What States Don't Have Income Tax

No one likes paying their income taxes. And, unfortunately, these taxes can feel like something that is impossible to escape. What you might not realize, however, is that you sometimes can escape this taxation…depending on where you live. Believe it or not, some states actually do not have an income tax. So, if you’re lucky enough to live in or move to one of them, you actually can get out of at least this type of taxation.  

Income Tax Free States

So, you’re probably wondering, what states allow you to freely get away without paying income tax?

The answer is:

l  Alaska

l  Wyoming

l  Florida

l  Washington

l  Nevada

l  Texas

l  South Dakota

Murky States

If you aren’t lucky enough to live in one of the states listed above, you might fall into one of the “murky area” states, which include both New Hampshire and Tennessee.

Both of these states do not require an income tax to be paid, but they do tax any interest or dividends you may receive.

Of course, everything isn’t all rosy. Tennessee does charge state and local sales tax rates that are much higher than average, while New Hampshire has really high property taxes.

Don’t Plan a Move Just Yet

Based on this information, you might be tempted to upend your life and move somewhere new, somewhere where you can escape income taxes.

However, rest assured that most states that don’t charge income taxes make up for it in other ways. Florida, for example, has very high property taxes and sales taxes.

So, if you don’t live in an income tax free state, just work with a financial professional to try and reduce the income taxes you do pay. Chances are, with the right help, you can end up legally paying a lot less than you do now.