Nine states charge no income tax on wages: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. But no income tax does not automatically mean low overall taxes or a low cost of living. Property taxes, sales taxes, and living costs vary dramatically between these states. Here are the best cities to live in across no-income-tax states, ranked by the total financial picture.
Texas is the most popular no-income-tax state for relocators, and its cities offer tremendous variety. Austin is the tech and cultural hub with a median home price around $480,000 and a booming job market. San Antonio is the affordability champion at $275,000 median home price with a strong military and healthcare economy. Dallas-Fort Worth offers corporate headquarters density (AT&T, American Airlines, Texas Instruments) with suburban housing in the $350,000 to $450,000 range. Houston has the most diverse economy spanning energy, healthcare (the Texas Medical Center is the world's largest), and aerospace. The Texas trade-off is property taxes averaging 1.6 to 2.1% of assessed value, which partially offsets the income tax savings, especially for homeowners with expensive properties.
Florida's no-income-tax status is a major draw, particularly for retirees whose Social Security and pension income remains fully untaxed. Tampa offers the best balance of affordability ($380,000 median) and job market strength. Jacksonville is the budget pick at $310,000 median. Sarasota and Naples cater to retirees with beach living and cultural amenities. Miami offers the most dynamic economy but at a premium cost exceeding $550,000 median. The Florida trade-off is homeowners insurance, which averages $4,200 per year and is climbing. Flood insurance adds more. When you factor in insurance costs, Florida's total housing expense is higher than the purchase price alone suggests.
Tennessee eliminated its tax on investment income (the Hall Tax) in 2021, making it fully income-tax-free. Nashville is the headliner with a booming healthcare and tech economy, but at a $440,000 median home price it is no longer the bargain it once was. Knoxville offers a lower $295,000 median with University of Tennessee employment and Smoky Mountain proximity. Chattanooga is a hidden gem with a $290,000 median, one of the fastest municipal internet networks in the country (EPB Fiber), and a revitalized downtown. Memphis at $220,000 median is the cheapest major Tennessee city with FedEx as the dominant employer. Tennessee's sales tax is 7% (one of the highest in the nation) plus local additions reaching 9.75% in Nashville.
Washington State combines no income tax with some of the highest salaries in the country, making it financially compelling for high earners. Seattle is the obvious draw with tech salaries starting above $120,000 for engineers, but housing is expensive at $780,000 median. Tacoma offers a more affordable alternative at $440,000 with improving amenities and a 30-minute train ride to Seattle. Spokane on the eastern side is dramatically cheaper at $350,000 median, with a growing remote worker community. Olympia and Bellingham are smaller options with strong community character. The Washington trade-off is a 10.25% sales tax in Seattle (one of the highest in the nation) and generally high cost of living outside of Spokane.
Las Vegas is Nevada's standout with $410,000 median home prices, affordable Western living, and year-round entertainment. Reno has grown rapidly with Tesla's Gigafactory and data centers driving job growth, though housing has climbed to $500,000 median. South Dakota's Sioux Falls is a surprisingly vibrant small city at $300,000 median with a strong healthcare and financial services economy (Citibank, Wells Fargo). Wyoming's Cheyenne and Casper offer the lowest tax burdens in the nation (no income tax, low property taxes, low sales tax) but very limited job markets and harsh winters. New Hampshire taxes investment income but not wages, and its cities like Manchester and Nashua benefit from proximity to Boston with dramatically lower housing costs.
Moving to a no-income-tax state does not guarantee lower overall taxes. A household earning $100,000 in Texas saves about $5,000 to $7,000 in state income tax compared to California, but Texas property taxes on a $400,000 home run $7,200 to $8,400 per year versus about $4,400 in California. The math depends on your income level, home value, and spending habits (sales tax matters more for higher spenders). Use a total tax burden calculator and our moving cost calculator together to compare your all-in financial picture. For renters and high earners, no-income-tax states are almost always beneficial. For homeowners with moderate incomes, the analysis is more nuanced and requires running the specific numbers for your situation.
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Wyoming and South Dakota have the lowest total tax burdens, combining no income tax with low property and sales taxes. However, they have limited job markets and smaller populations. Among large states, Tennessee and Florida offer the best combination of no income tax and moderate other taxes, especially for retirees.
Texas has no state income tax, but property taxes are among the highest in the nation at 1.6 to 2.1% of assessed value. A $400,000 home in Texas generates $6,400 to $8,400 in annual property taxes. Sales tax is also relatively high at 6.25% state plus local additions. For renters and high earners, Texas is still a great deal. For homeowners with moderate incomes, the savings are smaller than expected.
Not necessarily. Washington State and Nevada have no income tax but above-average costs of living driven by housing. Tennessee and Texas offer no income tax plus below-average costs in most cities. Alaska has no income tax and no sales tax but extremely high costs for groceries, utilities, and housing due to its remote location.
Statistics and cost figures are based on industry averages and publicly available data, provided for informational purposes.
Data last reviewed: March 2026. Learn about our data
