Tax in Nevada: a complete guide
What state taxes do you have to pay in Nevada? Nevada has no state income tax – but that’s not the whole story. Here’s everything you need to know about taxes in the state.
For the Nevadans who call the state their home, they can make the most of a comparatively relaxed approach to taxes. Nevada imposes zero state income tax – including on retirement income or windfalls from a lucky night at a casino – which might attract people to the state.
However, sales taxes are considerably higher than in other states. Those visiting hotspots like Vegas will pay a premium in extra excise duties if they enjoy cocktails, beers, or wines during their stay.
At a glance, Nevada’s state taxes offer:
Zero income tax
A 6.85 percent sales tax
No retirement taxes
Nevada income tax
Nevada has a reputation as one of the most tax-friendly states. There is no state income tax in Nevada.
Whether you work for a municipal agency or if you win big at one of the state’s many casinos, you won’t pay a penny in income tax. This also counts for retirement income.
Nevada residents will still need to pay federal income tax, of course. Nevada’s zero percent income tax couldn’t be more different from its neighbor to the west. Californians pay a tax rate of up to 12.3 percent – the highest in the country. When it comes to state revenue, sales taxes are a large part of that equation.
Nevada sales tax
In contrast to the state income tax of zero, Nevada is home to some of the highest sales taxes in the country. Nevada imposes a statewide sales tax of 6.85 percent, the seventh-highest state sales tax in the US.
In addition to the statewide sales tax, counties and cities impose their own sales taxes too. With local sales taxes in addition to the state sales tax, the total amount of sales tax can rise to nearly nine percent.
As with many other states, there are exemptions to state sales tax. Food is exempt from sales tax unless it is being served to eat right away, for example, at a restaurant. Newspapers and prescription drugs are also exempt from sales tax, as well as prosthetics and other medical equipment items.
Like many other states, Nevada also puts excise taxes on alcohol and cigarettes.
|Nevada wine tax||$0.70 per gallon||Wine vendors are responsible for paying a state excise tax of $0.70 per gallon, plus Federal excise taxes, for all wine sold in Nevada.|
|Nevada beer tax||$0.16 per gallon||Beer vendors are responsible for paying a state excise tax of $0.16 per gallon, plus Federal excise taxes, for all beer sold in Nevada.|
|Nevada liquor tax||$3.60 per gallon||Liquor vendors are responsible for paying a state excise tax of $3.60 per gallon, plus Federal excise taxes, for all liquor sold in Nevada.|
|Nevada cigarette tax||$1.80 per pack of 20 cigarettes||That works out to nine cents per cigarette.|
Nevada property tax
Property tax rates vary across Nevada’s 17 counties, and the amount of property tax paid depends on a property’s value. On average, Nevada’s property tax rate is 0.48 percent.
Nevada estate tax
There is no estate tax and no tax on inheritance in Nevada.
Nevada motor tax
Whether you’re just driving through Nevada on your road trip or if you’re a resident of the state, you’ll have to pay Nevada’s gas taxes. Regular gasoline is taxed at $0.23 per gallon, and the tax on diesel is even higher, at $0.27 per gallon.
If you’re purchasing a car in Nevada, a 4.6 percent sales tax rate is applied to all car dealerships in the silver state.
Nevada retirement tax
It’s easy to see why retirees are attracted to Nevada, considering it has no income tax. Retirement income is also tax-free.
At a state level, retirees will not be taxed on Social Security or any payments from retirement savings accounts such as 401(k)s. In addition to some medical equipment being exempt from the state sales tax, Nevada can be a very attractive place to retire from a tax perspective.
The bottom line
Remember that a state’s approach to taxation will affect households differently. To truly assess how your household would fare in another state, you must consider every aspect of your finances and lifestyle.
A financial advisor might be able to help you make that assessment if you’re thinking about a move across state lines. Or if you’re looking for a better understanding of your taxes and recommendations on making smarter choices.
A financial advisor can help you handle all your tax queries and ensure you’re not paying more tax than needed. Find your financial advisor with Unbiased.
Senior Content Writer
Rachel is a Senior Content Writer at Unbiased. She has nearly a decade of experience writing and producing content across a range of different sectors.