Do No-Income-Tax States Actually Cost Less? (2026)

No state income tax sounds like a raise. We checked whether it really leaves you better off once cost of living is in the picture.

"No state income tax" is one of the most repeated reasons people move. It sounds like an instant raise — and on your paycheck, it is. But a paycheck is only half of the equation. What matters is what's left after you also pay to live there. So we combined both: for a single filer earning $100,000, we took annual take-home pay and subtracted the annual cost of living in each state.

Across our 10 launch states, the no-income-tax states leave about $35,415 per year after covering costs, versus $32,138 for the states that do tax income. South Dakota leads overall at $39,844 left over — showing that the tax label alone doesn't decide the winner.

#	State	Income tax	Take-home ($100k)	Annual cost	Left over
1	South Dakota	No income tax	$79,180	$39,336	$39,844
2	North Dakota	0.0%–2.5%	$78,489	$39,492	$38,997
3	Tennessee	No income tax	$79,180	$40,788	$38,392
4	Wyoming	No income tax	$79,180	$41,148	$38,032
5	Louisiana	3.00% flat	$76,555	$39,168	$37,387
6	Mississippi	0.0%–4.0%	$75,672	$38,604	$37,068
7	Iowa	3.80% flat	$75,992	$38,964	$37,028
8	Oklahoma	0.0%–4.5%	$75,181	$39,000	$36,181
9	Texas	No income tax	$79,180	$43,092	$36,088
10	Ohio	2.75% flat	$77,146	$41,196	$35,950
11	Kentucky	3.50% flat	$75,794	$40,032	$35,762
12	West Virginia	2.1%–4.6%	$75,489	$39,744	$35,745
13	Nebraska	2.5%–4.5%	$75,322	$39,996	$35,326
14	Missouri	0.0%–4.7%	$75,413	$40,320	$35,093
15	Indiana	2.95% flat	$76,260	$41,436	$34,824
16	Nevada	No income tax	$79,180	$44,400	$34,780
17	New Mexico	1.5%–5.9%	$75,611	$40,932	$34,679
18	Kansas	5.2%–5.6%	$73,889	$39,972	$33,917
19	North Carolina	3.99% flat	$75,699	$41,880	$33,819
20	Alaska	No income tax	$79,180	$45,432	$33,748
21	Florida	No income tax	$79,180	$45,924	$33,256
22	New Hampshire	No income tax	$79,180	$46,260	$32,920
23	Montana	4.7%–5.7%	$74,891	$42,024	$32,867
24	Pennsylvania	3.07% flat	$76,110	$43,320	$32,790
25	Idaho	0.0%–5.3%	$74,988	$42,396	$32,592
26	Michigan	4.25% flat	$75,177	$42,720	$32,457
27	Arizona	2.50% flat	$77,074	$44,700	$32,374
28	Georgia	4.99% flat	$74,939	$42,744	$32,195
29	Washington	No income tax	$79,180	$47,508	$31,672
30	Vermont	3.4%–8.8%	$74,690	$43,500	$31,190
31	Maine	5.8%–7.1%	$73,622	$43,092	$30,530
32	Rhode Island	3.8%–6.0%	$75,761	$45,408	$30,353
33	Minnesota	5.3%–9.8%	$73,869	$43,776	$30,093
34	Illinois	4.95% flat	$74,371	$44,388	$29,983
35	Colorado	4.40% flat	$75,488	$45,756	$29,732
36	Delaware	0.0%–6.6%	$73,811	$44,316	$29,495
37	Virginia	2.0%–5.8%	$74,191	$44,880	$29,311
38	Massachusetts	5.0%–9.0%	$74,400	$46,944	$27,456
39	New Jersey	1.4%–10.8%	$75,000	$48,312	$26,688
40	New York	3.9%–10.9%	$74,320	$47,916	$26,404
41	Oregon	4.8%–9.9%	$70,988	$45,876	$25,112
42	California	1.0%–13.3%	$73,972	$49,164	$24,808
43	Hawaii	1.4%–11.0%	$73,297	$48,828	$24,469

Why the tax label can mislead

No income tax genuinely helps — the no-tax states cluster toward the top. But some no-tax states also carry high housing costs, which can erase the tax advantage, while a moderate-tax state with cheap housing can come out ahead. States without an income tax also tend to raise revenue through higher sales and property taxes that never appear on a pay stub. The honest takeaway: judge a state on take-home and cost of living together, not on the tax headline alone.

Compare any two states directly — including the salary you'd need to keep the same lifestyle — with our comparison tool.

Methodology

Take-home assumes a single filer, standard deduction, no pre-tax deductions, tax year 2026. Cost of living is the single-adult annual total from each state's regional price level. Sales and property taxes are not included in the cost figure. See our methodology.

Figures are computed from CostByState's cited data (see methodology) and updated monthly. For educational purposes only, not financial advice.