There are 9 U.S. states that do not levy a tax on individual wage income: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. That is the short answer to which states have no income tax. The longer answer is that a state without an income tax still has to pay for roads, schools and courts, so it raises the money somewhere else, and where it does so decides whether living there is actually cheaper. This page lists each state, what it taxes instead, and where those figures come from.
States with no income tax, and what each taxes instead
| State | State sales tax | Highest combined sales tax | Property tax effective rate | Other taxes on individuals |
|---|---|---|---|---|
| Alaska | No state sales tax | — | 0.936% | — |
| Florida | 6% | — | 0.779% | — |
| Nevada | 6.85% | — | 0.503% | A Commerce Tax on businesses above a gross revenue threshold, not on individuals. |
| New Hampshire | No state sales tax | — | 1.503% | Its tax on interest and dividends was repealed for taxable periods beginning after December 31, 2024. |
| South Dakota | 4.2% | — | 0.997% | — |
| Tennessee | 7% | — | 0.52% | Its Hall tax on interest and dividends was repealed for tax periods beginning January 1, 2021. |
| Texas | 6.25% | 8.25% | 1.402% | — |
| Washington | 6.5% | 10.7% | 0.754% | A 7% excise tax on long-term capital gains (9.9% on gains above $1,000,000), and from January 1, 2028 a 9.9% tax on income above $1,000,000. |
| Wyoming | 4% | — | 0.53% | — |
Property tax effective rate: state aggregate real estate taxes paid divided by aggregate home value, U.S. Census Bureau ACS 2024 5-year. A dash in the combined column means no state-published maximum is stored for that state.
The sales tax column is the statewide rate only. Cities and counties add their own on top in most of these states, and the combined column shows the highest combined rate where a state publishes one. Federal income tax and FICA still apply in every one of these states.
Interest, dividends and capital gains: the catches
New Hampshire now counts. Its Interest and Dividends tax, the last tax the state levied on individual income, was repealed for taxable periods beginning after December 31, 2024, according to the New Hampshire Department of Revenue Administration. Lists written before 2025 show one fewer state for that reason.
Washington is leaving the list. Washington has no tax on wages, but it already taxes long-term capital gains at 7%, rising to 9.9% on the highest gains. In March 2026 it also enacted a 9.9% tax on individual income above a $1,000,000 standard deduction, combined rather than doubled for married couples and registered domestic partners. The tax applies from January 1, 2028, and the first returns are due in 2029, according to the Washington Department of Revenue. Through 2027 Washington still has no tax on wages, and from 2028 the new tax reaches only income above the deduction.
Tennessee used to tax interest and dividends through its Hall tax, which was repealed for tax periods beginning January 1, 2021, according to the Tennessee Department of Revenue.
What the states tax instead
Sales tax. The highest statewide rate among these states is Tennessee‘s 7%. Alaska and New Hampshire levy no general state sales tax. In states where cities and counties add their own tax, the local rate is added to the state rate, so the figure on a receipt depends on where you shop. Use the sales tax calculator for a specific purchase.
Property tax. Among these states the effective property tax rate, meaning taxes paid as a share of home value, is highest in New Hampshire at 1.503% and lowest in Nevada at 0.503%. The rates come from Census Bureau data on real estate taxes paid and home values, so they describe the typical homeowner, not the bill on any one house. The property tax calculator estimates it for a specific home.
Business and other taxes. Nevada, for example, levies a Commerce Tax on businesses above a gross revenue threshold, according to the Nevada Department of Taxation. These taxes fall on businesses first, so an employee or retiree rarely sees them as a line on a return.
Do the savings hold up?
Skipping a state income tax is only a saving if the replacement taxes cost you less. That depends on three things.
Whether you own a home. A renter pays property tax only indirectly, through rent. An owner in a high-property-tax state can give back much of the income tax saved.
How much you spend. Sales tax scales with spending, so a household that spends most of its income feels it more than one that saves most of it.
How much you earn. The income tax saved grows with income, which is why the largest absolute savings go to high earners. Retirees with large taxable distributions can also benefit, because the state does not tax them.
To put your own numbers on it, use the moving states tax calculator, the state tax ranking tool, or the full tax by state table of every state’s income tax. If you work in one state and live in another, you can still owe income tax to the state where you earn the income, so check that state’s rules before assuming the move removes the tax.