You’ve probably heard the rumors or seen the billboards while driving into Las Vegas. People talk about the Silver State like it’s some kind of tax-haven utopia where the government just lets you keep every cent of your paycheck. But is that actually true? Honestly, it’s mostly true, but there are some "gotchas" that catch newcomers off guard.
The short answer: No, Nevada does not have a state income tax.
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Whether you are a professional poker player at the Bellagio, a remote software engineer in Reno, or a retiree enjoying the quiet of Henderson, the state government won't touch your wages. You don't have to file a state return. You don't have to worry about "tax brackets" at the state level. It’s one of only a handful of states—including Texas, Florida, and Wyoming—that operate this way.
But "no income tax" doesn't mean "no taxes." The money to pave the roads and run the schools has to come from somewhere.
How Nevada Stays Afloat Without Income Tax
If you’re moving from California, where the top marginal rate can hit double digits, Nevada looks like a dream. But the state is actually quite savvy about how it collects revenue. Instead of taxing your labor, it taxes your consumption and the industries that make the state famous.
Basically, Nevada relies heavily on:
- Gaming and Hospitality: The casinos pay a massive chunk of the state’s bills.
- Sales Tax: This is where you’ll feel it. The base state rate is 4.6%, but once you add local and county taxes, you’re looking at much higher numbers. In Clark County (Las Vegas), the combined rate is 8.375%. In Washoe County (Reno), it’s 8.265%.
- Excise Taxes: Nevada has "sin taxes" on alcohol and tobacco. If you’re a smoker or a heavy drinker, you’re indirectly funding the state’s lack of income tax.
The Business Side: Does Nevada Have State Income Tax for Companies?
This is where things get a bit more complex. Technically, there is no corporate income tax. If you run a standard C-Corp or an LLC, you aren't paying a percentage of your profits to the Department of Taxation.
However, big businesses do pay something called the Commerce Tax.
Established back in 2015, the Commerce Tax is a gross receipts tax. It only kicks in if your business earns more than $4 million in Nevada gross revenue during a fiscal year. If you’re a small mom-and-pop shop or a freelancer making $200k a year, you don't pay a dime of this. But if you’re a high-volume entity, you’ll pay a rate based on your industry—anywhere from 0.051% to 0.331%.
There’s also the Modified Business Tax (MBT). This is essentially a payroll tax. For most general businesses, you pay about 1.17% on total wages after deducting health insurance costs, but only on the portion of wages that exceed $50,000 in a quarter. It’s a way for the state to tax "business activity" without calling it an income tax.
What Most People Get Wrong About Moving to Nevada
I see this all the time: people think they can just rent a P.O. Box in Vegas, keep their job in San Francisco, and magically stop paying California taxes.
It doesn't work like that.
To truly benefit from Nevada’s lack of state income tax, you have to establish "domicile." This means Nevada must be your true, permanent home. If you spend 200 days a year working in a state with high taxes, that state is probably going to come knocking for their share, regardless of where your driver's license says you live.
Taxing authorities in states like New York or California are notoriously aggressive. They look at where you vote, where your kids go to school, and even where you keep your "near and dear" items (like family photos or your dog). You can’t just "check out" of taxes by having a Nevada address if your life is still centered elsewhere.
Property Taxes: The Hidden Perk
One thing people often overlook is that Nevada’s property taxes are actually quite reasonable. While the "no income tax" gets all the headlines, the property tax situation is a quiet win for homeowners.
The effective property tax rate in Nevada is roughly 0.48%, which is well below the national average. Plus, the state has an abatement law that caps how much your tax bill can increase year-over-year—usually limited to a 3% increase for primary residences. This prevents the "gentrification tax jump" that happens in places like Texas, where a spike in home values can lead to a tax bill you suddenly can't afford.
Actionable Steps for New or Prospective Residents
If you are planning to move to take advantage of the tax climate, don't just wing it.
- Document Your Domicile: Get a Nevada driver’s license, register your car (it’s expensive here, be warned!), and register to vote immediately.
- Watch the "Source" Income: If you live in Nevada but own a rental property in another state, or you’re a partner in a business located in a different state, you will likely still owe taxes to that state on that specific income. Nevada can’t protect you from other states' laws.
- Calculate the Sales Tax Trade-off: If you’re a high spender who buys a lot of "stuff" (cars, luxury goods, expensive meals), do the math. The 8.375% sales tax in Vegas might eat up a chunk of what you’re saving on income tax.
- Business Owners: If your revenue is approaching that $4 million mark, start tracking your "gross receipts" specifically from Nevada sources. The Commerce Tax filing is required even if you owe $0, provided you hit certain thresholds.
The "Nevada tax advantage" is very real, but it’s a structural trade-off. You trade a slice of your paycheck for higher costs at the cash register. For most high-earners and retirees, it’s a winning deal. Just don't expect the government to be completely invisible when you go to buy a new truck or a bottle of bourbon.
Next Steps:
If you're moving for business, check the Nevada Secretary of State’s SilverFlume portal to handle your business license and initial filings. For individuals, your first "tax task" isn't a state return—it's ensuring your federal withholdings are adjusted since you no longer have a state tax "cushion" being taken out of your check.