Memphis, TN Taxes 2025
Complete local tax guide and OBBBA calculator
On This Page
Memphis Tax Overview 2025
No state income tax. Very affordable housing market.
Local Income Tax
0%
City/county rate
Sales Tax
9.25%
State + local
Property Tax
1.42%
Effective rate
Median Home
$145,000
Home value
No Local Income Tax!
Memphis does not impose a local income tax on residents, which means you only pay state income tax (if applicable) and federal taxes.
State Tax Information
Memphis is located in Tennessee (0% state income tax)
💼 Memphis Local Income Tax
Memphis does not impose a local income tax on residents. Your income tax obligations are limited to state income tax (if applicable in Tennessee) and federal income tax.
This is good news for Memphis residents, as it means one less tax to worry about compared to cities that do impose local income taxes.
Total Income Tax Burden in Memphis
🛒 Memphis Sales Tax 2025
The combined sales tax rate in Memphis is 9.25%. This includes both the Tennessee sales tax and any local sales taxes.
Sales tax applies to most retail purchases in Memphis. Some items like groceries, prescription medications, and clothing may be exempt or taxed at reduced rates depending on Tennessee law.
Sales Tax Breakdown
Sales Tax Examples
| Purchase Amount | Sales Tax | Total |
|---|---|---|
| $50 | $4.63 | $54.63 |
| $100 | $9.25 | $109.25 |
| $500 | $46.25 | $546.25 |
| $1,000 | $92.50 | $1,092.50 |
🏠 Memphis Property Tax 2025
The average effective property tax rate in Memphis is 1.42%. Based on the median home value of $145,000, the typical homeowner pays approximately $2,059 per year in property taxes.
Property taxes fund local services including schools, police, fire departments, roads, and parks. Rates vary by specific location within Memphis based on school district and other taxing authorities.
Estimated Annual Property Tax in Memphis
| Home Value | Annual Tax | Monthly | SALT Deductible? |
|---|---|---|---|
| $200,000 | $2,840 | $237 | ✓ Yes |
| $300,000 | $4,260 | $355 | ✓ Yes |
| $400,000 | $5,680 | $473 | ✓ Yes |
| $500,000 | $7,100 | $592 | ✓ Yes |
| $750,000 | $10,650 | $888 | ✓ Yes |
| $1,000,000 | $14,200 | $1,183 | ✓ Yes |
💡 SALT Tip: Under the OBBBA, you can deduct up to $40,000 in state and local taxes (SALT) on your federal return. This includes property taxes, state income taxes, and local income taxes.
💰 Memphis Cost of Living
Housing Costs
Tax Summary
OBBBA Tax Benefits for Memphis Residents
Double benefit: no state tax plus OBBBA federal deductions.
The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduced several federal tax deductions that can significantly reduce your tax burden as a Memphis resident.
Available OBBBA Deductions:
Calculate Your Memphis Tax Savings
Use our free OBBBA calculator to see exactly how much you could save on your 2025 federal taxes as a Memphis resident.
Calculate My SavingsFrequently Asked Questions
What is the sales tax in Memphis?
The combined sales tax rate in Memphis is 9.25%. This includes both state and local sales taxes.
Does Memphis have a local income tax?
Memphis has a local income tax of 0%. This is in addition to any state and federal income taxes.
What is the property tax rate in Memphis?
The average effective property tax rate in Memphis is 1.42%. On a home worth $145,000, you'd pay approximately $2,059 per year.
How do OBBBA deductions benefit Memphis residents?
Double benefit: no state tax plus OBBBA federal deductions. You can use our free calculator to estimate your total savings from tips, overtime, auto loan interest, SALT, and senior bonus deductions.