For residents of certain states, the absence of a state income tax can be a significant tax benefit. Instead of paying personal income tax rates to the state, individuals in these states only pay federal income tax on their taxable income.
However, states with no income tax often generate revenue in other ways, such as higher property taxes, sales tax or excise taxes.
While skipping a state income tax might lower your overall tax bill, other state taxes can offset those savings. Some states rely on property tax rates, while others use higher sales tax or taxes on dividend income and capital gains income to balance their budgets. Here are the 9 states that do not levy a state income tax, listed in alphabetical order.
