Top 10 Lowest Tax States (2026)
| Rank | State | Total Tax Burden | Income Tax | Sales Tax (avg) | Property Tax |
|---|---|---|---|---|---|
| 1 | Alaska | 4.6% | None | 1.82% | 1.04% |
| 2 | Wyoming | 6.1% | None | 5.44% | 0.56% |
| 3 | Tennessee | 6.3% | None | 9.55% | 0.64% |
| 4 | South Dakota | 6.4% | None | 6.10% | 1.22% |
| 5 | Florida | 6.6% | None | 7.05% | 0.86% |
| 6 | New Hampshire | 6.8% | None | 0% | 1.93% |
| 7 | Nevada | 7.0% | None | 8.24% | 0.53% |
| 8 | Texas | 7.2% | None | 8.20% | 1.60% |
| 9 | North Dakota | 7.3% | 0%-2.50% | 6.96% | 0.98% |
| 10 | Washington | 7.5% | None* | 9.23% | 0.92% |
Tax burden percentages based on Tax Foundation and Census Bureau data. *Washington has a 7% capital gains tax on gains over $262,000.
Top 10 Highest Tax States (2026)
| Rank | State | Total Tax Burden | Income Tax (Top) | Sales Tax (avg) | Property Tax |
|---|---|---|---|---|---|
| 50 | New York | 12.7% | 10.9% | 8.52% | 1.40% |
| 49 | California | 11.5% | 13.3% | 8.68% | 0.71% |
| 48 | Illinois | 11.0% | 4.95% | 8.81% | 2.07% |
| 47 | Connecticut | 10.6% | 6.99% | 6.35% | 1.96% |
| 46 | New Jersey | 10.2% | 10.75% | 6.60% | 2.23% |
| 45 | Vermont | 10.1% | 8.75% | 6.24% | 1.83% |
| 44 | Minnesota | 10.0% | 9.85% | 7.49% | 1.02% |
| 43 | Maryland | 9.9% | 5.75%+local | 6.00% | 1.00% |
| 42 | Iowa | 9.8% | 3.80% | 6.94% | 1.52% |
| 41 | Ohio | 9.6% | 0%-3.50% | 7.24% | 1.53% |
Lowest Tax States for Different Situations
For Retirees
Retirees should look beyond just income tax rates. The best low-tax states for retirees consider Social Security taxation, retirement income exemptions, property tax relief for seniors, and estate taxes:
- Florida — No income tax, no estate tax, homestead exemption
- Wyoming — No income tax, no estate tax, low property tax
- Nevada — No income tax, no estate tax, lowest property tax
- South Dakota — No income tax, no estate tax, favorable trust laws
- Tennessee — No income tax (eliminated Hall Tax 2021), low property tax
See our detailed retirement tax by state guide for more.
For High Earners ($200K+)
High earners benefit most from no-income-tax states because the tax savings scale with income:
- Texas — No income tax, strong job market, growing economy
- Florida — No income tax, no estate tax, favorable homestead laws
- Washington — No income tax on wages (capital gains tax above $262K)
- Nevada — No income tax, no corporate tax
- Wyoming — No income tax, no corporate tax, lowest total burden
For Families
Families need to weigh tax savings against school quality, child care costs, and family-friendly policies:
- New Hampshire — No income/sales tax, excellent schools (though high property tax)
- Florida — No income tax, growing school options, homestead exemption
- Texas — No income tax, $100K homestead exemption for school taxes
- South Dakota — No income tax, low cost of living
- Indiana — Low flat tax (3.05%), reasonable property tax, low cost of living
The Full Tax Picture: Why Just Looking at Income Tax Is Misleading
Many people focus only on income tax when evaluating state tax burden. This can be misleading because:
- Texas has no income tax but property taxes averaging 1.60% — meaning a $400,000 home generates $6,400/year in property tax.
- Tennessee has no income tax but the highest combined sales tax rate in the country at 9.55%.
- New Hampshire has no income or sales tax but the 4th-highest property tax at 1.93%.
- Washington has no income tax but sales taxes averaging 9.23% and a 7% capital gains tax.
Use our state comparison calculator to see the total tax impact based on your specific income, spending, and property value.
Frequently Asked Questions
Alaska at approximately 4.6% of income. It has no income tax and no state sales tax. Wyoming (6.1%) and Tennessee (6.3%) are second and third.
Not necessarily. Low-tax states may have fewer public services, less infrastructure spending, and lower-funded schools. Consider the full picture including services, job opportunities, and quality of life.
New York at approximately 12.7% of income. California (11.5%), Illinois (11.0%), Connecticut (10.6%), and New Jersey (10.2%) are also among the highest.
Total tax burden includes state income tax, local income tax, sales taxes, property taxes, vehicle taxes, and excise taxes, expressed as a percentage of total personal income.