Tennessee Tax

Tennessee State Tax

Tennessee Income Tax

Tennessee state tax revenues come from three main sources: income tax, sales tax, and property tax. The Tennessee Department of Revenue regulates various tax laws and procedures in the state, including the settlement of tax rates, filing of state tax returns, and collection of sales tax and state income tax.

Tennessee Income Tax

Wages are not subject to Tennessee income tax. Instead, taxpayers must report profits from investments, stocks, and bonds in their annual income tax returns. The state collects a flat rate of 6% for incomes of all levels.

The Tennessee state tax code requires full-time and part-time residents to file their tax returns for earnings made during their stay in the state. Non-residents are also required to file their tax return for incomes earned from a source based in Tennessee. Corporations are subject to 6.5% corporate income tax.

Tennessee Sales Tax

Sale of most tangible items is subject to 7% state sales tax in Tennessee. However, counties and cities may require up to 2.75% additional local sales tax. There are also special taxing districts that levy special taxes to fund special projects. Total sales tax to be paid in the state may vary from 7% to a maximum of 9.75% depending on the location and type of products sold.

Tennessee Property Tax

The Tennessee tax law requires all individuals and companies to pay property tax for all taxable properties including houses, land, vehicles, and other assets. The value of a property and the corresponding property tax are assessed by the county where it is located.