Income Tax

The income tax, as the name implies, is a tax on the money you earn as a result of having a job.  There are two types of income tax:  Federal and State.

Within the fifty states in our union, only nine do not levy a tax on a person’s individual working income.

STATES WITHOUT AN INCOME TAX

Texas:  Article 8, Section 24(a):

A general law enacted by the legislature that imposes a tax on the net incomes of natural persons, including a person’s share of partnership and unincorporated association income, must provide that the portion of the law imposing the tax not take effect until approved by a majority of the registered voters voting in a statewide referendum held on the question of imposing the tax. The referendum must specify the rate of the tax that will apply to taxable income as defined by law.

Tennessee: Article XI: Section 9:

The General Assembly shall not authorize any municipality to tax incomes,
estates, or inheritances, or to impose any other tax not authorized by Sections
28 or 29 of Article II of this Constitution. Nothing herein shall be construed as
invalidating the provisions of any municipal charter in existence at the time of
the adoption of this amendment.

New Hampshire: Article 28:

No subsidy, charge, tax, impost, or duty, shall be established, fixed, laid, or levied, under any pretext whatsoever, without the consent of the people, or their representatives in the legislature, or authority derived from that body.

Oregon:  Article IV, Section 32:

Notwithstanding any other provision of this
Constitution, the Legislative Assembly, in
any law imposing a tax or taxes on, in respect to or measured by income, may define
the income on, in respect to or by which
such tax or taxes are imposed or measured,
by reference to any provision of the laws of
the United States as the same may be or become effective at any time or from time to
time, and may prescribe exceptions or modifications to any such provisions. At each
regular session the Legislative Assembly
shall, and at any special session may, provide
for a review of the Oregon laws imposing a
tax upon or measured by income, but no such
laws shall be amended or repealed except by
a legislative Act.

Florida: Article VII, Section 5(b):

No tax upon the income of residents and citizens other than natural persons shall be
levied by the state, or under its authority, in excess of 5%
of net income, as defined by law, or at such greater rate
as is authorized by a three-fifths vote of the membership of each house of the legislature or as will provide for
the state the maximum amount which may be allowed to
be credited against income taxes levied by the United
States and other states. There shall be exempt from
taxation not less than five thousand dollars ($5,000) of
the excess of net income subject to tax over the maximum amount allowed to be credited against income
taxes levied by the United States and other states.

Wyoming: Article XV, Section 18:

No tax shall be imposed upon income without allowing full
credit against such tax liability for all sales, use, and ad valorem taxes paid
in the taxable year by the same taxpayer to any taxing authority in Wyoming.

South Dakota:  Article XI, Section 14:

Vote required to impose or increase taxes. The rate of taxation imposed by the State of South Dakota in regard to any tax may not be increased and no new tax may be imposed by the State of South Dakota unless by consent of the people by exercise of their right of initiative or by two-thirds vote of all the members elect of each branch of the Legislature.

Nevada:  Article X, Section 1(9):

No income tax shall be levied upon the wages or personal income of natural persons.

Washington:

I cannot locate the article in their constitution, nor can I find a law passed or repealed bill that clarifies the lack of an income tax.  If you can help clarify this, leave a comment on this page.

STATES WITH AN INCOME TAX

Personally, I would urge Americans in the remaining forty-one states to contact their state representatives to work on abolishing your states’ income tax.  My reasons are as follows:

  1. The federal government already taxes your income and does absolutely nothing good or productive with it.
  2. In the opinion of this blogger, if nine states can operate effectively without an income tax, why can’t the rest?
  3. States need to learn how to live within their means, consolidate bulky and redundant departments into something more effective that might cost less.
  4. States already collect hundreds of other taxes voluntarily with which to run government.  Capitalism only truly works when someone’s hard-earned income is not taxed.  It is also common sense that the less taxes you take from someone’s pay, the more money they have for themselves to spend, thus stimulating the economy.

As I started researching state income tax rates, it turns out that that rate is different depending on your taxable income for that fiscal year and whether you’re single, married/filing single, or married/filing jointly.

If you’re a numbers person and are trying to figure out tax rates in order to help determine cost of living, check with the state you’ll be working in.  The other option is to relocate to one of the nine that don’t tax personal/working income.

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