Is it financially worth moving to a no-income-tax state?

It depends on your income level, current state, and personal circumstances. At $50,000 income, the savings ($1,500-$3,500/year) may not justify relocation costs and disruption. At $150,000+ income, saving $8,000-$15,000+ per year is a compelling financial argument, especially if you can work remotely. Factor in total cost of living, not just state income tax.

If I work remotely, do I pay state income tax where I live or where my company is?

You pay income tax where you legally reside (your domicile), not where your employer is located — with some exceptions (New York’s convenience of employer rule can apply NY state tax to remote workers working 'for the convenience of the employee' rather than required by the employer). For most states, remote workers pay tax to their home state only.

Washington State is no-income-tax — why does it rank lower?

Washington has no wage income tax but has very high sales tax (8.87% average) and a 7% capital gains tax on gains above $250,000. For workers with significant investment income, the capital gains tax significantly reduces the advantage. Washington also has high cost of living in metro areas.

Can I maintain residency in a low-tax state while working in a high-tax state?

Technically residency is determined by domicile and physical presence — you cannot simply claim residency in Nevada while working and living in California. Tax authorities look at days spent in each state, where your home is, where your family and professional ties are, and other factors. Attempting to claim low-tax residency while effectively living in a high-tax state can result in audits and back-taxes with penalties.

Are there any states with no income tax AND relatively low property taxes?

Wyoming and South Dakota stand out as having no income tax AND low property tax rates (approximately 0.57% effective rate). Florida and Nevada also have moderate property taxes relative to their home values. Texas is the notable exception — no income tax but high property taxes (1.6%+ effective rate) that can offset some of the income tax savings for homeowners.

Take-Home Pay in No-Income-Tax States: How Much More Do You Keep?

Nine states have no income tax at all, and a few others exempt all retirement income or have very low rates. For workers and retirees considering relocation, understanding exactly how much more take-home pay a no-tax state provides — at different income levels — is a key data point in any relocation decision.

No-Income-Tax State Take-Home Pay Advantage

Estimated take-home pay: California vs. Texas (single filer, 2025, standard deductions, approximate)

Annual Salary	California Take-Home (est.)	Texas Take-Home (est.)	Annual Advantage (TX over CA)
$50,000	$38,500	$41,900	+$3,400/year
$75,000	$55,500	$61,200	+$5,700/year
$100,000	$71,000	$79,200	+$8,200/year
$150,000	$100,500	$112,500	+$12,000/year
$200,000	$128,000	$144,000	+$16,000/year

📈10-Year Value of No-Income-Tax State at $100,000 Salary

A $100,000 earner in Texas vs. California saves approximately $8,200/year in state income taxes. Over 10 years: $82,000 in cumulative savings (not accounting for salary growth). Invested at 7%: approximately $114,000 in future value. The financial case for moving from a high-tax to no-tax state is compelling at moderate-to-high incomes.

Factors That Offset No-Income-Tax Advantages

Property taxes: Texas has some of the highest property tax rates in the nation (1.6-2.4% effective rate); Florida is moderate (0.8-1.3%)
Sales tax: no-income-tax states often compensate with higher sales taxes (TX: 6.25% state + up to 2% local; FL: 6% state + up to 1.5% local)
Cost of living: housing costs in some no-tax states (FL, TX metros) have risen significantly, potentially offsetting state tax savings
Job market depth: leaving a major metro for a smaller market may reduce earnings growth opportunities
Total tax burden: the Tax Foundation ranks total state and local tax burden — Texas and Nevada often have total burdens comparable to moderate-income-tax states when all taxes are included

Which No-Tax States Have the Best Overall Tax Picture?

No-income-tax states with overall tax climate comparison

State	Income Tax	Property Tax Rate	Sales Tax (avg.)	Overall Tax Climate
Wyoming	None	0.57% (low)	5.34%	Excellent overall — consistently ranked best
South Dakota	None	0.57% (low)	5.5%	Excellent — very low total tax burden
Nevada	None	0.57% (low)	8.23%	Good — low property, higher sales
Florida	None	0.89%	7.01%	Good — popular retirement destination
Texas	None	1.6% (high)	8.19%	Mixed — income savings partially offset by high property
Washington	None on income	0.87%	8.87%	Mixed — highest sales tax in no-income-tax group

Calculate Your Take-Home in Any No-Tax State

Select your target state and salary to see exactly how much more you would keep with no state income tax.

Open Take-Home Pay Calculator →

Frequently Asked Questions

Take-Home Pay in No-Income-Tax States: How Much More Do You Keep?

No-Income-Tax State Take-Home Pay Advantage

Factors That Offset No-Income-Tax Advantages

Which No-Tax States Have the Best Overall Tax Picture?

Frequently Asked Questions

Frequently Asked Questions

More Take-Home Pay Guides

How to Use a Take-Home Pay Calculator: Complete Guide

How Federal Income Tax Withholding Works: A Complete Explanation

How FICA Taxes Work: Social Security and Medicare on Your Paycheck