Nine states in the United States have no state income tax, allowing residents to keep more of their earnings. For high earners, this can mean saving thousands or even tens of thousands of dollars per year. But is moving to a no-tax state always the best financial decision? In this guide, we explore the nine no-income-tax states, compare tax savings, and help you determine which state is best for your situation.
The 9 States with No Income Tax
As of 2026, nine states have no state income tax on wages: Texas, Florida, Tennessee, Nevada, Washington, Wyoming, South Dakota, Alaska, and New Hampshire. Note that New Hampshire taxes interest and dividend income at 3%, but not wages or salaries. This makes it effectively a no-income-tax state for most workers.
No-Income-Tax States (2026)
- Texas: No income tax, but property taxes average 1.8%
- Florida: No income tax, no estate tax, moderate property taxes
- Tennessee: No income tax (eliminated in 2021)
- Nevada: No income tax, relies on tourism and sales tax
- Washington: No income tax, but high sales tax (10.4% in Seattle)
- Wyoming: No income tax, low population, energy-driven economy
- South Dakota: No income tax, low cost of living
- Alaska: No income tax, residents receive annual dividend from oil revenue
- New Hampshire: No tax on wages, but 3% tax on interest/dividends
Tax Savings Comparison
The amount you save by moving to a no-tax state depends on your current state's tax rate and your income level. On a $100,000 salary, California residents pay $9,300 in state income tax (9.3% rate), New York residents pay $6,780 (6.78% rate), and Oregon residents pay $9,900 (9.9% rate). By moving to Texas or Florida, you eliminate this entire tax burden.
For high earners, the savings are even more dramatic. On a $200,000 salary, California residents pay $26,600 in state income tax (13.3% top rate), while Texas residents pay $0. Over a 30-year career, this amounts to $798,000 in tax savings. If you invest that money at a 7% annual return, it grows to over $2.5 million by retirement.
| Income Level | CA Tax | NY Tax | TX Tax |
|---|---|---|---|
| $50,000 | $4,650 | $3,390 | $0 |
| $100,000 | $9,300 | $6,780 | $0 |
| $150,000 | $13,950 | $10,170 | $0 |
| $200,000 | $26,600 | $13,560 | $0 |
Cost of Living Considerations
While no-income-tax states save you money on taxes, they often make up revenue through other means. Texas has high property taxes (1.6-2.0% of home value), Washington has high sales taxes (10.4% in Seattle), and Alaska has a high cost of living due to its remote location. You must consider the total cost of living, not just income tax.
Housing costs vary dramatically: Texas and Tennessee have affordable housing ($1,200-$1,800/month for a 1-bedroom), while Washington and Alaska are expensive ($2,000-$2,500/month). Florida is moderate ($1,500-$2,000/month), and Nevada varies by city (Las Vegas is affordable, Reno is moderate). Always calculate your total monthly expenses before moving.
Real-World Examples
Moving from California to Texas
On a $100,000 salary, you save $9,300/year in state income tax. However, property taxes on a $300,000 home are $5,400/year in Texas vs $3,000/year in California. Net savings: $6,900/year, plus lower housing costs ($1,800 vs $2,500 rent).
Moving from New York to Florida
On a $100,000 salary, you save $6,780/year in state income tax plus $3,078/year in NYC income tax (if applicable). Total savings: $9,858/year. Florida has no estate tax, making it ideal for retirees.
Best No-Tax States for Different Lifestyles
The best no-tax state for you depends on your lifestyle, career, and priorities. For retirees, Florida is ideal: no income tax, no estate tax, warm weather, and excellent healthcare facilities. For families, Texas offers affordable housing, good schools, and a strong job market in cities like Austin, Dallas, and Houston.
For remote workers, Tennessee provides the best value: no income tax, low cost of living ($1,200-$1,500 rent), and a growing tech scene in Nashville. For tech workers, Washington offers high salaries (especially in Seattle), no income tax, and access to major employers like Amazon and Microsoft. Wyoming and South Dakota are best for those seeking low population density and outdoor recreation.
Best No-Tax State by Lifestyle
- Retirees: Florida (no estate tax, warm weather, healthcare)
- Families: Texas (affordable housing, good schools, job market)
- Remote Workers: Tennessee (low cost of living, growing tech scene)
- Tech Workers: Washington (high salaries, major employers)
- Outdoor Enthusiasts: Wyoming (low population, natural beauty)
- Entrepreneurs: Nevada (business-friendly, no corporate tax)
Key Statistics
- •9 states have no state income tax in 2026
- •California earners save $9,300/year on $100k by moving to Texas
- •Texas has no state income tax but property taxes average 1.8%
- •Florida has no state income tax and no estate tax
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