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HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A Massachusetts VS COUNTRY B Tennessee

Side-by-side analysis of income tax, effective rates, and take-home pay for Massachusetts and Tennessee in 2026.

Daniel · CountryTaxCalc Updated August 2026 Tax Comparison 2026
Calculate your take-home → See all comparisons →
OVERVIEW
Massachusetts charges a flat 5% state income tax on wages, with an additional 4% 'millionaire's tax' surtax on taxable income above $1,107,750 (the 2026 inflation-adjusted threshold, up from $1,053,750 in 2024), bringing the effective top rate to 9% for income above that line. Tennessee charges 0% state income tax on wages and salaries — the Hall Income Tax on interest and dividends was fully repealed as of January 1, 2021, so Tennessee now has no personal income tax of any kind. At $100,000 in taxable income, Massachusetts' flat 5% rate produces $5,000 in state income tax; Tennessee charges $0 — a savings of $5,000/year, or $50,000 across a decade. Because the millionaire's surtax only applies above $1,107,750, it does not affect any of the income levels compared here (including $500,000) — Massachusetts residents earning up to just over $1.1 million pay a straightforward 5% flat rate with no bracket complexity. The tradeoff runs the other way on consumption taxes: Massachusetts charges a modest 6.25% state sales tax with no local add-on, while Tennessee's combined state-and-local sales tax averages 9.61% — the highest in the nation — and, unlike most no-income-tax states, Tennessee also taxes groceries (at a reduced 4% state rate plus local tax). High earners and salaried professionals in Massachusetts still come out well ahead on the income tax side, but Tennessee's heavier reliance on sales tax means the savings gap narrows somewhat for lower earners who spend a larger share of income on taxable purchases.
Section 01

The Big Picture

Top-line rates and effective take-home for a typical earner — including income tax, social contributions, and applicable surcharges.

🦞
COUNTRY A
Massachusetts
TAX RATE
5%
Flat + 4% Surtax ($1.1M+)

Flat 5% income tax, plus a 4% 'millionaire's tax' surtax above $1,107,750

🎸
COUNTRY B
Tennessee
TAX RATE
0%
No Income Tax

0% income tax, funded by the nation's highest average combined sales tax

TYPICAL ANNUAL DIFFERENCE
Moving from Tennessee → Massachusetts at $100,000
$5,000

That's $417/month back in your pocket

Section 02

Tax Savings by Income Level

Net take-home after all income tax, social contributions, and surcharges — for a single employee with no dependents.

GROSS INCOME
🦞 MA TAX
🎸 TN TAX
SAVINGS
10-YEAR
$50,000
$2,500 (5.0% eff.)
$0 (0%)
Tennessee saves $2,500
$25,000
$100,000
$5,000 (5.0% eff.)
$0 (0%)
Tennessee saves $5,000
$50,000
$200,000
$10,000 (5.0% eff.)
$0 (0%)
Tennessee saves $10,000
$100,000
$500,000
$25,000 (5.0% eff.)
$0 (0%)
Tennessee saves $25,000
$250,000
💡

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🦞

Massachusetts Pros & Cons

+ PROS
  • World-class education corridor: Harvard, MIT, and dozens of other top universities drive a dense, high-paying research and biotech job market
  • Simple flat tax: One 5% rate applies to almost all income (wages, interest, most capital gains) with no complex bracket math below $1.1M
  • No sales tax on groceries or clothing (up to $175/item): Everyday essentials are exempt from the 6.25% sales tax
  • Strong healthcare system: Home to some of the top-ranked hospitals and specialist networks in the country
  • Historic, walkable communities: Boston, Cambridge, and coastal New England towns offer dense infrastructure and culture
− CONS
  • 5% flat income tax plus a 4% surtax above $1,107,750: High earners near or above the surtax threshold face a 9% marginal rate
  • High cost of living: Housing in Greater Boston runs well above the national average
  • Winters: Cold, snowy winters and higher heating costs compared to the Southeast
  • Short-term capital gains taxed at 8.5%: Significantly higher than the 5% flat rate on wages and long-term gains
  • Property taxes above the national average: ~1.00% average effective rate, higher still in and around Boston
🎸

Tennessee Pros & Cons

+ PROS
  • Zero state income tax: No tax on wages, salaries, retirement income, or investment gains since the Hall Tax's full repeal in 2021
  • Low property taxes: ~0.52% average effective rate, among the lowest in the country
  • Nashville's booming economy: Healthcare, music/entertainment, and a fast-growing tech and logistics sector
  • No corporate income tax on most businesses (excise/franchise tax applies instead), attractive for entrepreneurs
  • Lower overall cost of living than Massachusetts, especially housing
− CONS
  • Highest combined sales tax in the US: ~9.61% average combined state and local rate
  • Groceries are taxed: A reduced 4% state rate applies to food, plus local sales tax, unlike most other no-income-tax states
  • Fewer nationally-ranked colleges and hospital systems concentrated in one metro area compared to Boston's density
  • Hot, humid summers: A significant adjustment for those used to New England's climate
  • Distance from Northeast family and professional networks: A long move for most Massachusetts residents
FAQ

Frequently Asked Questions

How much will I save moving from Massachusetts to Tennessee?

At $100,000 in taxable income, Massachusetts' flat 5% rate produces $5,000 in state income tax versus $0 in Tennessee — a savings of $5,000/year, or about $417/month. At $500,000, the gap widens to $25,000/year since the 4% Massachusetts surtax doesn't kick in until $1,107,750. Keep in mind Tennessee's average combined sales tax (9.61%) is notably higher than Massachusetts' 6.25%, which offsets some of the savings for big spenders.

What are Massachusetts' income tax brackets for 2026, and how does the millionaire's surtax work?

Massachusetts uses a flat 5% rate on most income — wages, interest, dividends, and long-term capital gains. On top of that, the 'Fair Share Amendment' (approved by voters in 2022, effective 2023) adds a 4% surtax on taxable income above a threshold that adjusts annually for inflation: $1,053,750 in 2024, $1,083,150 in 2025, and $1,107,750 in 2026. Income above that threshold is effectively taxed at 9% (5% + 4%); income below it stays at the flat 5% rate. Short-term capital gains are taxed separately at 8.5%, per the Massachusetts Department of Revenue.

How do property taxes compare between Massachusetts and Tennessee?

Massachusetts' average effective property tax rate is about 1.00% of home value — on a $500,000 home, roughly $5,000/year, with rates running higher in and around Boston. Tennessee's average effective rate is about 0.52%, or roughly $2,600/year on the same home — among the lowest in the country, per Tax Foundation data.

Does Tennessee really have no income tax at all?

Yes. Tennessee's only historical income tax — the Hall Income Tax, which applied to interest and dividend income — was phased out one percentage point per year starting in 2016 and fully repealed effective January 1, 2021. Since then, Tennessee has levied no personal income tax on wages, salaries, retirement income, or investment income of any kind, per the Tennessee Department of Revenue. Tennessee funds government primarily through its 7% state sales tax plus local additions, which combine for the highest average sales tax rate in the nation.

Is the Massachusetts millionaire's surtax something most movers to Tennessee need to worry about?

No — the 4% surtax only applies to taxable income above $1,107,750 in 2026. All four income levels in this comparison ($50,000 to $500,000) fall entirely under the flat 5% rate. It only becomes relevant for very high earners, business owners with a large liquidity event, or those selling significant investment or real estate gains in a single tax year.

Should I move from Massachusetts to Tennessee to save on taxes?

It depends on income level and lifestyle spending. At $100,000, the $5,000/year income tax savings is meaningful but not dramatic once you account for Tennessee's much higher sales tax on everyday purchases. High earners approaching or above $1.1M see the biggest relative benefit, since they'd otherwise face the 9% surtaxed rate in Massachusetts. Retirees and remote workers with lower day-to-day spending tend to benefit most, since they avoid Massachusetts' income tax while limiting exposure to Tennessee's sales tax.
From the brief
NL27%new 2027 rate, down from 30%
DK65.4kkr/mo threshold, cut from 78k
MT1940snon-dom regime unchanged since
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