Best States for Take-Home Pay in 2026: No Income Tax States Ranked

Nine US states have no state income tax in 2026. For a worker earning $75,000/year, choosing to live in one of these states over California means keeping an extra $4,000–$7,000 per year in after-tax income. Over a 20-year career, that gap compounds to $80,000–$140,000 — before accounting for investment returns. This guide ranks all nine states, explains the real financial tradeoffs, and helps you decide whether relocating for tax reasons actually makes sense for your situation.

The 9 States with No Income Tax (2026)

As of January 2026, the following states impose no tax on wages and salaries:

1. Alaska
2. Florida
3. Nevada
4. New Hampshire (eliminated tax on interest/dividends in 2025)
5. South Dakota
6. Tennessee (eliminated Hall Tax on investment income in 2021)
7. Texas
8. Washington
9. Wyoming

How Much More Do You Keep? Real Dollar Comparisons

Here's the annual after-tax difference between a zero-tax state (using Texas as reference) and key comparison states at three income levels. All figures use 2026 tax rates for a single filer with no dependents:

Ranking the No-Tax States: Which Is Actually Best?

A zero income tax rate doesn't automatically make a state financially favorable. Cost of living, property taxes, sales taxes, and job market quality all affect your total financial picture.

1. Texas — Best Overall for Mid-to-High Earners

Texas offers the best combination of job market depth, economic growth, and zero income tax. Houston, Dallas, Austin, and San Antonio all have robust economies spanning energy, technology, healthcare, finance, and logistics. The downsides: property taxes are among the highest in the US (1.5%–2.5% of home value annually), and homeowner's insurance is elevated due to severe weather risk. Sales tax reaches 8.25% with local additions.

Best for: Tech workers, energy sector employees, healthcare professionals, logistics and distribution workers.

2. Washington — Best for High Earners, Especially Tech

Washington's minimum wage ($16.28/hour) and median salary ($82,000+) are among the highest in the US, driven by Amazon, Microsoft, Boeing, and a thriving tech ecosystem. Seattle's housing costs are very high ($800,000+ median home price), but the combination of high wages and no income tax is unmatched for high-income tech workers. Spokane and Yakima are far more affordable within the state.

Best for: Software engineers, data scientists, aerospace engineers, remote workers from high-paying employers.

3. Florida — Best for Retirees and Remote Workers

Florida's zero income tax, warm climate, and absence of an estate tax make it enormously popular with retirees and high-net-worth individuals. Miami, Tampa, and Orlando have growing tech and finance sectors. The downsides include rapidly rising home prices, very high property insurance costs (due to hurricane risk), and a 6% base sales tax. Florida's minimum wage is $14/hour (2025) on track to $15 in late 2026.

Best for: Retirees, remote workers, real estate investors, hospitality and tourism sector workers.

4. Nevada — Best for Las Vegas/Reno Workers

Nevada combines zero income tax with no corporate income tax and a 6.85% base sales tax. Las Vegas has diversified beyond gaming into healthcare, logistics, and renewable energy. Reno is growing rapidly as a tech hub. Housing prices have risen sharply. Nevada's minimum wage is $12/hour.

Best for: Hospitality workers, logistics employees, renewable energy sector, remote workers seeking urban amenities with Western lifestyle.

5. New Hampshire — Best in the Northeast

As of 2025, New Hampshire has no income tax on wages or investment income — the only Northeastern state with this distinction. It also has no sales tax. Housing costs are high (proximity to Boston drives demand), but NH residents can commute to Massachusetts for work while living in a tax-free state. The median home price is around $490,000.

Best for: Boston-area commuters, remote workers who want Northeast living without Northeast taxes.

6. Wyoming — Best for Low Cost of Living

Wyoming has zero income tax, no corporate tax, and a low cost of living (except Jackson Hole, which is a luxury enclave). The downside is limited job market depth — Wyoming's economy relies heavily on energy, agriculture, and tourism. Remote workers with location-flexible jobs from high-paying employers are its primary financial beneficiaries.

Best for: Remote workers, energy sector professionals, retirees seeking outdoor lifestyle at low cost.

7–9. Alaska, South Dakota, Tennessee

Alaska has zero income tax and even pays residents an annual Permanent Fund Dividend ($1,000–$2,000 typically). But remoteness, high grocery costs, and limited job markets are significant practical barriers. South Dakota has low living costs and is popular as a trust and business domicile state. Tennessee has zero wage income tax and a growing economy centered on Nashville, but property prices in Nashville have surged dramatically.

The Hidden Costs: What Zero Income Tax States Often Have

States without income tax must fund services somehow. Common mechanisms:

• Higher property taxes: Texas property tax rates (1.5%–2.5%) are among the highest in the US. A $350,000 home costs $5,250–$8,750/year in property taxes — roughly equivalent to 7–12% effective state income tax on a $70,000 salary.
• Higher sales taxes: Tennessee has the highest combined average sales tax rate in the US at 9.55%. Nevada is 8.2% average; Washington is 9.4% average. These fall harder on lower-income households who spend a higher proportion of income on taxable goods.
• Fewer public services: States without income tax sometimes have lower-quality public schools, infrastructure, and social services. This matters if you have school-age children or rely on public transit.

Is Relocating to a No-Tax State Worth It?

For high earners ($100,000+), the answer is often yes — especially when combining tax savings with a lower cost of living. For lower earners, the higher sales and property taxes in many no-income-tax states can actually make their overall tax burden higher than moderate-income-tax states with better services.

Before deciding, calculate your total tax burden in each state — not just income tax, but property tax, sales tax, and the cost of services you'd lose. Our Salary Calculator compares after-income-tax take-home for all 50 states, and is a good starting point for the income tax component of the comparison.