Nine US states impose no personal income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. New Hampshire only taxes interest and dividends, with that tax phasing out completely after 2024.
Let's compare a $75,000 annual salary across different states to show the actual take-home difference:
| State | State Tax Rate (approx.) | Annual State Tax | Monthly Take-Home Gain vs CA |
|---|---|---|---|
| California | ~6.9% effective | ~$5,175 | Baseline |
| New York | ~5.8% effective | ~$4,350 | +$69/mo |
| Texas (no tax) | 0% | $0 | +$431/mo |
| Florida (no tax) | 0% | $0 | +$431/mo |
| Nevada (no tax) | 0% | $0 | +$431/mo |
States without income tax often make up the revenue elsewhere. Texas and Nevada have higher-than-average property taxes. Washington has a higher sales tax. Alaska has no income or sales tax but has oil revenues. When evaluating a move, consider the full tax picture, not just income tax.
At $200,000 salary, moving from California to Texas saves approximately $17,000–$20,000 per year in state income tax alone. At $500,000, the savings can exceed $40,000 annually. This is why many high-earners in tech and finance have relocated from California to Texas or Florida.
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