no state income tax
Two states with no income tax do tax your investment earnings.
- $4, when tax returns are due for income earned in 2019, is April 15.
- Most Americans file a $4 return and a federal income tax return.
- If you live in one of nine states with no income tax, you may not need to $4 a state return.
- $4
Tax day 2020 is Wednesday, April 15.
If you owe at least $5 in federal income taxes, you have to $4 a federal tax return. Some people, however, are off the hook when it comes to filing a state tax return.
That's because seven US states don't impose $4 - Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming.
New Hampshire and Tennessee don't tax earned income either, but they do tax investment income - in the form of interest and dividends - at 5% and 2%, respectively. If you live in either state and received income from your investments, $4.
The other 41 states have either a flat income tax - meaning everyone, regardless of how much they earn, pays the same percentage of their income to the government - or a $4, which means your tax rate is determined by your income.
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But living in a state with no income tax doesn't necessarily mean you're getting off scot-free. Texas and New Hampshire, for instance, may not tax your earnings, but they do have some of the highest $4 in the country, which could ding you if you're a property owner.
Likewise, Tennessee doesn't tax your paycheck, but it will get you in the checkout line. The state has one of the $4 in the country at 7%.
Still, everyone is subject to federal income taxes regardless of where you live. How much you pay depends on how much you earn, also known as your $4. In 2018, about 76 million Americans didn't owe federal income tax because their earnings were too low.
After you file your taxes, you may get $4 or a federal tax refund - or both if you live in a state that taxes income. The IRS says $4 is the method already used by most taxpayers: filing electronically and selecting direct deposit as the method for receiving your refund.
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