Nine U.S. states—Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming—do not levy a state personal income tax as of 2025. While they do not tax wages, these states often rely on higher sales or property taxes to fund services. Washington specifically taxes capital gains for high earners, and New Hampshire recently eliminated its tax on interest and dividends.
Five U.S. states have no statewide sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon, often called the "NOMAD" states. However, this doesn't always mean zero tax on purchases, as Alaska allows local jurisdictions to impose their own sales taxes, and New Hampshire taxes prepared food/meals, while Montana has a lodging tax.
Nine U.S. states have no state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming, though Washington does tax long-term capital gains, and New Hampshire is phasing out its interest/dividend tax. However, a lack of income tax doesn't mean lower overall taxes, as these states often rely on higher sales, property, or other specific taxes, like Florida's high homeowners' insurance or Texas's property taxes, to fund services, so consider the total tax burden, not just income tax.
Key Takeaways
Nine U.S. states levy no income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
Living in a state with no income tax can be better, offering more take-home pay and simpler filing, especially for high earners, but it's not universally superior as these states often have higher sales, property, or utility taxes, and potentially less funding for public services like education, so you must weigh the entire tax picture and cost of living (housing, utilities, job market) against your personal priorities.
Nevada, Washington, Texas, Florida, Tennessee, Wyoming, Alaska, South Dakota and New Hampshire.
Portland, Oregon, and Anchorage, Alaska, have no state or local sales taxes. Richmond, Virginia has 5.3 percent state sales tax. Honolulu, Hawaii, has a low sales tax rate of 4.5 percent, but the tax applies broadly to goods and services when compared with sales tax from other locations.
The top 10 low-tax countries in 2025
There's no single "lowest tax" state, as it depends on what you earn and spend, but Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming have no state income tax, while South Dakota, Wyoming, and New Hampshire often rank highest for overall low tax burden due to minimal income/excise taxes, though some states without income tax make up for it with higher sales or property taxes.
You generally don't have to pay taxes if your income is less than the standard deduction or the total of your itemized deductions, if you have a certain number of dependents, if you work abroad and are below the required thresholds, or if you're a qualifying non-profit organization.
How Florida Has No Income Tax. In 1968, the Florida Constitution was ratified to prevent the state from collecting an income tax. And the state constitution protects taxpayers from having the state impose new taxes or raise them.
Many states don't tax basic groceries, with some (Alaska, Delaware, Montana, New Hampshire, Oregon) having no state sales tax at all, while others exempt food from their general sales tax, like Arizona, California, Colorado, Connecticut, Florida, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Texas, Vermont, Washington, West Virginia, Wisconsin, and Wyoming, according to Stripe,, though local taxes or taxes on prepared/soda/candy often apply. The key is the distinction between groceries for home consumption (often exempt) and prepared foods or snacks (usually taxed).
Tax-free shopping is currently available in the following countries: Argentina, Armenia, Australia, Austria, Azerbaijan, Belgium, Bulgaria, China, Colombia, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Guernsey, Greece, Hungary, Iceland, Indonesia, Ireland, Israel, Italy, Japan, Korea, ...
States with No Income Tax in the United States. Last updated: May 2025. As of 2025, nine U.S. states levy no personal income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
States with the lightest tax burden:
Free federal and state filing
For anyone with an AGI under $51,000. If you don't qualify, your federal return is free and state filing is $15.99.
Do States With No Income Tax Save Residents Money? States with no income taxes save residents money — on their income taxes. However, many states without income taxes can be expensive in other ways. They might have a higher sales tax, higher property taxes, and/or a higher cost of living.
There are several ways to reduce tax bills and pay no taxes legally, and one of the easiest ways is to take full advantage of a self-employment tax deduction scheme. In the US, this deduction allows you to deduct a portion of your self-employed income from your taxable profit, provided there are allowable expenses.
To buy a house, you generally need an income that allows for housing costs (mortgage, taxes, insurance) to be around 28-36% of your gross monthly income, but recent studies show buyers often need $100k+ annual income to afford a median-priced home due to rising prices and rates, with specific requirements varying by location and loan type. A common guideline is the 28/36 rule: spend no more than 28% on housing and 36% on total debt, but lenders look at your Debt-to-Income (DTI) ratio, ideally keeping total debt under 43%.