State Income Tax Guide 2026: Best and Worst States
Published on January 5, 2026
States with No Income Tax
If you want to maximize your take-home pay, consider moving to one of the eight states with no tax on earned income:
New Hampshire also does not tax wages, though it taxes interest and dividends.
High Tax States
On the other end of the spectrum, some states have high progressive income taxes. California leads the pack with a top rate of 13.3% (plus a surcharge for millionaires). Hawaii, New Jersey, New York, and Oregon also have top brackets exceeding 9%.
Total Tax Burden: Income vs. Sales vs. Property
Income tax isn't everything. Texas has no income tax but high property taxes. Washington has no income tax but high sales tax. Oregon has high income tax but no sales tax. When choosing where to live, you must look at the total tax burden relative to your lifestyle.
Case Study: $100,000 Salary
Let's look at how a $100,000 salary performs in three different states:
| State | State Tax | Sales Tax (Avg) | Property Tax (Avg) |
|---|---|---|---|
| Texas | $0 | 8.25% | ~1.8% |
| California | ~$5,300 | 8.82% | ~0.75% |
| Florida | $0 | 7.02% | ~0.83% |
As you can see, while Texas saves you $5,300 in income tax vs California, the property tax on a $500,000 home in Texas ($9,000/yr) would be double that of California ($3,750/yr), potentially erasing the savings.