9 States That Don’t Have State Income Tax

If you read this title and were surprised to learn how many states have no state income tax, we'll assume that means you're not living in one of them.

But before you start browsing homes on Zillow in one of the nine no-income-tax states, know that tax savings are only part of the story. Housing costs, sales taxes, job markets, and overall quality of life can make a big difference in how far that extra money actually goes.

Here's a detailed look at the nine states with no state income tax, with data about affordability, economic opportunity, and day-to-day livability for each.

• Total tax burden: 4.6%
• Combined state and local sales tax rate: 1.82%
• Cost of living index (U.S. avg. = 100): 126.7
• Median home price: $383,000
• Average regular gas price: $4.59 per gallon

Alaska has no state income tax or statewide sales tax and has among the lowest sales tax rates. Overall, it has a 4.6% total tax burden, the lowest of any state and well below the average of 10.58% across all states (including those with and without income taxes). Alaska's sales tax is also uncommonly low. While a few states have no sales tax, including Delaware and Montana, Alaska's combined rate of 1.82% for state and average local sales tax falls well below the 7.53% national average.

But don't get the idea that Alaska is a cheap place to live. Beyond taxes, affordability is a major challenge for residents. Alaska ranks 48th in cost of living across states, driven by higher prices for groceries, utilities, fuel, and transportation.

• Total tax burden: 9.6%
• Combined state and local sales tax rate: 8.24%
• Cost of living index (U.S. avg. = 100): 99.7
• Median home price: $455,000
• Average regular gas price: $4.94 per gallon

Nevada may be best known for Las Vegas, but it's also one of the few no-income-tax states. The state's total tax burden is slightly below average at 9.6%, and its sales tax rates on gas and cigarettes are surprisingly low, but it offsets these savings in other ways. For example, its average sales tax rate is 8.24%, the 13th-highest among states.

Nevada is also home to very high property taxes. The cost of goods and services, such as clothing, alcohol, gambling, and hotel stays, tends to be higher in the state as well. It should come as no surprise, then, that the state has above-average living costs, especially for housing and groceries, and some of the highest gas prices in the country.

• Total tax burden: 8.4%
• Combined state and local sales tax rate: 6.11%
• Cost of living index (U.S. avg. = 100): 91.8
• Median home price: $320,000
• Average regular gas price: $3.50 per gallon

South Dakota has no income tax, but it raises most of its revenue through sales and excise taxes, which account for 3.86% of its 8.4% total tax burden. The remainder comes largely from property taxes, which average 1.00%, the 18th-highest of any state. But on the flip side, property prices are relatively low.

Overall, affordability for South Dakota is mixed. Housing, transportation, and utility costs run slightly above average, and the state's relatively low quality-of-life ranking weighs on its overall appeal. According to the World Population Review's Quality of Life by State 2026 study, South Dakota is 41st for quality of life based on affordability, economy, education and health, quality of life, and safety.

• Total tax burden: 7.5%
• Combined state and local sales tax rate: 5.56%
• Cost of living index (U.S. avg. = 100): 94.6
• Median home price: $484,000
• Average regular gas price: $3.84 per gallon

Wyoming enjoys lower-than-average sales and property tax rates, which help offset the lack of a state income tax, though the state relies on these taxes for much of its revenue. Its total tax burden is just 7.5%, putting it behind only Alaska for the lowest. Overall, the cost of living is near the national average, but housing has grown significantly less affordable in recent years.

Like South Dakota, Wyoming relies more heavily on special taxes, and its quality-of-life ranking remains relatively low compared to other states without income tax, ranking 38th overall (but, notably, second-best for safety).

• Total tax burden: 9.6%
• Combined state and local sales tax rate: 0.00%
• Cost of living index (U.S. avg. = 100): 110.5
• Median home price: $483,000
• Average regular gas price: $3.85 per gallon

This state fully phased out its individual state income tax on January 1, 2025, and is unique in not charging state sales tax at all. New Hampshire makes up for its lack of a broad-based income tax by leaning heavily on property taxes, which average 1.41% and account for 4.51% of its 9.6% total tax burden. This is the sixth-highest property tax rate in the country, and home prices in the state are already somewhat high.

Affordability is further strained by a high cost-of-living index, driven largely by expensive housing, utilities, and healthcare. While the state offers some tax advantages, it isn't an inexpensive place to live.

• Total tax burden: 7.6%
• Combined state and local sales tax rate: 9.61%
• Cost of living index (U.S. avg. = 100): 90.1
• Median home price: $380,000
• Average regular gas price: $3.82 per gallon

Third behind Alaska and Wyoming for low overall tax burdens, you might be surprised to learn that Tennessee's overall cost of living is on the low side. Home prices have increased but remain lower, on average, than those in many states, and the state has the 10th-lowest property tax rate at 0.52%.

Tennessee previously taxed investment income, but that tax was fully repealed in 2021, leaving the state with no income tax on wages or investments.

To offset these losses, Tennessee relies heavily on sales taxes. It has the second-highest combined state and average local sales tax rate, behind Louisiana.

• Total tax burden: 10.7%
• Combined state and local sales tax rate: 9.51%
• Cost of living index (U.S. avg. = 100): 112.9
• Median home price: $630,000
• Average regular gas price: $5.36 per gallon

Washington is home to major employers such as Amazon, Microsoft, and Starbucks, in part due to the absence of a traditional corporate income tax. It also ranks very high, eight, for quality of life. But make no mistake: It's a pricey place to live. While Washington does not levy a personal income tax on wages, it does impose taxes on investment income and capital gains for higher earners.

Washington has the highest overall tax burden among states without a broad-based income tax, driven by high sales and excise taxes, steep gas and housing costs, and a 7% capital gains tax.

• Total tax burden: 8.6%
• Combined state and local sales tax rate: 8.20%
• Cost of living index (U.S. avg. = 100): 91.1
• Median home price: $340,000
• Average regular gas price: $3.78 per gallon

Texas, like New Hampshire, charges high property taxes. In fact, it ranks seventh-highest in property taxes overall and second-highest among states without an income tax, behind Washington. Its sales tax rate is also above average, with a state sales tax rate of 6.25%.

Even so, Texas is still relatively affordable on the whole. Lower housing and grocery costs help offset the tax burden for the average resident, and gas prices tend to be on the lower side. This helps to keep transportation costs manageable.

• Total tax burden: 9.1%
• Combined state and local sales tax rate: 6.98%
• Cost of living index (U.S. avg. = 100): 101.4
• Median home price: $412,000
• Average regular gas price: $4.22 per gallon

Sunny skies and short drives to the beach aside, Florida consistently ranks as a top destination for retirees and vacationers. And its tax structure plays a major role. While the state relies on property and sales taxes for revenue, those rates are generally close to national averages, keeping the overall tax burden relatively low.

Although Florida offers major tax advantages, its cost of living is slightly above average, driven largely by higher grocery, housing, and utility costs. In terms of quality of life, Florida ranks fourth.

Nonprofit organization Tax Foundation provides detailed overviews of tax codes and costs for each U.S. state, and we used the state and local tax burden data from these studies for the tax burden information on this page.

The cost of living index for each state comes from the Missouri Economic Research and Information Center's Cost of Living Data Series. The national average cost of living index for 2025 was 100. U.S. Cities volunteer information to the Council for Community & Economic Research (C2ER), which collects and averages the indices of participating cities and metropolitan areas in that state. The list includes the District of Columbia and Puerto Rico for a total of 52 states.

The median home price by state comes from the Median Home Price by State 2026 study published by World Population Review.

Average gas prices come from AAA Fuel Prices, a site that publishes state gas price averages and tracks news related to fuel costs.

Living in a state with no state income tax may mean lower tax bills at tax time, but it doesn't necessarily mean you'll pay less in taxes overall. Many of these states make up for lost income tax revenue through higher sales, property, or excise taxes, and differences in housing costs, gas prices, and everyday expenses can significantly affect affordability.

One additional factor to keep in mind is local variation. Cities and counties often add their own sales and property taxes, meaning your actual tax burden can vary widely depending on where you live within the same state.