Finance Maxxing
State & Local Taxes
No Income Tax States
States with no personal income tax on wages.
Nine states impose no personal income tax on wages and salary:
The Nine No-Tax States
| State | Notes |
|---|---|
| Alaska | No income or sales tax; pays residents via Permanent Fund |
| Florida | No income tax; high property insurance costs |
| Nevada | No income tax; funded by gaming/tourism |
| New Hampshire | Repealed dividends/interest tax in 2025 |
| South Dakota | No income tax; low cost of living |
| Tennessee | Repealed investment income tax in 2021 |
| Texas | No income tax; high property taxes (~1.7%) |
| Washington | No wage tax; 7% capital gains tax on gains > $250K |
| Wyoming | No income tax; low population |
The Trade-Offs
No-tax states typically compensate with:
- Higher property taxes (Texas: ~1.7% vs. CA: ~0.7%)
- Higher sales taxes (Tennessee: 9.55% combined avg.)
- Fewer public services in some cases
- Higher insurance costs (Florida: hurricane insurance)
Tax Migration
Moving to a no-tax state can save significantly. For a $500K income in CA (13.3% top rate), moving to FL saves approximately $45,000–$55,000/year in state income tax.
Caution: States like CA and NY aggressively audit departing residents. Maintain clear evidence of your new domicile (driver's license, voter registration, time spent in new state).