Tennessee

Sales Tax

  • Statewide: 7.0%
  • Counties can levy an additional sales tax no more than 2.75%.
  • Current average sales tax (with local taxes included): 9.546%
  • Common Exceptions at State Level:
    • Prescription Medicine: Exempt
    • Unprepared Food: 4%
    • Motor Vehicles for Qualified Military Service members: Exempt
  • Gasoline Tax: 45.80 cents/gallon (Includes all state, local, and federal taxes)
  • Diesel Fuel Tax: 52.80 cents/gallon (Includes all state, local, and federal taxes)
  • Cigarette Tax: 62 cents/pack of 20
  • Single item purchases have a maximum amount (usually $1,600) that can be subject to local taxes. Some medical supplies and services are exempt.

 

Personal Income Tax

  • Beginning in 2021, Tennessee has no personal income tax.  

 

Property Tax

  • Local municipalities average 0.71% of the property's assessed value. Calculation of assessed value: 25% of fair market value, reappraised annually.
  • Relief programs for:
    • 65 and over and/or Disabled: Property tax reduction on maximum taxable value of $29,000 and income less than $30,700.
    • Disabled Veteran/Surviving Spouse: Property tax reduction on maximum taxable value of $175,000.
    • 65 and over: Property tax freeze available subject to income limitations.
    • Personal Property Tax: Yes. Rates and exemptions vary.

 

Inheritance & Estate Taxes: None

Department of Revenue website: https://www.tn.gov/revenue/

More Financial Guidance From MOAA 

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