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HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A South Carolina VS COUNTRY B Tennessee

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

Daniel · CountryTaxCalc Updated May 2026 Tax Comparison 2026
Calculate your take-home → See all comparisons →
OVERVIEW
Tennessee wins on income tax — its 0% rate saves $3,293/year on $100,000 income compared to South Carolina’s reformed 0-5% two-bracket system. For retirees, both states are competitive: SC offers a $15,000 retirement income deduction for residents 65+ and full Social Security exemption, but Tennesse…
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
South Carolina
TAX RATE
0-5%
Progressive (2 brackets)
Two brackets: 0% on first $18,050 taxable; 5% above; 6% state sales tax; very low property ~0.57%
🎸
COUNTRY B
Tennessee
TAX RATE
0%
No Income Tax
Zero income tax since Hall Tax repeal in 2021; 7% state sales tax with highest combined rate in US ~9.55%
TYPICAL ANNUAL DIFFERENCE
Moving from Tennessee → South Carolina at $100,000
$3,293
That's $274/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
🌴 SC TAX
🎸 TN TAX
SAVINGS
10-YEAR
$50,000
$793
$0
$793
$7,930
$75,000
$2,043
$0
$2,043
$20,430
$100,000
$3,293
$0
$3,293
$32,930
$150,000
$5,793
$0
$5,793
$57,930
$250,000
$10,793
$0
$10,793
$107,930
$500,000
$23,293
$0
$23,293
$232,930
💡

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🌴

South Carolina Pros & Cons

+ PROS
  • Lowest property tax in the Southeast: South Carolina’s effective rate of ~0.57% is among the lowest in the US — on a $350,000 home, approximately $990/year less than Tennessee’s 0.71% rate
  • Lower sales tax than Tennessee: SC charges 6% state + up to 3% local (capped at 9% combined in most counties) vs Tennessee’s average of 9.55% combined — tied for highest in the US; SC saves $275–$550/year on typical spending
  • Retirement income deduction: South Carolina residents 65+ can deduct up to $15,000 of retirement income from state taxable income — reducing the income tax burden significantly for older residents on modest retirement income
  • Coastal lifestyle at lower cost: Myrtle Beach and Hilton Head offer Atlantic coastline living at a fraction of Florida prices; Charleston consistently ranked among best US cities for quality of life
− CONS
  • Income tax vs Tennessee’s zero: South Carolina’s two-bracket system (0% to $18,050 taxable; 5% above) costs $3,293/year on $100,000, $10,793 on $250,000 — compared to $0 in Tennessee; for working-age earners this remains the dominant tax disadvantage despite SC’s rate reform
  • 5% top bracket applies broadly: SC’s 5% rate kicks in at just $18,050 of taxable income (equivalent to roughly $34,150 gross after the federal standard deduction) — meaning most employed adults pay 5% on a large share of their income
  • Hurricane and flood risk: South Carolina’s coastal areas face significant hurricane and flooding risk, driving high homeowner insurance premiums that offset the property tax advantage
  • Smaller job market than Tennessee: Nashville and Memphis combined offer a considerably larger and more diverse employment market than Columbia, Charleston, or Greenville individually
🎸

Tennessee Pros & Cons

+ PROS
  • Zero income tax: Tennessee’s complete absence of income tax saves $3,293/year on $100,000 income, $23,293/year on $500,000 — the dominant financial reason to choose Tennessee over South Carolina
  • All retirement income fully untaxed: Social Security, pensions, 401(k) withdrawals, IRA distributions — all completely exempt in Tennessee; there is no state income tax to apply; stronger than SC’s partial deduction
  • Nashville economic powerhouse: Nashville is one of America’s fastest-growing metros — healthcare (HCA Healthcare, Vanderbilt), tech, music industry, and corporate relocations driving exceptional career growth
  • No estate or inheritance tax: Tennessee has no estate tax and no inheritance tax; South Carolina also has no estate tax; neither state penalises wealth transfer
− CONS
  • Highest combined sales tax in the US: Tennessee averages 9.55% combined sales tax — tied for highest nationally; grocery items are taxed at 4% state (most states exempt food); high-spending households pay significantly more than in SC
  • Higher property tax: Tennessee’s effective rate ~0.71% is above South Carolina’s ~0.57%; on a $350,000 home, approximately $490/year more; modestly offsets the income tax advantage for homeowners
  • Nashville housing costs: Nashville median home price has surged past $450,000 — significantly higher than most South Carolina markets; income tax savings can be eroded by higher mortgage costs
  • Tornado risk: Middle Tennessee sits in a tornado corridor with meaningful severe weather risk; while Carolinas face hurricanes, inland Tennessee tornado exposure is a quality-of-life consideration
FAQ

Frequently Asked Questions

How much does moving from South Carolina to Tennessee save in taxes?

On $100,000 income, moving from South Carolina to Tennessee saves $3,293/year in income tax (SC 0-5% two brackets vs TN 0%). However, Tennessee has slightly higher property tax (0.71% vs SC 0.57%) and higher sales tax (9.55% average vs SC up to 9%). On a $350,000 home, property tax difference is approximately $490/year more in TN. Accounting for higher sales tax on $40,000 annual spending, Tennessee residents pay approximately $220 more per year in sales tax. Net annual savings moving SC to TN at $100,000 income: approximately $2,583/year. Over 10 years: $25,830.

Is South Carolina good for retirement compared to Tennessee?

Both states are excellent for retirement, with different strengths. Tennessee has zero income tax, meaning all retirement income (Social Security, pensions, IRA withdrawals) is completely untaxed regardless of amount. South Carolina offers a $15,000 retirement income deduction for residents 65+ and has lower property taxes (0.57% vs TN 0.71%) and lower sales tax. For retirees with modest retirement income under $50,000: South Carolina’s deduction reduces the income tax disadvantage significantly. For affluent retirees with high retirement income: Tennessee’s zero tax rate is substantially better. Tennessee also has lower property taxes than SC’s already-low rate for retirees in high-value homes.

Why does Tennessee have such high sales tax?

Tennessee relies on sales tax as a primary revenue source precisely because it has no income tax. The state 7% rate plus local county/city taxes averaging 2.55% produce the 9.55% average combined rate — tied for highest in the US. Tennessee taxes groceries at 4% (most states exempt food completely). This means lower and middle-income residents pay a higher share of income in sales tax compared to higher earners. Tennessee’s zero income tax is regressive overall — it benefits high earners disproportionately while the high sales tax burdens lower earners relatively more.

Nashville vs Charleston — which city is better for finances?

Nashville wins on income tax savings ($3,293/year at $100K with SC 0-5% vs TN 0%), larger job market, and higher average salaries. Charleston wins on property tax (SC 0.57% vs TN 0.71%), lower sales tax, coastal lifestyle, and significantly lower housing costs (Charleston median ~$400K vs Nashville ~$450K+). For career-focused workers in healthcare, tech, or finance: Nashville’s larger economy and zero income tax create compelling long-term wealth-building advantages. For those prioritising lifestyle, coastal access, or retirement: Charleston’s lower total cost of living and South Carolina’s retirement deduction make it the more nuanced choice.
From the brief
PT38.4%−9.6 vs. headline
CY17.8%incl. 60-day rule
AE 0.0%substance required
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