US States With The Lowest Income Tax
Several U.S. states have low or no income taxes, making them attractive for individuals seeking to minimize their tax burden. Here are the U.S. states with the lowest or no income tax:
1. States with No State Income Tax:
- Alaska: No state income tax.
- Florida: No state income tax.
- Nevada: No state income tax.
- South Dakota: No state income tax.
- Texas: No state income tax.
- Washington: No state income tax.
- Wyoming: No state income tax.
2. States with Flat or Low Income Tax Rates:
- New Hampshire: No tax on earned income but a 5% tax on interest and dividends.
- Tennessee: No tax on earned income but a 1% tax on interest and dividends (effective as of 2021).
- North Dakota: Has some of the lowest income tax rates in the U.S. with rates ranging from 1.1% to 2.9%.
- Pennsylvania: Has a flat income tax rate of 3.07%.
- Indiana: Has a flat income tax rate of 3.23%.
- Michigan: Has a flat income tax rate of 4.25%.
- Colorado: Has a flat income tax rate of 4.4%.
3. Other Low-Income Tax States:
- Arizona: Rates range from 2.59% to 4.5%, with a flat rate coming in 2025 at 2.5%.
- Illinois: Has a flat income tax rate of 4.95%.
- Missouri: Rates range from 1.5% to 5.4%, with some deductions available to lower the effective rate.
These states are often chosen by individuals and businesses seeking to reduce their state tax liability.
Recent News
