9 States With No Income Tax (2026): The Full Picture

Nine states charge zero income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. On a $100,000 salary, that’s $3,000–$8,000 in annual savings compared to high-tax states. Sounds like free money — but it’s more nuanced than that.

States need revenue. When they don’t tax income, they make it up elsewhere. Texas has no income tax but property tax rates of 1.6–2.2% — among the highest nationally. A $350,000 home in Texas costs $5,600–$7,700/year in property taxes vs $2,800 in a state like Colorado with 4.4% income tax.

Washington charges no income tax but has a 6.5% state sales tax (up to 10.5% with local additions). Florida’s sales tax is 6% plus local surcharges. Over a year, a household spending $50,000 on taxable goods pays $3,000–$5,000 in sales tax. That offsets a significant chunk of income tax savings.

Cost of living matters more than tax rates. A $100K salary in Tennessee (no income tax, cost index 90) buys the same lifestyle as roughly $80K in California (13.3% top rate, cost index 142) after adjusting for both taxes AND living costs. The gap shrinks dramatically.

Where no-tax states genuinely win: high earners. At $200K+, the income tax savings in Texas or Florida become substantial ($10K–$20K/year) and are harder to offset with property and sales taxes. This is why so many remote workers and retirees relocate.

The bottom line: for average earners ($50K–$80K), no-tax states save less than you think after adjusting for other taxes and costs. For high earners ($150K+), the savings are real and significant. Use our calculator to run the exact numbers for your salary and compare states side by side.

Run this analysis on your actual salary.