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TN · payroll profile

Tennessee

Everything an out-of-state employer needs before running a Tennessee payroll: what to withhold, which form the employee signs, whether reciprocity applies, and who to register with.

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Personal income tax
None on wages
Reciprocal agreements
None
SUI wage base 2026
$7,000
Local income taxes
No

Income tax withholding

Imposes wage income tax No
Rate structure n/a
Withholding certificate none
Accepts federal Form W-4 No
Convenience-of-the-employer rule No
Nonresident withholding threshold From the first dollar
No personal income tax withholding. Employers must register for Tennessee unemployment insurance.
Local income taxes No
No state or local personal income tax. Tennessee's Hall Income Tax on interest and dividends was fully repealed effective January 1, 2021.

Reciprocity

States that exempt Tennessee residents

A Tennessee resident working in these states files that state's certificate and is taxed only by Tennessee.

District of Columbia

Unemployment insurance and paid leave

Taxable wage base 2026 $7,000
2025 base was $7,000.
New employer rate 2.7%
Experience rate range 0.01% – 10%
Experience-rating method reserve ratio
Employee UI contribution No
Paid family / medical leave No

Employer registration

Tax agency
Tennessee Department of Revenue
UI agency
Tennessee Department of Labor and Workforce Development

Sources

tn.gov · tn.gov · taxfoundation.org · oui.doleta.gov · oui.doleta.gov · oui.doleta.gov

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This is a determination aid, not advice. StateSide encodes published state rules and applies them mechanically to the facts you enter. It does not know your entity structure, your nexus history, your equity compensation, or the dozens of exceptions that turn a clean rule into a judgement call. Every determination cites the state source it came from — verify against that source, and take anything consequential to a payroll tax professional before you act on it.