Compare taxes and see how much you save moving from Michigan to Tennessee
Michigan imposes a 4.25% flat income tax plus moderate property taxes averaging 1.44% statewide, creating a dual tax burden on homeowners. Tennessee has zero state income tax (constitutionally protected since 2014) and one of the lowest property tax rates at 0.67% average—less than half Michigan's rate. A $100,000 earner saves $4,250 per year on income tax alone moving to Tennessee. Add property taxes and the savings increase significantly: on a $100K income + $400K home, Michigan charges $10,010 total (income + property) while Tennessee charges just $2,680 (property only), saving $7,330 per year. Over 5,000 people moved from Michigan to Tennessee annually between 2020-2023, driven by tax savings, lower cost of living (Nashville is 28% cheaper than Detroit metro), and job growth in Nashville's booming economy. Tennessee eliminated its estate tax in 2016; Michigan has never had one but offers no income tax relief for workers.
Flat Tax
Plus moderate property tax burden
No Income Tax
Constitutional prohibition on income tax
At $100,000 + $400K home income:
That is $611/month back in your pocket!
| Income | MI Tax | TN Tax | Savings | 10-Year |
|---|---|---|---|---|
| $50,000 | $2,125 | $0 | $2,125 | $21,250 |
| $75,000 | $3,188 | $0 | $3,188 | $31,880 |
| $100,000 | $4,250 | $0 | $4,250 | $42,500 |
| $150,000 | $6,375 | $0 | $6,375 | $63,750 |
| $250,000 | $10,625 | $0 | $10,625 | $106,250 |
| $500,000 | $21,250 | $0 | $21,250 | $212,500 |
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Moving from Michigan to Tennessee? Multi-state returns are tricky—partial-year residency, different deadlines, avoiding double taxation. Get matched with a CPA who specializes in state moves. Virtual meetings, fixed pricing.
Get Matched With a CPA →At $100,000 income with a $400,000 home, you save $7,330 per year moving to Tennessee ($611/month). This includes $4,250 in income tax savings and $3,080 in property tax savings. Over 10 years, that's $73,300 saved. After accounting for Tennessee's higher sales tax (9.55% vs 6%), net savings still exceed $5,000 annually for most households.
Yes. Tennessee's constitution (Article II, Section 28, adopted 2014) prohibits state income tax on wages and earned income. Tennessee previously taxed investment income (Hall Tax at 6%) but repealed this entirely in 2021. Tennessee now has zero income tax on wages, salaries, investment income, capital gains, dividends, interest, and retirement distributions. Constitutional protection makes it highly unlikely to ever change.
Michigan averages 1.44% property tax statewide (higher in Detroit area: Wayne County 2.08%, Oakland County 1.73%). Tennessee averages 0.67%—less than half Michigan's rate. On a $400,000 home: MI = $5,760/year, TN = $2,680/year—savings of $3,080/year. Tennessee home values are comparable to Michigan suburbs, so you get lower taxes without paying more for housing.
Tennessee's 9.55% average sales tax is significantly higher than Michigan's 6%. For a household spending $60,000/year on taxable goods, you pay about $2,000-2,500 more in sales tax in Tennessee. However, income tax savings alone ($4,250 at $100K) exceed this difference. Combined with property tax savings, Tennessee still saves you $5,000-7,000 annually despite higher sales tax.
Approximately 5,000-7,000 people moved from Michigan to Tennessee annually between 2020-2023. Drivers include tax savings ($7,000+/year for homeowners), lower cost of living (Nashville 28% cheaper than Detroit metro), job growth in Nashville's diversified economy, and dramatically better weather (Nashville gets 4 inches snow vs Detroit's 43 inches annually).
For retirees, the comparison is closer. Michigan exempts all retirement income (Social Security, pensions, 401k/IRA, military), so retirees pay $0 income tax in both states. Tennessee wins on property taxes: 0.67% vs 1.44% saves $2,000-4,000/year on a typical retiree home. Tennessee also offers milder winters and lower cost of living. Michigan offers Great Lakes recreation and four seasons. Neither state has estate tax.
If you're a remote worker, yes. Your employer pays you the same gross salary regardless of where you live. Moving to Tennessee eliminates Michigan's 4.25% income tax. On $100,000, you save $4,250/year immediately. On $150,000, you save $6,375/year. Many automotive industry workers, engineers, and tech professionals moved to Nashville during COVID and kept their salaries while eliminating state income tax.
Nashville's cost of living is approximately 28% lower than Detroit metro according to 2025 data. Housing in Nashville suburbs ($425K median) costs 20-30% less than comparable Detroit suburbs. Groceries, dining, and utilities are 15-20% cheaper. Combined with tax savings ($7,000+/year), total household savings often exceed $12,000-18,000 annually moving from Detroit area to Nashville.
Yes. Michigan will tax you as a resident if you maintain domicile there. To establish Tennessee residency: (1) spend 183+ days in Tennessee, (2) get Tennessee driver's license, (3) register to vote in Tennessee, (4) file Declaration of Domicile with county clerk, (5) update financial accounts and estate documents to Tennessee address, (6) sell or rent Michigan home if possible. Keep documentation of days in each state.
Nashville weather is dramatically milder than Detroit. Winter: Nashville avg low 29°F vs Detroit 18°F; Nashville gets 4 inches snow annually vs Detroit's 43 inches (no lake-effect blizzards). Summer: both are warm/humid (Nashville slightly hotter: 90°F+ vs Detroit 85°F+). Nashville has longer growing season and milder fall/spring. Most Michigan transplants cite weather as a major quality-of-life improvement.
High sales tax (9.55% vs MI 6%), hot/humid summers (90°F+ May-September), limited public transit (car-dependent), rising housing costs (Nashville prices up 35% since 2020), traffic congestion worsening, healthcare costs above national average. You'll miss Great Lakes recreation, four seasons climate, and Detroit's automotive heritage. But for most people, $5,000-10,000/year in net savings and better weather outweigh these trade-offs.
Yes. Nashville has advanced manufacturing (Nissan North America HQ in nearby Smyrna with 8,000+ employees, GM Spring Hill plant), plus booming healthcare (HCA Healthcare, Vanderbilt Health), logistics (Amazon, FedEx), tech, and finance sectors. Many Michigan transplants find engineering, manufacturing, or supply chain roles. Remote work also enables keeping Michigan automotive jobs while living in Tennessee and eliminating state income tax.