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9 States In the US You Will Not Have To Pay Income Tax

9 States In the US You Will Not Have To Pay Income Tax( Photo: Marca)

In an ideal world, we would not have to pay income tax every time we bought something. However, not paying taxes does not imply that the government bears all of the state’s costs.

What is income tax?

Annuity.org cited that income taxes are imposed by the federal, state, and local governments on the earnings of individuals and businesses. These taxes are typically levied as a percentage of income, but the rate may vary depending on the type of income, the amount of income, or the taxpayer.

Why Do States Implement a State Tax?

According to Investopedia, following the implementation of the U.S. the federal government was given the authority to levy taxes on its citizens by the Constitution. Each state also retained the right to levy whatever taxes it wished, with the exception of those prohibited by federal law. As well as the United States Constitution, each state has its own constitution. These states’ governments are supported by taxation, fees, and licenses.

9 States In the US You Will Not Have To Pay Income Tax(Photo: CNBC)

List Of States That Exclude Residents From Paying Income Taxes

Alaska, Florida, Texas, South Dakota, Nevada, New Hampshire, Tennessee, Wyoming, and Washington are currently the only states that do not collect personal income taxes.

If you live in these state that does not have individual income taxes, you will not have to pay taxes on your wages or income from Social Security, pensions, or retirement plans like 401(k)s or individual retirement accounts (IRA). Taxpayers in these states, however, are still subject to other types of taxes, such as local taxes, property taxes, and sales taxes.

 

 

Read also:

You Won’t Have To Pay Social Security Tax If You Live In Any Of These States

Federal Unemployment Tax Act: Do You Have To Pay It?

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