Which states have no income tax in 2026?

Nine: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. None of them withholds state tax from wages, bonuses, or RSU vests.

Are RSUs completely tax-free in Texas or Washington?

No — federal tax applies in full everywhere: 22% or 37% supplemental withholding, Social Security, and Medicare. What disappears is only the state layer on wages. In Washington, selling shares later can additionally trigger the state's 7%-9.9% capital gains excise.

Does Washington tax RSU vesting or only the sale?

Only the sale. Vesting is wage income, which Washington does not tax. Long-term gains realized when you sell — above the standard deduction ($278,000 for 2025, indexed) — are subject to the 7% excise, plus 2.9% on gains over $1 million.

If I move to a no-tax state before my RSUs vest, does my old state still tax them?

Often partially, yes. Most states source equity income earned while you worked there, typically by prorating workdays between grant and vest. Moving before a vest reduces but rarely eliminates the old state's claim.

States With No Income Tax on Wages (2026)

Nine states — Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming — withhold no state income tax from wages, bonuses, or RSU vests in 2026, though Washington taxes long-term capital gains at 7%–9.9% when shares are later sold.

For equity compensation, these states remove the entire state layer from vesting and bonus income: no supplemental rate, no aggregate withholding, nothing to reconcile on a state return. Federal treatment is unchanged — the 22%/37% supplemental rates and FICA apply in full. The table lists each state with the caveats that matter to equity holders.

No-wage-tax states, 2026
State	Wage income tax	What equity holders should still know
Alaska	None	No individual income tax of any kind.
Florida	None	No individual income tax; constitutional prohibition.
Nevada	None	No individual income tax.
New Hampshire	None	The 3% interest & dividends tax was repealed effective Jan 1, 2025 — investment income is now also untaxed.
South Dakota	None	No individual income tax.
Tennessee	None	The Hall tax on interest and dividends was fully repealed in 2021.
Texas	None	No individual income tax; constitutional prohibition (2019 amendment).
Washington	None	Long-term capital gains excise applies when shares are sold: 7% above the standard deduction, 9.9% on gains over $1M. Details below.
Wyoming	None	No individual income tax.

Verified as of July 13, 2026. Sources: Tax Foundation, 2026 state individual income tax rates; Washington DOR capital gains tax; New Hampshire DRA on the repealed I&D tax.

The Washington exception

Washington is the one state on this list where equity compensation can still generate a state-level bill — just not at vest. The state's capital gains excise applies to long-term gains realized on sales of stock and similar assets. RSU vesting itself is wage income and untaxed; what matters is the spread between your vest-date basis and the eventual sale price, if you hold the shares for more than a year after vesting.

Washington long-term capital gains excise, current structure
Tier	Rate (%)	Applies to
Standard deduction	0	First $278,000 of annual long-term gains (2025 figure, indexed annually; 2026 amount pending DOR publication)
Base tier	7	Long-term gains above the deduction, up to $1,000,000
Surcharge tier (2025+)	9.9	Long-term gains above $1,000,000 (7% base + 2.9% surcharge, SB 5813)

Verified as of July 13, 2026. Source: Washington Department of Revenue. Real estate and retirement-account sales are exempt; the tax is structured as an excise on the sale, not an income tax.

Moving states does not move vested history

A common misconception is that relocating to one of these nine states before a vest makes the income state-tax-free. Most states with an income tax source equity compensation to where the work was performed between grant and vest, and they prorate accordingly — California, for example, taxes the workday-weighted share of an RSU vest earned while you worked there even if you vest as a Texas resident. The move helps at the margin (future grants, and the portion of time worked in the new state) rather than erasing the old state's claim. Withholding also may not happen automatically for a former state, which can create exactly the kind of gap the safe-harbor rules penalize.

Also worth keeping in perspective: the state layer is usually the smaller one. Federal supplemental withholding, Social Security, and Medicare take roughly 30% of a typical vest regardless of state — compare the full picture in the 50-state supplemental rate table.

Residency and income-sourcing rules are fact-specific and aggressively enforced by high-tax states. This page is general reference information, not tax or relocation advice.

Common questions

Which states have no income tax in 2026?: Nine: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. None of them withholds state tax from wages, bonuses, or RSU vests.
Are RSUs completely tax-free in Texas or Washington?: No — federal tax applies in full everywhere: 22% or 37% supplemental withholding, Social Security, and Medicare. What disappears is only the state layer on wages. In Washington, selling shares later can additionally trigger the state's 7%-9.9% capital gains excise.
Does Washington tax RSU vesting or only the sale?: Only the sale. Vesting is wage income, which Washington does not tax. Long-term gains realized when you sell — above the standard deduction ($278,000 for 2025, indexed) — are subject to the 7% excise, plus 2.9% on gains over $1 million.
If I move to a no-tax state before my RSUs vest, does my old state still tax them?: Often partially, yes. Most states source equity income earned while you worked there, typically by prorating workdays between grant and vest. Moving before a vest reduces but rarely eliminates the old state's claim.