Tennessee tax tidbit: no wage tax

You might have seen Tennessee in the list of states that don't collect an income tax.

That's correct … to a point.

The Volunteer State doesn't tax wage income, but it certainly wants its residents to hand over 6 percent of the interest they earn from bonds and notes and from dividends from stock.

This tax has been around since 1929. It originally was called the Hall income tax for the
senator who sponsored the legislation. 

The state does, however, offer a break for its senior citizens.

If you're older than 65 with total income less than $16,200 as a single taxpayer or are a married couple filing jointly with less than $27,000 income, then you're exempt from the tax.

The rest of you Tennessee taxpayers with taxable unearned income, get your returns into the state by April 15.

Tax trip around the United
States: This post is part of our series highlighting tax
information from the 50 U.S. states and Washington, D.C. You can read other state tax blurbs at our Complete menu of tasty state tax tidbits.

The State Tax Departments page provides links to
official state
and District of Columbia revenue Web sites so that you can find out more
about
your home's tax laws and filing requirements.

As
we work
through the 2010 tax season, a different state will be featured each day
as
noted in Don't forget your state taxes! Check back to see
what tax
tidbit we share about your home.

Related posts:

• State Tax Tidbits
• State Tax Departments
• Don't forget your state taxes!
• 9 states of no-tax note … sort of

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