Where you live directly determines a significant portion of your annual tax burden. In 2026, nine states collect no state income tax at all, while California taxes top earners at 13.3 percent. For a household earning $150,000 per year, the difference between a no-tax state and California can exceed $15,000 annually in state income tax alone. This guide gives you the complete, ranked picture of state income tax rates and what they actually mean for your take-home pay.
States with No Income Tax in 2026
State income tax top marginal rates 2026 · Source: Tax Foundation · IRS · taxcutscalculator.com
Nine states impose no broad-based individual income tax:
- Alaska — No income tax; residents receive an annual Permanent Fund Dividend
- Florida — No income tax; funds government through sales and property taxes
- Nevada — No income tax; gaming and tourism revenue replaces it
- New Hampshire — No tax on wages (interest and dividend tax fully repealed in 2025)
- South Dakota — No income tax; among the most tax-friendly states overall
- Tennessee — No wage tax (Hall Tax on investment income repealed in 2021)
- Texas — No income tax; offset by higher property tax rates
- Washington — No income tax on wages (capital gains tax on high earners began 2023)
- Wyoming — No income tax; mineral extraction revenue funds government
Highest and Lowest State Income Tax Rates (2026)
| State | Top Rate | Brackets | Notes |
|---|---|---|---|
| California | 13.30% | 10 | Highest in U.S.; applies above $1M income |
| Hawaii | 11.00% | 12 | Top rate on income over $400,000 |
| New Jersey | 10.75% | 7 | Millionaire's tax on income over $1M |
| Oregon | 9.90% | 4 | Top bracket starts at $125,000 (single) |
| Minnesota | 9.85% | 4 | Top bracket on income over $183,340 |
| Vermont | 8.75% | 4 | |
| Wisconsin | 7.65% | 4 | |
| Maine | 7.15% | 3 | |
| Colorado | 4.40% | 1 | Flat tax; reduced from 4.55% in 2024 |
| Pennsylvania | 3.07% | 1 | Flat tax on all income |
| Indiana | 3.05% | 1 | Flat rate; reduced from 3.23% in prior years |
| Arizona | 2.50% | 1 | Flat rate implemented 2023 |
| North Dakota | 2.50% | 3 | Lowest among income-tax states |
How Federal TCJA Changes Ripple Into State Taxes
Many states calculate their income tax starting from your federal adjusted gross income (AGI). If TCJA standard deduction provisions change at the federal level, your state taxable income shifts proportionally in conformity states — even if your state's own rates remain unchanged. States that start from federal AGI include New York, Virginia, North Carolina, Georgia, Illinois, and Michigan. Key states with independent deduction systems include California, New Jersey, Pennsylvania, and Ohio.
Methodology
Rate data sourced from the IRS, Tax Foundation 2026 State Individual Income Tax Rates report, and individual state revenue department publications. Top marginal rates are shown; effective rates for middle-income households are substantially lower due to graduated brackets and deductions.
Model Your State Tax Savings
Marginal rates only tell part of the story. Use our tax cuts calculator to model your effective rate under current 2026 federal and state law, compare scenarios, and see exactly how much a different filing strategy — or a different state of residence — could save you.