Which states have no state income tax?

Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming don't tax wages or other personal income broadly. New Hampshire doesn't tax wages, and it ended its tax on interest and dividends starting with 2025. Washington does tax certain long-term capital gains.

Do I still pay federal income tax in a no-income-tax state?

Yes. Federal income tax, Social Security, and Medicare apply everywhere in the U.S. Only the state income tax line on your paycheck disappears.

If I work remotely for a company in another state, which state taxes me?

Generally the state where you physically do the work, plus your state of residence if different, with a credit to avoid double taxation. A few states, such as New York, can tax nonresidents who work remotely for an employer there for their own convenience. Rules vary, so check both states' guidance.

Are no-income-tax states always cheaper overall?

Not necessarily. They often rely more on sales taxes, property taxes, or fees. Depending on your income, spending, and whether you own a home, your total state and local tax bill can be similar to, or even higher than, a state with a moderate income tax.

States With No Income Tax: What You Really Save

Key takeaways

9 states don’t tax wages: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming.
On a $75,000 salary, skipping state income tax is worth roughly $2,303 to $3,568 a year compared with the income-tax states in our example.
No income tax doesn’t mean low taxes. These states lean more on sales, property, and other taxes.
Weigh the whole cost of living, especially housing, before moving for taxes alone.

Living in a state without an income tax is one of the few ways to raise your take-home pay without a raise. How much it’s worth depends on your income and on what the state taxes instead.

The states that don’t tax wages

A few details:

Washington doesn’t tax wages, but it taxes certain long-term capital gains above a large annual exemption, and it has payroll deductions for paid family and medical leave and the WA Cares long-term care fund.
New Hampshire never taxed wages, and it ended its tax on interest and dividends starting with the 2025 tax year.
Tennessee phased out its tax on investment income (the Hall tax) in 2021.
Alaska has no statewide sales tax either, though many localities charge one, and residents may receive an annual Permanent Fund Dividend.

What it’s worth on your paycheck

Here’s take-home pay on a $75,000 salary for a single filer paid biweekly, using 2026 withholding rules, in Texas versus several income-tax states:

State	State income tax	Other state payroll taxes	Annual take-home pay
Texas	$0	$0	$61,593
Washington	$0	$1,040	$60,552
Pennsylvania	$2,303	$0	$59,290
Illinois	$3,568	$0	$58,025
North Carolina	$2,484	$0	$59,109
California	$2,775	$975	$57,843
New York	$3,453	$355	$57,784

Figures exclude local income taxes, such as New York City’s or Pennsylvania’s local earned income taxes, which would widen the gap. At higher incomes the difference grows too, since most income-tax states have progressive brackets.

How these states make up the revenue

States still need to fund schools, roads, and services. Without an income tax, they usually rely more on:

Sales taxes. Several no-income-tax states have some of the highest combined state and local sales tax rates in the country. That hits households that spend most of what they earn.
Property taxes. Texas and New Hampshire are known for high property tax rates, which show up in rent as well as for owners. Our mortgage calculator shows how property tax changes a housing payment.
Industry-specific taxes. Severance taxes on oil and gas (Alaska, Wyoming, Texas) and gaming and tourism taxes (Nevada, Florida) carry part of the load.
Fees and other taxes, such as Washington’s business and occupation tax, which is built into prices.

Whether you come out ahead depends on your mix. A high earner who rents and saves a lot often gains the most. A homeowner with a modest income and high spending may gain little or nothing.

Before you move for taxes

Compare total cost of living. Housing usually dwarfs the income tax difference.
Check how your old state treats you. Some states look closely at whether you’ve really changed domicile, especially for high earners and retirees. Keep records of where you live and work.
Remote work rules. If your employer is in another state, you may still owe that state’s tax in some cases.
Retirement income. Some income-tax states exempt Social Security or pension income anyway, which narrows the gap for retirees.

For how federal tax on the same salary works, see marginal vs. effective tax rate and FICA taxes explained.

Disclaimer: This guide is general education, not financial, tax, or legal advice. Examples use round, hypothetical numbers; your results depend on your own loan terms, taxes, and circumstances. See oureditorial policy for how guides are written and corrected.