The 9 States with No Personal Income Tax: How It Impacts Your Paycheck

Nine states across the United States do not levy a personal state income tax on earned wages. For relocators, remote workers, and hourly employees, understanding what actually gets withheld from your paycheck in these jurisdictions is essential for financial planning.

Which States Have Zero State Income Tax?

• Alaska: No state income tax and no statewide sales tax.
• Florida: Funded primarily through sales tax and tourism revenues.
• Nevada: Sustained by gaming and lodging taxes; zero wage tax.
• New Hampshire: Taxes dividend and interest income only; no tax on wage earnings.
• South Dakota: No individual or corporate income tax.
• Tennessee: Fully eliminated broad-based income taxes.
• Texas: Protected by a constitutional ban on personal income tax.
• Washington: No tax on wages or salaries (capital gains tax applies only to high-net-worth assets).
• Wyoming: No individual state income tax.

What Still Gets Deducted?

Even in a zero-tax state, your paycheck is not 100% net pay. Employers are mandated by federal law to withhold:

• Federal Income Tax: Based on IRS tax brackets and your Form W-4.
• Social Security: 6.20% of your gross earnings up to the annual limit.
• Medicare: 1.45% of all gross wages (plus an additional 0.9% for high earners).

Calculate Take-Home Pay in Zero-Tax States