in a no-income-tax state?
The biggest paycheck benefit usually goes to people who earn a relatively high wage or salary and move from a state with a meaningful income tax. The higher your income, the more state income tax you may avoid, especially if your previous state had progressive tax rates.
No-income-tax states can be especially attractive for:
- High-income W-2 employees moving from high-tax states.
- Remote workers who can legally work from a no-income-tax state without creating tax complications in another state.
- Retirees who want to avoid state tax on pensions, IRA withdrawals, 401(k) withdrawals, and Social Security benefits.
- Business owners who can structure their operations in a tax-efficient way, while still considering business taxes, nexus, payroll, and state filing requirements.
The benefit may be smaller for lower-income workers, renters in expensive markets, people with high housing or insurance costs, and households that spend heavily in states with higher sales taxes.
Which no-income-tax state is best?
There is no single best no-income-tax state for everyone. The right answer depends on whether you are optimizing for paycheck size, housing costs, retirement income, job opportunities, climate, schools, property taxes, or long-term wealth planning.
Here is a practical way to compare them:
- For paycheck impact: estimate your gross salary, pay frequency, filing status, and deductions in the payroll calculator.
- For state comparisons: compare the same income across multiple states in the tax comparison calculator.
- For homeowners: estimate property tax, insurance, utilities, and maintenance costs.
- For renters: compare rent, commuting costs, sales tax, and local cost of living.
- For retirees: compare property tax relief, healthcare access, estate taxes, retirement-income treatment, and housing costs.
- For investors: check whether the state has special rules for capital gains, dividends, estate taxes, or business income.
FAQ: states with no income tax
How many states have no income tax?
Nine states have no broad state income tax on wages: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
Do you pay federal tax in states with no income tax?
Yes. Federal income tax applies regardless of which state you live in. No state income tax only removes the state income tax portion; it does not remove federal income tax, Social Security tax, or Medicare tax.
Does no income tax mean no payroll tax?
No. Payroll tax is broader than state income tax. FICA taxes still apply, and some states may have other payroll-related premiums or deductions even if they do not have a broad wage income tax.
Are retirees better off in no-income-tax states?
Often, but not always. A no-income-tax state generally does not tax retirement income at the state level, which can help retirees with pensions, IRA withdrawals, 401(k) withdrawals, and Social Security. But retirees should also compare property tax, sales tax, healthcare costs, housing costs, and estate tax rules.
Is Washington really a no-income-tax state?
For ordinary wages, Washington does not have a broad state income tax. However, Washington has a separate capital gains tax on certain high-value long-term capital gains, so investors should not treat it the same as a state with no tax on any type of investment gain.
Is New Hampshire a no-income-tax state?
Yes for wage income. New Hampshire does not tax wages, and its former interest and dividends tax has been repealed. Property taxes are often the bigger tax consideration for New Hampshire households.
Will moving to a no-income-tax state always save money?
Not always. You may save on state income tax, but the total result depends on housing, insurance, property tax, sales tax, commuting, childcare, wages, and lifestyle costs. Always compare your full monthly budget, not just the state income tax rate.
Bottom line
The nine states with no income tax on wages are Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. For paycheck purposes, that usually means no state income tax withholding, but federal income tax and FICA still apply.
The best way to decide whether a no-income-tax state is better for you is to compare your actual paycheck and your actual cost of living. Start with the payroll calculator and tax comparison calculator, then add housing, property tax, sales tax, insurance, and other local costs before making a decision.
Last reviewed: July 2026. This article is for general educational purposes and should not be treated as personal tax advice.
Leave a Reply