States With No Income Tax

As Benjamin Franklin famously said “In this world, nothing can be said to be certain, except death and taxes” According to the census bureau, states in the US are collecting over $457 billion dollars in income taxes. However not every state in the US has state income tax. Moving to a state with no income tax could be helpful in saving more of your $. These 9 states have no official state income tax.

Alaska

• Population: Approximately 733,000.
• Largest City: Anchorage.
• Known For: Stunning natural landscapes, the Northern Lights, and abundant wildlife.
• Revenue Sources: Heavily reliant on oil and gas revenues. No state sales tax, but local sales taxes can reach up to 7.5%.
• Perks: Residents receive the Permanent Fund Dividend, an annual payment to Alaska residents based on the state's oil and mineral revenues. The permanent fund divided was $1,702 in 2024
• Heads Up: The cost of living is higher than the national average and Alaska ranks as one of the highest

Florida

• Population: Over 22 million.
• Largest City: Jacksonville.
• Known For: Beaches, theme parks, and a vibrant nightlife.
• Revenue Sources: State sales tax of 6%, with local additions. Tourism significantly boosts revenue.
• Perks: No state income tax, allowing residents to keep more of their earnings.
• Heads Up: Property taxes can be higher in popular areas.

Nevada

• Population: About 3.1 million.
• Largest City: Las Vegas.
• Known For: Casinos, entertainment, and desert landscapes.
• Revenue Sources: State sales tax of 6.85%, with local increases. Gaming and tourism are major contributors.
• Perks: No state income tax, benefiting residents' take-home pay.
• Heads Up: Sales taxes are among the highest in the U.S.

New Hampshire

• Population: Approximately 1.4 million.
• Largest City: Manchester.
• Known For: Autumn foliage, quaint towns, and no general sales tax.
• Revenue Sources: Relies on property taxes, which are relatively high.
• Perks: No tax on earned income or general sales tax.
• Heads Up: Investment income is taxed.

South Dakota

• Population: Around 900,000.
• Largest City: Sioux Falls.
• Known For: Mount Rushmore and expansive prairies.
• Revenue Sources: State sales tax of 4.2%, with local additions. Tourism and agriculture are key sectors.
• Perks: Generally low property taxes.
• Heads Up: Healthcare costs in Alaska are above the national average

Tennessee

• Population: Approximately 7 million.
• Largest City: Nashville.
• Known For: Country music and the Great Smoky Mountains.
• Revenue Sources: State sales tax of 7%, plus local taxes. Phased out tax on interest and dividends by 2021.
• Perks: No state income tax on wages and salaries.
• Heads Up: High combined sales tax rates.

Texas

• Population: Over 30 million.
• Largest City: Houston.
• Known For: Diverse culture, BBQ, and the Alamo.
• Revenue Sources: State sales tax of 6.25%, with local additions up to 2%. Significant revenue from oil and gas.
• Perks: No state income tax, benefiting earners.
• Heads Up: Property taxes are notably high. One of the highest average in the nation

Washington

• Population: Around 7.7 million.
• Largest City: Seattle.
• Known For: Tech industry, coffee culture, and scenic coastlines.
• Revenue Sources: State sales tax of 6.5%, with local increases. Imposes a business and occupation tax on gross receipts.
• Perks: No state income tax, appealing to high earners.
• Heads Up: Washington has a 7% long term capital gains tax

Wyoming

• Population: Approximately 580,000.
• Largest City: Cheyenne.
• Known For: Yellowstone National Park and cowboy culture.
• Revenue Sources: Severance taxes from minerals like coal, oil, and natural gas. State sales tax of 4%, with local additions.
• Perks: Low property taxes and affordable living costs.
• Heads Up: Wyoming has some of the highest monthly energy costs in the nation

The Bottom Line: Living in a state with no income tax sounds sweet, but be aware of other taxes like sales and property taxes that might be higher to compensate. Always consider the full tax picture and how it aligns with your lifestyle.

For more detailed info, check out the Tax Foundation's 2024 report.

Note: Tax laws can change, so consult with a tax professional or official state resources for the latest updates.