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Lowest State income Tax
seven states don't tax your income

Lowest state income tax? My personal favorites are Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming. These fine states have the lowest state income tax...zero.

Probably had nothing to do with Rush Limbaugh, moving permanently to Florida, saying adios to New York state and New York City, both of which tax income.

Of the 41 states that do tax income, 35 base it on your federal return. Tennessee and New Hampshire only tax interest and dividends.

Some states exclude Social Security, state pensions, and military pensions from state taxation

Twenty seven states do not tax Social Security income, actually 34 when you add the seven that do not tax income at all.-- Alabama, Arizona(thanks), Arkansas, California, Delaware, Georgia, Hawaii, Idaho, Illinois, Indiana, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Virginia and Wisconsin.

Twenty six states do not tax military retirement pay. This doesn't apply to me, but men and women that have served their country, keeping us safe deserve a break IMHO.

Here they are, in alphabetical order:Alabama, Alaska, Florida, Hawaii, Illinois, Kansas, Kentucky, Louisiana, Massachusetts, Michigan, Mississippi, Missouri, Nevada, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oregon*, Pennsylvania, South Dakota, Tennessee, Texas, Washington, Wisconsin and Wyoming.

Good for these states.

Ten states exclude all federal, state and local pension income from taxation. These include Alabama, Hawaii, Illinois, Kansas, Louisiana, Massachusetts, Michigan, Mississippi, New York and Pennsylvania.

The state income tax rate may or may not sway you to relocate. But the seven states with zero state income tax are attractive for many.

Hope this helps.

Return from lowest state income tax to frugal retirement living






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