Alaska is the #1 most tax-friendly state in 2026, with a total tax burden of just 4.92% of personal income. This includes 0% income tax, 0.94% property tax, and just 1.76% state sales tax. The top 10 lowest-tax states are:
Key pattern: 7 of the 9 states with no income tax (Alaska, New Hampshire, Tennessee, Florida, South Dakota, Wyoming, and Texas) rank in the top 15 lowest-burden states. Income tax is the largest component of tax burden for most Americans, but it isn't the whole story -- Nevada and Washington also have no income tax yet rank 27th and 25th respectively, because both carry above-average sales and other taxes that offset the savings.
Methodology: Rankings measure total state and local taxes (income, property, sales, and excise) as a percentage of personal income -- the Tax Foundation's original methodology for this metric. Tax Foundation's own live rankings page is currently serving outdated (2012-era) cached data, so the figures here are sourced from WalletHub's 2026 Tax Burden by State report (published March 2026), which draws on Tax Policy Center data collected March 2026 -- the current, verifiable cross-check for this metric. This is the most comprehensive measure of tax burden because it accounts for all major tax types and adjusts for income levels.
Why this matters: A low-tax state can save you thousands to tens of thousands of dollars annually compared to high-tax states. For example, a $100,000 earner in Wyoming pays $0 state income tax, while the same earner in California pays $4,911 and in New York pays $4,860. Over a career, this compounds to hundreds of thousands in savings.
Source: WalletHub - Tax Burden by State 2026, sourced from Tax Policy Center data
Here's what Best States for Taxes 2026 residents actually pay at different income levels (2026, single filer, standard deduction):
| Annual Income | Federal Tax | State Tax | Total Tax | Take-Home Pay | Effective Rate |
|---|---|---|---|---|---|
| State | Income Tax | Property Tax | Sales Tax | Total Burden | Rank |
| Alaska | 0% | 0.94% | 1.76% | 4.92% | #1 |
| New Hampshire | 0% | 1.50% | 0% | 5.38% | #2 |
| Tennessee | 0% | 0.52% | 9.55% | 6.21% | #3 |
| Florida | 0% | 0.78% | 7.01% | 6.27% | #4 |
| Delaware | 6.60% | 0.54% | 0% | 6.28% | #5 |
| South Dakota | 0% | 1.00% | 6.40% | 6.38% | #6 |
| Wyoming | 0% | 0.53% | 5.36% | 6.70% | #7 |
| North Dakota | 2.50% | 0.92% | 7.09% | 7.02% | #8 |
| Idaho | 5.30% | 0.50% | 6.03% | 7.04% | #9 |
| Oklahoma | 4.50% | 0.79% | 9.06% | 7.05% | #10 |
Note: Includes federal and state income tax only. Does not include FICA (Social Security/Medicare), which adds 7.65% for employees.
Key takeaway: At $100K, Best States for Taxes 2026 takes state tax in state tax alone.
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The "best" state for taxes varies dramatically based on your income, age, and financial situation. Here's how the rankings change based on your profile:
At lower incomes, sales and property taxes matter more than income tax because you're in lower tax brackets (or zero tax after deductions).
Why: Alaska's low sales tax (1.76%) and New Hampshire's zero sales tax save more money when income tax is minimal anyway. Many $50K earners pay little to no income tax after standard deduction ($16,100) and credits.
At this income level, state income tax becomes the dominant factor. You're in the highest state brackets in most states.
Why: At $150K income, California charges $9,561 in state income tax, New York charges $8,291, and New Jersey charges $7,365. Zero-income-tax states save you $7,400-$9,600 annually - far more than differences in property or sales tax.
High earners face the most dramatic tax differences - up to $50,000+ annually between best and worst states.
Avoid for high earners: California (13.3% top rate), Hawaii (11%), New Jersey (10.75%), New York (10.9%), Oregon (9.9%).
Savings example: A $500K earner in California pays about $43,700 in state income tax. The same earner in Florida pays $0. Over 20 years, that's about $874,000 in savings (not adjusted for inflation or investment returns).
Retirees have different tax priorities: Social Security taxation, pension taxation, property tax breaks, and estate/inheritance taxes.
States that tax Social Security at least in part (avoid if retired; thresholds and exemptions vary): Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont. Kansas, Missouri, Nebraska and West Virginia no longer tax it.
Retiree savings example: A couple with $80,000 in retirement income ($40K Social Security + $40K pension) would pay $0 in Florida; in states that tax pension income or part of Social Security, the bill depends on each state's exemptions and income thresholds.
| State | Tax Rate | Tax on $100K Income | Difference from Best States for Taxes 2026 |
|---|---|---|---|
| At $100K Income | Income Tax at $100K | Total Tax at $100K | Difference vs Wyoming |
| Wyoming | $0 | $6,700 | Baseline |
| Alaska | $0 | $4,920 | +$1,780 saved vs WY |
| Florida | $0 | $6,270 | +$430 saved vs WY |
| Texas | $0 | $7,690 | -$990 more tax vs WY |
| California | $4,911 | $14,391 | -$7,691 more tax |
| New York | $4,860 | $13,330 | -$6,630 more tax |
While Alaska ranks #1 overall, individual circumstances may favor other states depending on trade-offs you're willing to make:
Texas has 0% income tax but 1.40% property tax - the 7th highest in the nation. On a $400,000 home, that's $5,600/year in property tax, compared to $2,120 in Wyoming (0.53%).
When Texas wins: High-income renters ($150K+) who don't own property. A $200K earner saves about $14,200/year in income tax vs California, far more than extra property tax costs.
When Texas loses: Homeowners with modest incomes. A $60K earner with a $350K home pays $5,600 in property tax - potentially more than they'd pay in income tax in states like Colorado or Georgia.
New Hampshire has 0% income tax, 0% sales tax, but 1.50% property tax - the 5th highest in America. On a $400K home, that's $6,000/year.
When NH wins: High earners who rent or buy modest homes. No income tax saves $8,000+ annually at $150K income. Zero sales tax saves $1,500-$2,500/year on purchases.
When NH loses: Retirees with paid-off homes and low spending. Property tax becomes your largest expense, whereas Florida offers homestead exemption (up to $50K off assessed value).
Tennessee has 0% income tax but 9.55% sales tax - among the highest in the nation (only Louisiana is higher on average). Combined state + local can hit 9.75% in some cities.
When TN wins: High earners who save/invest heavily. If you earn $150K but only spend $50K (investing the rest), you pay 9.55% on $50K ($4,775) vs paying income tax on full $150K ($8,600+ in many states).
When TN loses: Families with high expenses (kids, medical costs, etc). Spending $80K/year at 9.55% sales tax = $7,640, which could exceed income tax in moderate states.
Alaska ranks #1 with just 4.92% total tax burden - the lowest of any state, ahead of Wyoming's 6.70% (ranked #7). Why doesn't everyone move to Alaska?
The Alaska Permanent Fund Dividend ($1,200 in 2026, varies yearly) offsets some costs, but many find the lifestyle trade-offs significant.
Bottom line: Tax burden is one factor. Consider cost of living, climate, job market, and lifestyle preferences. A $10,000/year tax savings doesn't help if your cost of living increases by $15,000.
Alaska is the best state for taxes in 2026 with a 4.92% total tax burden (income + property + sales) -- the lowest of any state. It has 0% income tax, 0.94% property tax, and just 1.76% state sales tax (localities can add more), plus the Permanent Fund Dividend that offsets costs further. For a $100,000 earner, no-income-tax states like Alaska save $4,911/year vs California and $4,860/year vs New York in income tax alone. Wyoming (6.70% total, ranked #7) is a close alternative many people choose instead for its milder winters and lower cost of living relative to Alaska's remoteness.
Florida, Wyoming, Nevada, Tennessee, and Texas are tied for best states for high earners - all have 0% income tax. At $200K income, you save roughly $10,500-$17,800 annually in state income tax vs high-tax states. Florida edges ahead slightly due to low property tax (0.78%), no estate tax, and warm climate attracting high earners. A $200K earner in California pays about $14,211 state income tax; in Florida, $0.
Florida is the most tax-friendly state for retirees. It has 0% tax on Social Security, pensions, 401(k) withdrawals, and IRA distributions, plus no estate tax or inheritance tax. Homestead exemption reduces property tax by up to $50,000 for primary residences. A retiree with $80K income ($40K Social Security + $40K pension) pays $0 in state tax in Florida vs $4,200+ in states that tax retirement income.
Nine states have no income tax in 2026: Alaska, Florida, Nevada, New Hampshire (only dividends/interest taxed prior to 2025, now fully eliminated), South Dakota, Tennessee, Texas, Washington, and Wyoming. Seven of the nine rank in the top 15 for lowest total tax burden (Nevada and Washington do not). These states fund government through sales tax, property tax, tourism taxes, and business taxes instead of income tax.
Hawaii has the highest tax burden in 2026 at 13.30% of personal income, followed by New York (12.39%) and Vermont (11.10%). New York combines high income tax (3.9-10.9%), high property tax (1.30% average), and moderate sales tax (8.52% average) -- a $100,000 earner in New York pays about $4,861 in state income tax (plus about $3,400 more if living in NYC), plus $5,200 property tax on a $400K home. Connecticut is often assumed to be a top-tier high-tax state, but its actual total burden (9.00%) is closer to the middle of the pack nationally, not near the top.
Not always. States with no income tax often have higher property or sales taxes to compensate. Texas has 1.40% property tax (vs 0.53% in Wyoming), costing an extra $3,480/year on a $400K home. Tennessee has a 9.55% sales tax, among the nation's highest. No-income-tax states are best for high earners, renters, and retirees. Middle-income homeowners may pay more overall due to property taxes.
At $100,000 income, moving from California to Wyoming saves $4,911/year in state income tax alone. At $150,000, you save $9,561/year. At $250,000, you save $18,861/year. Over a 30-year career, a $100K earner saves about $147,300 (not counting investment returns). Factor in property tax differences (California 0.74% vs Texas 1.40% or Florida 0.78%) and sales tax to calculate your total savings.
Wyoming is a strong overall choice for remote workers, offering 0% income tax, low property tax (0.53%), moderate sales tax (5.36%), low cost of living, and no remote work restrictions. Alaska technically has the lowest total tax burden of any state (4.92%, thanks to near-zero sales tax), but its remoteness and cost of living make Wyoming or Florida a more practical pick for most remote workers who can genuinely live anywhere. Florida ranks close behind due to similar tax benefits plus warmer weather and no state estate tax. Avoid states with "convenience of employer" rules (New York, Connecticut) that may tax remote income even if you don't live there.
New Hampshire has neither a state income tax on wages nor a general sales tax, but has above-average property tax (1.50%). Alaska has 0% income tax and very low state sales tax (1.76%, though localities can add more). Oregon, Montana, and Delaware have no sales tax but do have income tax. States must generate revenue somehow.
This ranking measures total state and local taxes (income, property, sales, excise) as a percentage of personal income -- the Tax Foundation's original State-Local Tax Burden Index methodology. It accounts for all major tax types and adjusts for income levels, making it the most comprehensive comparison. Because Tax Foundation's own live rankings page is currently serving outdated (2012-era) cached data, the figures on this page are sourced from WalletHub's 2026 Tax Burden by State report, which draws on Tax Policy Center data collected March 2026 -- the current, verifiable cross-check for this metric.
Often, but not always. Texas (1.40%), New Hampshire (1.50%), and Tennessee (0.52%) have no income tax with varying property taxes. Wyoming has 0% income tax and just 0.53% property tax (11th-lowest nationally). Alaska has 0% income tax and 0.94% property tax. States need revenue, so most offset low income tax with higher property or sales taxes, but the trade-off varies significantly.
Only if the lifestyle fits. Consider: (1) Job market - Can you maintain your income? (2) Cost of living - Texas/Florida have spiking housing costs. (3) Climate - Wyoming winters hit -20°F. (4) Family - Schools, healthcare, culture matter. (5) Long-term - Will you stay 5+ years to recoup moving costs? A $10,000/year tax saving loses value if you hate living there or your salary drops $20,000.
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How we rank states: Our rankings are based on the Tax Foundation's State-Local Tax Burden Index 2026, which measures total state and local taxes as a percentage of personal income. Tax Foundation's own live rankings page is currently serving outdated (2012-era) cached data, so the figures on this page are sourced from WalletHub's 2026 Tax Burden by State report (published March 2026), which draws on Tax Policy Center data collected March 2026 -- the current, verifiable cross-check for this metric. This includes:
Why this methodology: Tax burden as a percentage of income is more accurate than just comparing tax rates because it accounts for how much residents actually pay relative to what they earn. A state with low rates but high incomes may generate more tax revenue than a state with high rates but low incomes.
Data sources:
Income-specific calculations: For income-level comparisons ($50K, $150K, $500K earners), we use actual 2026 state income tax brackets from each state's Department of Revenue, combined with state average property and sales tax rates. Calculations assume single filer, standard deduction, W-2 income only.
Verification: All state income tax rates verified against official state Department of Revenue websites as of March 2026. Property tax averages from U.S. Census Bureau Annual Survey of State and Local Government Finances. Sales tax rates from Tax Foundation State and Local Sales Tax Rates 2026 report.
Limitations: Rankings show averages and may not reflect individual circumstances. Actual tax burden varies based on: filing status (single vs married), number of dependents, deductions (mortgage interest, charitable giving), income types (W-2 vs self-employment vs capital gains), county/city (property and sales tax vary within states), and lifestyle (spending habits affect sales tax). Property tax rates vary significantly by county and city within each state.
For personalized analysis: Consult a licensed tax professional in your target state. Use official state tax calculators for precise estimates. Consider total cost of living, not just taxes - housing, utilities, insurance, and other costs vary more than taxes in some cases.
Last Updated: September 2026
Verified By: Daniel · CountryTaxCalc
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Last Updated: September 2026