States With No Income Tax (2025)
Quick Answer
Nine states charge no income tax on wages in 2025: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. Living in one of these states means no state income tax is withheld from your paycheck, which can save you thousands per year compared to high-tax states. However, these states often have higher sales taxes, property taxes, or other fees to fund state services.
The Nine No-Income-Tax States
| State | Sales Tax | Property Tax Rate (Avg) | Other Notes |
|---|---|---|---|
| Alaska | 0% (local up to 7.5%) | 1.04% | Oil revenue funds state budget |
| Florida | 6.0% | 0.80% | Large tourism revenue |
| Nevada | 6.85% | 0.53% | Gaming revenue |
| New Hampshire | 0% | 1.57% | No sales tax either, high property tax |
| South Dakota | 4.5% | 1.08% | No corporate income tax |
| Tennessee | 7.0% | 0.56% | Highest combined sales tax rate |
| Texas | 6.25% | 1.60% | High property taxes |
| Washington | 6.5% | 0.87% | Has a capital gains tax on high earners |
| Wyoming | 4.0% | 0.55% | Mineral extraction revenue |
How Much You Save
The savings depend on what your state income tax would have been. Here is the comparison for someone earning $80,000:
| State | State Income Tax on $80K | Annual Savings in No-Tax State |
|---|---|---|
| California | ~$3,500 | $3,500 saved |
| New York | ~$3,900 | $3,900 saved |
| Illinois | ~$3,960 | $3,960 saved |
| Oregon | ~$6,100 | $6,100 saved |
See your exact savings by comparing states with the relocation tool or running your salary through the SalaryHog calculator.
Real Example With Actual Numbers
Elena earns $95,000 and is considering a move from California to Texas.
In California:
- State income tax: ~$4,800/year
- SDI (1.1%): ~$1,045/year
- Total state deductions: ~$5,845/year
In Texas:
- State income tax: $0
- Total state deductions: $0
Annual savings from the move: ~$5,845 — that is an extra $487 per month in take-home pay. Use the relocation tool to factor in cost of living differences.
The Trade-Offs
Living in a no-income-tax state is not always cheaper overall:
Property Taxes
Texas has some of the highest property taxes in the nation, averaging 1.6%. On a $350,000 home, that is $5,600/year — which can offset or exceed income tax savings for homeowners.
Sales Taxes
Tennessee has the highest combined state and local sales tax in the country (about 9.5%). If you spend $40,000/year on taxable goods, that is $3,800 in sales tax.
Cost of Living
Some no-tax states (especially Nevada and Florida cities) have rapidly increasing housing costs. The income tax savings may not compensate for higher rent.
Washington's Capital Gains Tax
Washington charges a 7% tax on capital gains above $270,000, making it not entirely tax-free for high-earning investors.
Best States for Take-Home Pay
The best state for you depends on your income level, whether you rent or own, and your spending habits. Generally:
- High earners who rent: Texas and Florida offer the most savings
- Homeowners: New Hampshire and Wyoming may have better overall tax burdens despite property taxes
- Retirees: Florida is popular because it also has no estate tax and does not tax retirement income
Compare any two states side by side with the relocation tool or check your state-specific breakdown at the SalaryHog calculator.