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.
By Michael Dang, CostByState Research Team · 2026-07-08
"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 $35,316 per year after covering costs, versus $32,882 for the states that do tax income. South Dakota leads overall at $42,256 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 | $36,924 | $42,256 |
| 2 | North Dakota | 0.0%–2.5% | $78,489 | $37,524 | $40,965 |
| 3 | Wyoming | No income tax | $79,180 | $38,652 | $40,528 |
| 4 | Arkansas | 0.0%–3.7% | $75,939 | $35,412 | $40,527 |
| 5 | Mississippi | 0.0%–4.0% | $75,912 | $35,544 | $40,368 |
| 6 | Louisiana | 3.00% flat | $76,555 | $36,360 | $40,195 |
| 7 | West Virginia | 2.1%–4.6% | $75,489 | $35,712 | $39,777 |
| 8 | Tennessee | No income tax | $79,180 | $39,504 | $39,676 |
| 9 | Iowa | 3.80% flat | $75,992 | $36,396 | $39,596 |
| 10 | Oklahoma | 0.0%–4.5% | $75,181 | $36,276 | $38,905 |
| 11 | Kentucky | 3.50% flat | $75,794 | $37,080 | $38,714 |
| 12 | Ohio | 2.75% flat | $77,146 | $38,568 | $38,578 |
| 13 | Alabama | 2.0%–5.0% | $75,079 | $36,612 | $38,467 |
| 14 | Missouri | 0.0%–4.7% | $75,413 | $37,860 | $37,553 |
| 15 | Indiana | 2.95% flat | $76,260 | $39,000 | $37,260 |
| 16 | Nebraska | 2.5%–4.5% | $75,497 | $38,244 | $37,253 |
| 17 | Kansas | 5.2%–5.6% | $74,400 | $37,596 | $36,804 |
| 18 | New Mexico | 1.5%–5.9% | $75,611 | $38,940 | $36,671 |
| 19 | Texas | No income tax | $79,180 | $43,140 | $36,040 |
| 20 | North Carolina | 3.99% flat | $75,699 | $40,344 | $35,355 |
| 21 | Wisconsin | 3.5%–7.6% | $74,679 | $39,864 | $34,815 |
| 22 | South Carolina | 2.0%–5.2% | $74,936 | $40,164 | $34,772 |
| 23 | Alaska | No income tax | $79,180 | $44,412 | $34,768 |
| 24 | Pennsylvania | 3.07% flat | $76,110 | $41,592 | $34,518 |
| 25 | Michigan | 4.25% flat | $75,177 | $40,812 | $34,365 |
| 26 | Montana | 4.7%–5.7% | $74,891 | $40,944 | $33,947 |
| 27 | Vermont | 3.4%–8.8% | $75,011 | $41,808 | $33,203 |
| 28 | Idaho | 0.0%–5.3% | $75,148 | $41,976 | $33,172 |
| 29 | Georgia | 4.99% flat | $74,939 | $41,868 | $33,071 |
| 30 | Maine | 5.8%–7.1% | $73,622 | $40,656 | $32,966 |
| 31 | Nevada | No income tax | $79,180 | $46,284 | $32,896 |
| 32 | New Hampshire | No income tax | $79,180 | $47,412 | $31,768 |
| 33 | Arizona | 2.50% flat | $77,074 | $45,372 | $31,702 |
| 34 | Minnesota | 5.3%–9.8% | $73,869 | $42,912 | $30,957 |
| 35 | Florida | No income tax | $79,180 | $48,288 | $30,892 |
| 36 | Rhode Island | 3.8%–6.0% | $76,006 | $45,408 | $30,598 |
| 37 | Illinois | 4.95% flat | $74,371 | $43,848 | $30,523 |
| 38 | Utah | 4.45% flat | $74,730 | $45,204 | $29,526 |
| 39 | Delaware | 0.0%–6.6% | $73,811 | $44,412 | $29,399 |
| 40 | Washington | No income tax | $79,180 | $50,160 | $29,020 |
| 41 | Virginia | 2.0%–5.8% | $74,191 | $45,708 | $28,483 |
| 42 | Connecticut | 2.0%–7.0% | $74,430 | $47,472 | $26,958 |
| 43 | Colorado | 4.40% flat | $75,488 | $49,092 | $26,396 |
| 44 | Oregon | 4.8%–9.9% | $71,981 | $46,680 | $25,301 |
| 45 | Massachusetts | 5.0%–9.0% | $74,400 | $49,668 | $24,732 |
| 46 | New York | 3.9%–10.9% | $74,320 | $49,884 | $24,436 |
| 47 | Maryland | 2.0%–6.5% | $71,846 | $48,732 | $23,114 |
| 48 | New Jersey | 1.4%–10.8% | $75,000 | $51,972 | $23,028 |
| 49 | Hawaii | 1.4%–11.0% | $73,297 | $50,880 | $22,417 |
| 50 | California | 1.0%–13.3% | $74,126 | $55,332 | $18,794 |
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.