Which States Do Not Pay Income Tax?
Residents of all states are responsible for paying federal income taxes, but seven states, Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming, do not have a state income tax. As of 2009, Hawaii has the highest tax bracket at 11 percent for income over $200,000.
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Interest and Dividends Only
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Two states, New Hampshire and Tennessee, only tax income that comes from interest and dividends.
Highest Deduction
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Wisconsin has the highest standard deduction for state income taxes. For 2009, single filers can deduct $8,960 and joint filers can take a standard deduction of $16,140.
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Highest Personal Exemption
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Connecticut has the highest personal exemption at $13,000. However, for every $1,000 over $27,000 your adjusted gross income is, the amount of your personal exemption decreases by $1,000. For example, if your adjusted gross income is $33,000, your personal exemption drops to $7,000.
Smallest Tax Rate for a Tax Bracket
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As of 2009, Iowa taxes the first $1,407 of taxable income at 0.36 percent.
Federal Tax Deduction
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Oregon, Montana, Missouri, Louisiana, Iowa and Alabama allow residents to deduct federal taxes that they pay from their taxable income. Oregon caps this deduction at $5,600 and Missouri caps it at $5,000 for singles and $10,000 for couples filing a joint return.
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References
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Comments
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See this is the staff I am talking about... All 50 States are required to pay Federal Taxes. Out of 50 states; 7 DOES NOT PAY STATE TAXES! Guess the 2 out of the 7 bunch? ALASKA & TEXAS! See I’m tired of these political games. Sarah “Ignant beyond Ignorant” Palin making all these TV appearances and her state DOES NOT even pay STATE TAXES? TEXAS has the largest group of TEA PARTIES and yet their running around talking about taxes BUT DO NOT PAY STATE? Stop running around talking about our president; instead discuss how you plan to ban STATE TAX everywhere! That’s what this country need IGNANT!
