Personal income tax
The Tennessee income tax does not apply to salaries and wages, but most income from stocks, bonds and notes receivable is taxable at a flat rate of 6 percent.
The first $1,250 in taxable income received by a single filer is exempt. The first $2,500 in taxable income received by a joint filer is exempt. Persons older than 65 and who have total income of less than $26,200 for a single filer or $37,000 for a joint filer also are exempt.
Tennessee tax returns are due April 15 or the next business day if that date falls on a weekend or holiday.
Sales taxes
Generally, the state's sales and use tax rate is 7 percent.
Food is taxed at 5.25 percent, but candy, dietary supplements and prepared food are taxed at the increased 7 percent rate.
Local sales taxes also are collected and those rates vary from 1.5 percent to 2.75 percent.
More details are available at the state's sales and use tax Web page, as well as the Sales and Use Tax Compliance Agreement.
Personal and real property taxes
Tennessee does not have a homestead exemption. However, there is a property tax relief program for the elderly, disabled and/or veterans. Program requirements may be found at the Tennessee Comptroller's website.
Assessments are based on a percentage of fair market value of the property as of each Jan. 1. The required percentage varies according to statutory classifications based on actual or potential use:
- Residential property at 25 percent.
- Farm property at 25 percent.
- Commercial and industrial property at 40 percent.
- Public utility property at 55 percent.
- Business personal property at 30 percent.
Tax rates are expressed as an amount per $100 of assessed value and are set by the governing body of the county or city. The delinquency date is generally March 1 following the tax year, but some cities have earlier delinquency dates by private act or local ordinance.
Real estate assessment data by county can be found on the Comptroller's website.
For more information, contact your local assessor of property.
Inheritance and estate taxes
Tennessee imposes an inheritance tax ranging from 5.5 percent to 9.5 percent on decedents' estates that exceed maximum single exemption limits. For 2012, the exemption is $1 million. In 2013, the exemption is $1.25 million.
Because of the phaseout of the federal estate tax credit, Tennessee's estate tax is not imposed on estates of persons who died in 2005 or later.
Other Tennessee tax facts
Volunteer State taxpayers can file state income tax returns, request an extension for filing taxes and make estimated tax payments electronically at Tennessee Individual Income Tax Online.
Tennessee imposes a tax on "bona fide coin-operated amusement machines," which are any "coin- or token-operated game, machine or device, which as a result of depositing a coin, token or other object, automatically or through some mechanical or electronic operation involving skill, chance or a combination thereof, affords music, amusement or entertainment without vending any merchandise."