taxes

These states have no income tax

States with no income tax | Rocky Grimes/Shutterstock.com

Alaska | Sorin Colac/Shutterstock.com

Alaska

The Last Frontier doesn't have a state sales or income tax, though the governor has proposed both taxes to help close the state's budget deficit. State lawmakers have resisted. Alaska does allow some municipalities to impose local sales taxes.

Sources: Tax Foundation and individual state tax departments


Florida | fotomak/Shutterstock.com

Florida

In the absence of an income tax, the Sunshine State relies heavily on sales taxes. Local government costs are covered by property taxes.

Florida is a popular tax and retirement haven. If you're considering buying a second home, check out mortgage rates at Bankrate.

Sources: Tax Foundation and individual state tax departments


Nevada | Kawin Towe/Shutterstock.com

Nevada

No need for an income tax in Nevada. The Silver State's treasury collects half its revenue from sales taxes and fees, much of it gambling related.

Sources: Tax Foundation and individual state tax departments


South Dakota | Melanie Hobson/Shutterstock.com

South Dakota

To cover costs not paid for by an income tax, South Dakota's Department of Revenue Special Tax Division collects a variety of state taxes, including cigarette excise, bank franchise and alcoholic beverage taxes, and even a license fee for coin laundromats.

Sources: Tax Foundation and individual state tax departments


Texas | William Silver/Shutterstock.com

Texas

The Lone Star State depends on a state sales tax, and local jurisdictions collect additional sales tax and property taxes to help pay government bills. State and local taxes combined average nearly 8.2 percent in Texas.

Sources: Tax Foundation and individual state tax departments


Washington | Pierre Leclerc/Shutterstock.com

Washington

The Evergreen State remains in the no-income-tax fold, but it ranks fifth highest in the nation for sales taxes. A 6.5 percent state sales tax and an average local rate of 2.42 percent combine for an average sales tax of nearly 9 percent.

Sources: Tax Foundation and individual state tax departments


Wyoming | Galyna Andrushko/Shutterstock.com

Wyoming

In addition to no personal state income tax, the Cowboy State also forgoes a corporate income tax.

Sources: Tax Foundation and individual state tax departments


New Hampshire | Jon Bilous/Shutterstock.com

New Hampshire

The Granite State doesn't tax wage income, but it does collect a 5 percent tax on income and dividends that exceed $2,400 per individual annually. Some exemptions are available for elderly and blind residents.

Sources: Tax Foundation and individual state tax departments


Tennessee | Rushvol/Shutterstock.com

Tennessee

Volunteer State residents don't have to file a return to pay taxes on wages. Tennessee does tax dividends and interest, but that tax on investment income is being phased out and will be gone in 2022.

Moving to a state with no income tax? Check out mortgage rates at Bankrate.

Sources: Tax Foundation and individual state tax departments

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