Nine states have no property tax on real estate
Alaska, Delaware, Hawaii, Idaho, Louisiana, Mississippi, Nevada, South Dakota, and Tennessee do not charge property tax on real estate. This means you own land or a house outright without paying annual property taxes to the state or county based on the property's value.
However, "no property tax" does not mean no housing costs. Most of these states make up the revenue through other taxes — sales tax, income tax, or both. Some charge property taxes on vehicles, business equipment, or mineral rights instead. The total tax burden on homeowners varies widely depending on what else you earn and buy. If you are considering moving to one of these states specifically to avoid property tax, compare the full tax picture: state income tax rate, sales tax rate, and any local fees or assessments that might apply to your property.
Key Takeaways
- Nine states impose no annual property tax on residential real estate: Alaska, Delaware, Hawaii, Idaho, Louisiana, Mississippi, Nevada, South Dakota, and Tennessee.
- States without property tax typically collect revenue through income tax, sales tax, or both, so your total tax burden depends on your income and spending.
- Some no-property-tax states still charge taxes on vehicles, business property, or mineral rights, so check local rules before buying.
- Property tax elimination does not affect your mortgage, homeowners insurance, or HOA fees — only the annual tax bill to the county or state.
How each no-property-tax state funds government services
Alaska has no state income tax and no property tax. It funds schools, roads, and services through oil revenue and a small sales tax in some municipalities. If you buy property in Alaska, you pay no annual property tax to the state, though some boroughs (counties) may charge local assessments for specific services.
Delaware has no sales tax but charges income tax on wages and business income. Property owners pay no property tax on real estate. This combination makes Delaware attractive to retirees on fixed incomes and businesses, though wage earners pay state income tax.
Hawaii has no property tax on real estate but charges both state income tax and a 4% sales tax. The state also taxes business gross receipts. Property owners benefit from no property tax, but residents pay tax on most purchases and income.
Idaho, Louisiana, Mississippi, Nevada, South Dakota, and Tennessee each use different revenue sources. Idaho and Louisiana charge income tax but no property tax. Mississippi and Tennessee charge income tax on some forms of income but not wages. Nevada and South Dakota have no income tax and no property tax, relying instead on sales tax and other fees. Check the specific state's tax code for your situation, because rules vary by income type and residency status.
What you still pay even in no-property-tax states
Owning a home in a no-property-tax state does not eliminate all housing-related costs. You still owe mortgage payments (if you financed the purchase), homeowners insurance, property maintenance, and utilities. HOA fees and local assessments for roads, water, or emergency services may also apply, depending on where the property sits.
Some no-property-tax states charge annual vehicle registration or personal property taxes on cars, boats, or business equipment. A few assess taxes on mineral rights or timber harvesting. Read the specific state and county rules for your property type before assuming you have eliminated all tax obligations. Property tax elimination also does not affect your federal income tax. If you have rental income from the property or capital gains when you sell, you owe federal tax on that income regardless of state property tax status.
Comparison of no-property-tax states by total tax burden
| State | Property Tax | State Income Tax | Sales Tax | Best For |
|---|---|---|---|---|
| Alaska | None | None | 0–7.5% (local) | Retirees, high earners |
| Delaware | None | Yes (2.2–6.6%) | None | Wage earners, businesses |
| Hawaii | None | Yes (1.4–11%) | 4% | Retirees with pensions |
| Idaho | None | Yes (1–5.8%) | 6% | Moderate earners |
| Louisiana | None | Yes (2–6%) | 4.45% | Moderate earners |
| Mississippi | None | Partial (5%) | 7% | Retirees, low earners |
| Nevada | None | None | 6.85% | High earners, retirees |
| South Dakota | None | None | 4.5% | High earners, retirees |
| Tennessee | None | Partial (1%) | 9.55% | Retirees, low earners |
The table shows state-level rates only. Local and county taxes, assessments, and fees vary within each state and can add significantly to your total bill. Always check the specific county or municipality where you plan to buy.
Your actual tax burden depends on your income level, what you spend, and where in the state you own property. A high earner in Nevada pays no income tax and no property tax but does pay sales tax on purchases. A retiree in Mississippi may pay minimal income tax on pension income and no property tax. Use the table as a starting point, then research the specific state and county for your situation.
How to research property taxes in a specific no-property-tax state
Start with the state's department of revenue website. Each state publishes its tax code and rates. Search for "property tax" or "real estate tax" on that site to confirm the current rules — tax law changes, and what applied last year may not apply this year.
Next, contact the county assessor's office in the county where you plan to buy. The assessor can tell you whether any local assessments, bonds, or special district taxes apply to that property. Some counties in no-property-tax states still charge fees for fire districts, water systems, or road maintenance. If you are buying a home with a mortgage, your lender will order a title search and property appraisal. The appraisal report often includes local tax information. Ask your real estate agent or title company to clarify any local fees before closing.
Frequently Asked Questions
Do I still pay property tax if I move to Alaska or Nevada?
No. Alaska and Nevada have no state property tax on real estate. However, some Alaska boroughs and Nevada counties charge local assessments for specific services. Check with the county assessor in the exact area where you plan to buy to learn about any local fees.
Can I deduct property taxes on my federal return if my state has no property tax?
You can deduct state and local taxes (SALT) on your federal return only if you actually paid them. If your state has no property tax, you cannot deduct a property tax that does not exist. You may deduct other state taxes you paid, such as income or sales tax, up to the $10,000 annual limit.
Which no-property-tax state has the lowest overall tax burden?
It depends on your income and spending. Alaska and Nevada have no income tax and no property tax, making them attractive to high earners. South Dakota is similar. For retirees on fixed incomes, Mississippi and Tennessee tax only certain income types, which may result in lower bills. Compare your specific situation against each state's income, sales, and local tax rates.
Do HOA fees replace property taxes in no-property-tax states?
No. HOA fees are separate from property tax and exist in both property-tax and no-property-tax states. HOA fees pay for community amenities and maintenance, not government services. You may live in a no-property-tax state without an HOA, or in an HOA community in a state that does charge property tax.
If I own rental property in a no-property-tax state, do I owe property tax on it?
No. Rental property is still real estate, so it is exempt from property tax in states that have no property tax on real estate. However, you owe federal income tax on the rental income you receive, and you may owe state income tax depending on the state's rules on business or rental income.