Compare taxes and see how much you save moving from Tennessee to Virginia
Tennessee eliminated all income taxes in 2021 when the Hall Tax on investment income was fully repealed, making it a pure 0% income tax state. Virginia taxes most income at an effective rate of 5.75% (the top bracket kicks in above just $17,000). A $100,000 earner saves $5,501 per year in Tennessee. The key trade-off: Tennessee compensates with a higher sales tax (up to 9.75% and a 4% tax on groceries), while Virginia has lower sales tax (4.3-6%) and no tax on groceries. Neither state has an estate or inheritance tax.
No Income Tax
Hall Tax on dividends/interest fully repealed 2021; no wage or salary income tax
Progressive (5.75% over $17K)
Effectively 5.75% on most income above $17,000; no local income tax surcharge
At $100,000 income:
That is $458/month back in your pocket!
| Income | TN Tax | VA Tax | Savings | 10-Year |
|---|---|---|---|---|
| $50,000 | $0 | $2,663 | $2,663 | $26,630 |
| $75,000 | $0 | $4,076 | $4,076 | $40,760 |
| $100,000 | $0 | $5,501 | $5,501 | $55,010 |
| $150,000 | $0 | $8,351 | $8,351 | $83,510 |
| $250,000 | $0 | $14,051 | $14,051 | $140,510 |
| $500,000 | $0 | $28,426 | $28,426 | $284,260 |
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Talk to a CPA About Your State Move →Yes. Tennessee fully repealed the Hall Tax on interest and dividends in January 2021. Tennessee now levies no income tax on wages, salaries, retirement income, Social Security, or investment income. It is one of nine states with no income tax as of 2026. The trade-off is a high combined sales tax (7% state + local = up to 9.75%) and a 4% tax on groceries.
Virginia’s tax brackets are: 2% on the first $3,000, 3% on $3,001-$5,000, 5% on $5,001-$17,000, and 5.75% on income above $17,000. Because the top bracket kicks in at just $17,001, virtually all income above that is taxed at 5.75%. A $100,000 earner effectively pays about 5.5% of gross income in Virginia state income tax, totalling roughly $5,501.
No. Virginia exempts most groceries from sales tax (0% on food for home consumption statewide). Tennessee, by contrast, charges a 4% state sales tax on groceries (reduced from the standard 7% but still meaningful). For a family spending $10,000/year on groceries, Tennessee’s grocery tax adds $400/year that Virginia residents do not pay.
Tennessee is generally better for retirees on a tax basis. Tennessee has 0% income tax on all retirement income including pensions, 401(k)/IRA withdrawals, Social Security, and dividends. Virginia taxes retirement income at up to 5.75%, though it offers some deductions for those 65+ (up to $12,000 deductible). A retiree with $80,000 annual income saves approximately $4,400/year in Tennessee vs Virginia. Neither state has an estate or inheritance tax.