Tennessee 2023 State Income Tax Brackets
No state income tax — see key tax facts below
Tennessee Has No State Income Tax
Residents of Tennessee pay no state-level income tax, keeping more of every paycheck. No income tax on wages. Hall Tax (dividends/interest) fully repealed as of 2021.
2023 Federal vs. Tennessee State Tax Rates
Federal top marginal rate
37%
Tennessee top marginal rate
0%
When combined with federal taxes, Tennessee residents in the highest bracket face a combined marginal rate of approximately 37% on their last dollar of income.
Key Tax Facts: Tennessee in 2023
Sales Tax Rate
7%
State rate (local taxes may add more)
Property Tax Rate
0.71%
Effective average rate on home value
Income Tax
No state tax
One of 9 no-tax states
Retirement Income
Exempt / Favorable
Most retirement income not taxed
Social Security
Not taxed
Social Security exempt from state tax
Estate / Inheritance Tax
No
No estate or inheritance tax
Other Tax Years
Federal Brackets by Filing Status (2023)
Other States — 2023 Tax Brackets
Frequently Asked Questions — Tennessee State Taxes
Does Tennessee have a state income tax?
No. Tennessee does not impose a state individual income tax, meaning residents pay no additional state-level income tax on wages or salaries. No income tax on wages. Hall Tax (dividends/interest) fully repealed as of 2021.
How do Tennessee tax brackets work?
Since Tennessee has no income tax, this question doesn't apply. However, residents still pay federal income tax and FICA taxes (Social Security and Medicare). Use the Paycheck Calculator to estimate total take-home pay.
What is the difference between marginal and effective tax rate in Tennessee?
Your marginal tax rate is the rate on your highest dollar of income. Your effective tax rate is your total state tax bill divided by your gross income — always lower than your marginal rate. For example, a worker at the top bracket in Tennessee may have a marginal rate of N/A but an effective rate several points lower due to income in lower brackets.
When were Tennessee's tax brackets last updated?
The brackets shown here reflect 2023 rates as enacted by Tennesseelegislation and published by the state Department of Revenue. CalcFi updates state tax data annually following each state's legislative session. Data sourced from official state tax agency publications and the Tax Foundation. Last updated: March 2025.