I Asked ChatGPT To Find the Best Places To Retire With Zero State Income Tax
Written by
Laura Beck
Edited by
Brendan McGinley
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Retiring to a state with no income tax can save thousands of dollars annually on your Social Security, pension and retirement account withdrawals. I asked ChatGPT to pick the best places to live where you won’t pay state income tax on your retirement income.
What the AI wrote was actually a fairly comprehensive breakdown of all nine states with zero state income tax. Even better, it narrowed the list down to three top picks based on overall retirement friendliness:
The Complete List of Zero-Income Tax States
ChatGPT identified nine states that don’t tax ordinary wage income or retirement account withdrawals at the state level:
Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, Wyoming and New Hampshire round out the list. The AI also shared that New Hampshire is in a special category; it has no broad income tax but has historically taxed interest and dividends, though those taxes are being phased out in 2027.
This means your Social Security benefits, pension payments and 401(k) withdrawals won’t get hit with state income taxes in any of these locations.
ChatGPT’s Top 3 Picks
Rather than just listing all nine states, the AI picked three that best balance tax benefits with lifestyle factors that matter to retirees.
Wyoming topped ChatGPT’s list for its complete tax friendliness. The AI said that Wyoming has no state income tax, very low property taxes and modest sales taxes. The state also has no estate or inheritance tax.
ChatGPT praised Wyoming’s “low population density, natural beauty, lots of open space, peace and quiet” while adding that it’s “good for outdoors types.” The AI acknowledged the trade-offs: Healthcare access can be limited in rural areas, winters are harsh and some services and cultural options tend to be less available than in major metro areas.
Florida came second on ChatGPT’s list, combining tax benefits with retiree-friendly infrastructure. The AI noted that Florida has no state income tax covering Social Security, pensions and IRAs.
ChatGPT liked Florida for its warm weather, many retiree-oriented communities, homestead property tax exemptions and no estate or inheritance tax. However, ChatGPT warned about hurricane risk, expensive home insurance, high cost of living in desirable areas and intense summer heat and humidity.
Nevada rounded out the top three with its combination of tax benefits and amenities. ChatGPT noted Nevada has no state income tax on retirement income, relatively affordable property taxes and no estate or inheritance tax in many places.
The AI praised Nevada’s mild winters, large cities with amenities like Las Vegas and Reno, plus access to outdoor recreation. ChatGPT warned about high sales and local taxes, weaker healthcare access in remote parts, rising housing costs and severe summer heat in southern Nevada.
The Strong Runners-Up
ChatGPT also highlighted four other states worth considering, depending on your priorities.
Texas made the list for having no income tax and lots of climate and lifestyle variation across the large state. But the AI warned that property taxes are among the highest in the U.S.
South Dakota won mention for its low overall cost of living and no income tax: particularly good for people who prefer rural or less densely populated settings.
Alaska appeared as an option for people who love spectacular scenery and don’t mind cold weather. The AI noted Alaska has no income tax or state sales tax, plus residents get an annual dividend from the state. But it’s cold, remote and has longer, darker winters.
Tennessee made the runner-up list after recently eliminating taxes on interest and dividends while maintaining no income tax. ChatGPT wrote about the warm climate and good options available.
What To Watch Out For
ChatGPT had some warnings about hidden costs that could offset your state income tax savings.
The AI warned to check property taxes carefully since some zero-income-tax states make up for lost revenue there. Sales tax rates, including whether essentials like groceries and medicine get taxed, also matter.
ChatGPT wrote that cost of living (including housing, utilities and transportation) can be much higher in some “tax-free” states. Healthcare access, climate preferences and inheritance taxes are other things you should take into consideration when choosing a retirement locale.
The Trade-Off Reality
ChatGPT’s analysis showed that no state is perfect for everyone. Each of the top picks involves trade-offs between tax savings, climate, cost of living and access to services. You’ll have to decide which features matter most to you, and which you can live without.
Wyoming offers the best overall tax situation but lacks some amenities and has harsh winters. Florida provides great retiree infrastructure and weather but comes with hurricane risks and potentially high living costs. Nevada balances amenities and taxes but faces water issues and extreme summer heat.
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