Updated October 5, 2026. Quick answer: No. Tennessee’s only individual income tax was the Hall income tax, which “is imposed only on individuals” receiving interest from bonds and notes and dividends from stock, and the Department of Revenue says it was “repealed for tax periods that begin on January 1, 2021”. Annuity payments add no Tennessee income tax.
How Tennessee treats annuity income
| Item | What the documents say |
|---|---|
| Treatment | Not taxed by the state |
| Hall income tax | Repealed for tax periods beginning on or after January 1, 2021 |
| Annuities | The Department’s page does not name annuities; the repealed tax reached only interest and dividends |
A $24,000 example
A stream of $24,000 in annuity payments adds $0 of Tennessee income tax. Federal tax on the payments still applies.
What changes in 2026
The Hall tax repeal took effect for tax periods beginning on January 1, 2021, so no 2026 change is pending.
Federal rules
The state’s treatment sits on top of the federal one. The IRS explains the federal side in Topic no. 410, Pensions and Annuities and Publication 575, Pension and Annuity Income.
Related: whether Tennessee taxes pensions, how Tennessee taxes retirement income, annuity income tax by state, how a surrendered annuity is taxed, and pension and annuity decisions.
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Answer againSources
- Hall Income Tax (Tennessee Department of Revenue): https://www.tn.gov/revenue/taxes/hall-income-tax.html
Sources: the primary documents linked above, read on October 5, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.