State Taxes for Immigrants: Which States and How Much
Updated April 12, 2026
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Quick answer
Nine US states have no state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. Immigrants who live in the remaining 41 states must file a state return and pay state income tax based on where they established tax residency, not necessarily where their visa was processed.
The Direct Answer
Where you live in the US determines your state tax obligation. Nine states have no income tax at all. The other 41 states - plus Washington D.C. - impose income taxes ranging from under 1% to over 13%. For immigrants, state tax residency depends on where you live and work, not the state where your employer is headquartered or where your visa was filed.
The Nine States With No Broad Income Tax
| State | Notes |
|---|---|
| Alaska | No income tax, no sales tax |
| Florida | No income tax; has sales tax |
| Nevada | No income tax; has sales tax |
| New Hampshire | Taxes interest and dividends only (not wages) |
| South Dakota | No income tax |
| Tennessee | No income tax (eliminated dividend tax in 2022) |
| Texas | No income tax; has property and sales tax |
| Washington | No income tax; taxes capital gains above $262,000 |
| Wyoming | No income tax |
Living in one of these states means you owe no state income tax on your wages - but you may still owe federal taxes and other state levies (sales tax, property tax).
High-Tax States Immigrants Often Live In
Many immigrants settle in states with significant income taxes because those states have large employer bases in tech, healthcare, finance, and academia.
| State | Top Marginal Rate | Notable Feature |
|---|---|---|
| California | 13.3% | Highest in the nation; taxes worldwide income of residents |
| New York | 10.9% | Plus New York City tax (up to 3.876%) |
| New Jersey | 10.75% | High property taxes as well |
| Oregon | 9.9% | No sales tax but high income tax |
| Minnesota | 9.85% | Taxes Social Security for higher earners |
| Hawaii | 11.0% | High cost of living combined with high tax |
How State Tax Residency Works for Immigrants
State tax residency is separate from federal tax residency and from immigration status. A state will consider you a tax resident if:
- You are domiciled in the state - meaning you intend it to be your permanent home, or
- You are a statutory resident - you maintained a permanent place of abode in the state and spent more than 183 days there during the year
Your visa type does not determine your state tax residency. An H-1B holder who lives and works in California is a California tax resident. A green card holder who moves to Texas pays no state income tax regardless of immigration status.
Partial-Year Residency
If you moved states during the tax year, you generally file:
- A part-year resident return for the state you left
- A part-year resident return for the state you moved to
- Both returns cover only the income earned while you were resident in each state
Nonresident State Filing
If you work in a state where you do not live (for example, you live in New Jersey but work in New York), you may need to file nonresident returns in both states. Most states with income taxes offer a credit for taxes paid to other states to prevent true double taxation.
Filing State Returns: Basic Steps
- Determine your residency status for each state (resident, part-year resident, or nonresident)
- Start with your federal adjusted gross income from Form 1040
- Apply state-specific additions and subtractions (states vary on what income they tax)
- Calculate the state tax owed using state tax brackets
- Apply any state credits (withholding, estimated payments, credits for taxes paid to other states)
Most states follow the federal filing deadline of April 15, though some states have different due dates. Check the specific state's department of revenue website.
The SALT Deduction Cap
The Tax Cuts and Jobs Act of 2017 capped the federal itemized deduction for state and local taxes (SALT) at $10,000 per year ($5,000 for married filing separately). This cap is scheduled to expire after 2025 unless Congress acts.
The SALT cap affects immigrants who:
- Live in high-tax states (California, New York, New Jersey, Oregon, Minnesota)
- Itemize deductions on their federal return
- Pay more than $10,000 per year in combined state income taxes and property taxes
Example: An immigrant family in California pays $18,000 in state income taxes and $9,000 in property taxes - a total of $27,000 in state and local taxes. Under the SALT cap, they can deduct only $10,000 of that on their federal return, losing the benefit of $17,000 in deductions.
State Taxes on Foreign Income
Some states - particularly California - are aggressive about taxing the worldwide income of their residents. California taxes all income of California residents regardless of source, and does not recognize the Foreign Earned Income Exclusion the way the federal government does. This means an immigrant living in California who works for a foreign employer may owe California state tax even on income the IRS has excluded under Form 2555.
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Start Free DiagnosticCommon Questions
Nine states have no broad-based state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. New Hampshire taxes interest and dividends but not wages. Washington taxes capital gains above $262,000 starting in 2022.
State tax residency is determined by domicile (the state you consider your permanent home) and by the number of days spent in the state. Most states use a 183-day rule: spending more than 183 days in a state makes you a statutory resident for tax purposes, even if your domicile is elsewhere.
The State and Local Tax (SALT) deduction cap, enacted in 2017, limits the federal deduction for state and local taxes to $10,000 per year ($5,000 for married filing separately). Immigrants in high-tax states like California, New York, or New Jersey who itemize deductions are most affected, since they may pay far more than $10,000 in state taxes but can only deduct $10,000 federally.
This article is educational information only. It is not tax, legal, or financial advice. For decisions specific to your situation, consult a licensed CPA or Enrolled Agent.