States With No Income Tax in 2026

Nine states collect zero state income tax in 2026. That sounds like a simple win, but several of them make up the revenue elsewhere, through property taxes, sales taxes, or both.

The Nine States With No Income Tax

The full list for 2026: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.

New Hampshire and Tennessee deserve an asterisk. New Hampshire taxes interest and dividend income at 3% in 2026, phasing that out completely by 2027. Tennessee eliminated its Hall Tax on investment income back in 2021, so it now qualifies as fully income-tax-free. For wage earners in either state, the practical effect is already zero state income tax on your paycheck.

No Income Tax Does Not Mean Low Tax

Texas has no income tax, but its effective property tax rate sits around 1.60%, one of the highest in the country. A homeowner with a $350,000 house pays roughly $5,600 per year in property taxes before any exemptions. That offsets a significant chunk of income tax savings for middle-class earners.

Washington state has no income tax but carries a 6.5% base sales tax, and most counties stack local taxes on top of that, pushing the combined rate to 8.5% to 10.4% depending on where you live. Washington also enacted a 7% capital gains tax in 2022 on gains above $250,000, which is currently being challenged in courts but remains in effect.

Nevada runs a 6.85% base sales tax with local additions reaching 8.375% in Clark County, where Las Vegas sits. Florida's combined sales tax averages around 7.02% statewide.

Alaska is the outlier. No state income tax, no state sales tax, and the state actually pays residents through the Permanent Fund Dividend. The 2024 dividend was $1,702 per eligible resident. Local municipalities in Alaska do levy sales taxes, but there is no statewide rate.

What States Are Cutting Income Tax in 2026

Several states are moving toward the no-income-tax club, even if they haven't arrived yet.

Georgia dropped its flat income tax rate to 5.39% in 2024 and is on a legislated glide path to 4.99% by 2029, with the possibility of further cuts tied to revenue triggers. Iowa cut its rate to a flat 3.8% in 2026, down from a top rate of 8.98% just a few years ago. Louisiana dropped to a flat 3% individual income tax rate starting in 2026 after voters approved the change in November 2024. Indiana is scheduled to cut from 3.05% to 2.9% by 2027.

None of these states are income-tax-free yet, but the direction is clear. At least a dozen states have cut income tax rates since 2021.

The Best No-Income-Tax States for Retirees

For retirees, the income tax question goes beyond wages. Social Security benefits, pension income, and 401(k) withdrawals all matter.

All nine no-income-tax states exempt Social Security income by default because they don't tax income at all. That alone puts them ahead of states like Minnesota, which taxes Social Security benefits for higher earners, or Connecticut, which taxes up to 25% of benefits above certain income thresholds.

Florida remains the most popular retirement destination for tax purposes. No income tax, no estate tax, and the homestead exemption reduces assessed property value by $50,000 for primary residents. The tradeoff is homeowners insurance, which has surged in coastal counties after repeated hurricane seasons. Average annual premiums in Florida now exceed $2,400 statewide, roughly double the national average.

South Dakota and Wyoming offer low property taxes alongside zero income tax. Wyoming's effective property tax rate is approximately 0.57%, the second lowest in the country. South Dakota sits around 1.08%. Both states have small populations and limited state services, which is part of how they keep taxes low.

Wyoming also has no estate or inheritance tax, making it a common destination for estate planning. Use our state tax calculator at liveordiehere.com/calculator to model your specific income, property value, and spending against each state's full tax picture.

Key Takeaways

• Nine states have no income tax in 2026: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
• Texas and Washington offset the savings with property and sales taxes that rank among the highest in their respective categories. Alaska is the only state with neither a state income tax nor a state sales tax.
• Wyoming has an effective property tax rate of approximately 0.57% and no estate tax, making it one of the lowest overall tax burdens in the country when combined with zero income tax.

Run your own numbers by state at liveordiehere.com to see which no-income-tax state actually puts the most money in your pocket.