How Tennessee paychecks work (2026)
In Tennessee, your take-home pay is your salary minus federal income tax, FICA (Social Security 6.2% + Medicare 1.45%) — and that's it, because Tennessee has no state income tax. This calculator uses the official 2026 rates for a single filer. Since the Hall tax was repealed in 2021, even interest and dividends are now free of state tax.
Tennessee state income tax
Tennessee has no state income tax on wages. You only pay federal income tax and FICA.
Example: $80,000 in Tennessee
On $80,000 in Tennessee, federal tax is about $8,770 and FICA $6,120, leaving roughly $65,110 — and since the Hall tax on interest and dividends ended in 2021, even investment income is now state-tax-free. The cost surfaces at the till instead: Tennessee's combined sales tax is among the highest in the US.
Tennessee take-home pay by salary (2026)
Estimated annual take-home for a single filer after federal income tax, Social Security and Medicare — Tennessee has no state income tax, using the 2026 rates. Figures are tax liability, not withholding.
| Gross salary | Take-home / year | Per month | % kept |
|---|---|---|---|
| $40,000 | $34,320 | $2,860 | 85.8% |
| $60,000 | $50,390 | $4,199 | 84.0% |
| $80,000 | $65,110 | $5,426 | 81.4% |
| $100,000 | $79,180 | $6,598 | 79.2% |
| $150,000 | $113,791 | $9,483 | 75.9% |
What often catches people out in Tennessee
- Tennessee has no wage income tax, and the old 'Hall tax' on interest and dividends was fully repealed in 2021 — so investment income is now untaxed too.
- The trade-off is one of the highest combined sales-tax rates in the US (~9.5% with local).
- No state income-tax return to file.
Tennessee's trade-off is the most measurable of any no-tax state
Of the states with no wage income tax, Tennessee is the one where you can actually put a number on what replaced it — because the replacement is almost entirely sales tax, and sales tax is easy to compute against a household budget.
The state rate is 7% on most goods and services. Local governments add an option tax of up to 2.75%, set in multiples of 0.25, so the combined rate reaches 9.75% in much of the state. Groceries get a break: food and food ingredients are taxed at a reduced state rate of 4% plus the local rate — but "food ingredients" excludes prepared food, candy, dietary supplements, alcohol and tobacco, which stay at the full 7%.
Work it through on the $80,000 salary in the calculator above. Take-home is about $65,110. Suppose $12,000 of that goes on groceries and $18,000 on other taxable spending in a county at the full 9.75%. Groceries at 4% state plus 2.75% local is 6.75%, so about $810; other goods at 9.75% is about $1,755. That is roughly $2,565 a year in sales tax — around 3.9% of take-home. A state income tax of 3.9% on $80,000 would be about $3,120, so on this spending pattern Tennessee still comes out ahead. Change the pattern and the answer changes: sales tax is a bigger share of income the less you save, which is why the same rate lands harder on lower earners.
The other half of the story is what Tennessee removed rather than added. The Hall tax on interest and dividends — the last piece of income tax the state levied — was phased out and gone by 2021. So investment income is now untaxed at state level too, which is unusual even among no-income-tax states and matters a great deal in retirement. Source: Tennessee Department of Revenue — Sales and Use Tax Rates and SUT-53, Food and Food Ingredients.
What this calculator does not include
- Local/city taxes (none), 401(k) and pre-tax deductions, and filing statuses other than single.
- It shows tax liability, which can differ from paycheck withholding (employers often over-withhold).
Does Tennessee tax my income?
No — Tennessee has no state income tax on wages.
What's FICA?
Social Security (6.2%) and Medicare (1.45%) payroll taxes, deducted in every state including Tennessee.
More United States calculators
This calculator provides estimates for a single filer in Tennessee for 2026 based on IRS and state figures and is for general information only — it is not financial or tax advice. It excludes local taxes, 401(k) and other deductions, and shows tax liability rather than withholding. Sources: IRS (Rev. Proc. 2025-32), Tennessee Department of Revenue.