Tennessee Take-Home Pay Calculator
No State Income TaxEstimate your net paycheck after federal taxes, FICA, and Tennessee state income tax.
Last updated: April 2026
Tennessee Income Tax
Tennessee does not tax wages or salary income. The Hall Tax on investment income was eliminated in 2021.
Tennessee State Income Tax: What You Need to Know
Tennessee does not tax wages or salary income. The Hall Tax on investment income was eliminated in 2021.
Tennessee has no state income tax on wages, salaries, or self-employment income. The Hall Tax — a 6% tax on interest and dividend income — was phased out and fully eliminated on January 1, 2021. Tennessee is now a fully no-income-tax state. Tennessee funds its government primarily through a 7% state sales tax (one of the highest in the country), plus local additions that push the combined rate to 9.55% in some areas. Tennessee cities and counties cannot levy a local income tax on wages.
Living in a no-income-tax state gives you an immediate take-home pay advantage compared to workers in high-tax states. A worker earning $80,000 in Tennessee takes home approximately $6,000–$8,000 more per year than an equivalent worker in California or Oregon.
However, states without income taxes often offset revenue through higher property taxes, sales taxes, or fees. When comparing the overall tax burden between states, consider all taxes — not just income tax.
Tennessee Take-Home Pay Examples (2026, Single Filer)
Estimates based on standard deduction, no pre-tax deductions. Last updated: April 2026.
| Salary | Federal Tax | State Tax | FICA | Take-Home |
|---|---|---|---|---|
| $40,000 | $3,167 | $0 | $3,060 | $33,773 |
| $60,000 | $6,617 | $0 | $4,590 | $48,793 |
| $80,000 | $10,817 | $0 | $6,120 | $63,063 |
| $100,000 | $15,617 | $0 | $7,650 | $76,733 |
Frequently Asked Questions: Tennessee Taxes
Does Tennessee have a state income tax?
No. Tennessee has no state income tax on wages, salaries, or self-employment income. Tennessee's Hall Tax on interest and dividend income was fully eliminated in 2021. Tennessee workers pay only federal income tax and FICA on their paychecks — no state withholding at all.
What was Tennessee's Hall Tax?
The Hall Tax was a 6% tax on interest and dividend income — not on wages. It affected investors receiving stock dividends and bond interest, not typical workers. The Hall Tax was phased down from 6% to 1% between 2016 and 2020 and eliminated entirely on January 1, 2021. Tennessee workers were never subject to it.
How does Tennessee fund its government without income taxes?
Tennessee relies heavily on a 7% state sales tax — one of the highest state sales tax rates in the country. Local additions push combined rates to 9.55% in some jurisdictions. Tennessee also has franchise and excise taxes on businesses and various severance and privilege taxes. The high sales tax funds Tennessee's government without taxing wage income.
Does Tennessee have a local income tax on wages?
No. Tennessee cities and counties cannot impose a local income tax on wages. Nashville, Memphis, Knoxville, and all other Tennessee communities have no local wage tax. Workers pay only federal income tax and FICA — nothing at the state or local level on wages.
Is Tennessee a better deal than a state with income tax?
For wage earners: generally yes, especially at higher incomes. A $100,000 earner saves $4,500–$6,000/year compared to a state with a 4.5–6% income tax. However, Tennessee's high sales tax (up to 9.55%) is a partial offset for heavy spenders. Groceries are taxed at 4% in Tennessee, which is unusual — most states exempt food from sales tax.
What is Tennessee's minimum wage in 2026?
Tennessee has no state minimum wage and defaults to the federal minimum of $7.25/hour. Tennessee has not enacted a state minimum above the federal floor. Tennessee law preempts cities from setting higher local minimums.