Which is the best state to live in for taxes?

Best States for Taxes: Where Your Paycheck Goes Further

If you're looking to keep more of your hard-earned money, where you live makes a big difference. While no state is completely tax-free, several offer significant advantages—especially if you're in your peak earning years.

Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming don’t tax personal income at the state level, making them especially appealing for high earners. That means your salary, bonuses, and wages aren’t hit with a state income tax, giving you more take-home pay compared to residents in states like California or New York.

Take Texas and Florida, for example—both are popular destinations for remote workers and entrepreneurs who want to leverage the lack of income tax while building wealth. Texas, with its booming cities and low regulatory environment, has attracted a steady stream of transplants from higher-tax states. Florida, with its sunny climate and no state tax, has long been a favorite for retirees and professionals alike.

But it’s not all about income tax. Some of these states make up for lost revenue in other ways—like higher property or sales taxes. Washington, for instance, relies heavily on sales tax, which can hit lower-income households harder. Still, for those with substantial salaries, the trade-off is often worth it.

Alaska, funded largely by oil revenues, doesn’t just skip income tax—it occasionally sends residents a dividend check from the state’s Permanent Fund. And while New Hampshire and Tennessee don’t tax wages, they do tax investment income, though Tennessee recently phased out its so-called "Hall tax" on interest and dividends.

Ultimately, the best state for taxes depends on your income type, lifestyle, and long-term plans. But for high earners focused on maximizing their paycheck, the no-income-tax states remain powerful contenders. With careful planning, living in one of these states could mean more room in your budget—and more freedom in your financial future.