States With Lowest Taxes 2020

We’ve all heard the adage, “Nothing is certain except death and taxes.” We all know that we have to pay taxes if we live in the United States, but did you know that some states have lower tax rates than others? Some states also may eliminate certain taxes, but often, they’re merely paying more in other types of taxes.

Adult citizens in the United States pay a variety of different taxes. We pay taxes to the federal government. We also pay local and state taxes. It isn’t just your annual state tax return, either. We pay property taxes, sales taxes, and other taxes that help fund things like schools, roads, and critical infrastructure.

Because there are so many different types of taxes, there isn’t just one list of states with the lowest tax rates. For example, property tax in one state may be much lower but personal income tax may be much higher. But we can break down the states with the lowest taxes based on tax type.

In 2018, it was found that Louisiana had the lowest property tax rate at 0.18%. Hawaii came in second with a property tax rate of 0.26%. Alabama has the third-lowest property taxes at 0.33%.

The top 10 states with the lowest property tax rates in 2018 were:

When it comes to states with the lowest personal income tax rates, there are several that top the list because they have no personal income tax. Those states are:

When it comes to sales tax, five states do not have charge sales tax. Those states are:

It’s important to note that local municipalities in Montana and Alaska can impose a sales tax.

The organization Tax Foundation released a report in 2018 that evaluated local taxes to determine which states were the most tax-friendly. This report showed that the states with the lowest taxes were:

  • Alaska
  • South Dakota
  • Wyoming
  • Tennessee
  • Texas
  • Louisiana
  • New Hampshire
  • Nevada
  • South Carolina
  • Mississippi
* Rank based on normalized and combined rates for single filers with no dependents or deductions. Income tax is weighted 70%; sales tax at 30%.
State Tax Rank Income Tax Sales Tax 2020 Pop.
New Hampshire10.00%0.00%1,371,246
Alaska20.00%0.00%734,002
Wyoming30.00%4.00%567,025
South Dakota40.00%4.00%903,027
Florida50.00%6.00%21,992,985
Texas60.00%6.25%29,472,295
Washington70.00%6.50%7,797,095
Nevada80.00%6.85%3,139,658
Tennessee90.00%7.00%6,897,576
North Dakota103.22%5.00%761,723
Pennsylvania113.07%6.00%12,820,878
Colorado124.63%2.90%5,845,526
Indiana133.40%7.00%6,745,354
Delaware146.60%0.00%982,895
Alabama155.00%4.00%4,908,621
Michigan164.25%6.00%10,045,029
Montana176.90%0.00%1,086,759
Arizona184.54%5.60%7,378,494
Utah195.00%4.70%3,282,115
New Mexico204.90%5.13%2,096,640
Oklahoma215.25%4.50%3,954,821
Kansas224.80%6.50%2,910,357
Virginia235.75%4.30%8,626,207
Illinois245.00%6.25%12,659,682
Louisiana256.00%4.00%4,645,184
Georgia266.00%4.00%10,736,059
Missouri276.00%4.23%6,169,270
North Carolina285.80%4.75%10,611,862
Ohio295.39%5.75%11,747,694
Massachusetts305.20%6.25%6,976,597
Mississippi315.00%7.00%2,989,260
Maryland325.75%6.00%6,083,116
Kentucky336.00%6.00%4,499,692
Rhode Island345.99%7.00%1,056,161
West Virginia356.50%6.00%1,778,070
Nebraska366.84%5.50%1,952,570
Connecticut376.70%6.35%3,563,077
South Carolina387.00%6.00%5,210,095
Arkansas397.00%6.50%3,038,999
Wisconsin407.65%5.00%5,851,754
Oregon419.90%0.00%4,301,089
Idaho427.40%6.00%1,826,156
Maine437.95%5.50%1,345,790
New York448.82%4.00%19,440,469
Vermont468.95%6.00%628,061
Iowa478.98%6.00%3,179,849
New Jersey488.97%7.00%8,936,574
Hawaii4911.00%4.00%1,412,687
Minnesota509.85%6.88%5,700,671
California5113.30%7.50%39,937,489