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Tax Summary
- Tennessee does not collect state income tax on salaries and wages.
- There is a tax of 6% on income from stocks, bonds and notes.
- Personal exemption for a single individual is $1,250. Tax credit for a married couple is $2,500. Dependents earn a credit of $1,250 each.
- State sales tax in Tennessee is 7% for most items, plus whatever addition taxes are levied by counties and municipalities (generally between 1.5% and 2.75%).
- Food is taxed at a lower 6% rate, except candy, diet supplements and restaurant foods, which are at the higher 7%.
- Property taxes are based on a percentage of fair market value as follows:
- Residential property: 25%
- Farm property: 25%
- Commercial/Industrial: 40%
- Public Utility property: 55%
- Business personal property: 30%
- There is no homestead exemption in Tennessee, but there is property tax relief for the elderly, disabled, and veterans.
- Intangible taxes are collected on 40% of the value of stock of loan, investment or insurance companies.
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