By Katelyn Washington, Kiplinger –
If you are considering moving to a different state, it’s a good idea to investigate how each state handles taxes on retirement income before you decide. Even within states, taxes can differ for each type of retirement income. This list provides an overview of how income from employment, investments, a pension, retirement distributions, and Social Security is taxed in every state.
Alabama taxes on retirees
A new law for 2023 makes the first $6,000 or distributions from retirement plans (like IRAs and 401(k)s tax-exempt for retirees age 65 and older in Alabama.
Income Tax on Taxable Income: Low of 2% (on up to $500 for single filers and $1,000 for joint filers) and a high of 5% (on more than $3,000 for single filers and $6,000 for joint filers)
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Partially taxable
Alaska retirement taxes
Alaska doesn’t have a personal income tax, meaning that none of your retirement income is taxable on the state level.
Income Tax on Taxable Income: N/A
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: Alaska State Tax Guide
Does Arizona tax your retirement income?
Arizona taxes most types of retirement income, but a new flat income tax rate for 2023 might help lower your tax bill.
Income Tax on Taxable Income: 2.5% flat rate
- Social Security: Not taxable
- 401(k) and IRA Distributions: Taxable
- Pensions: Taxable (some types of pensions qualify for an exemption of up to $2,500)
More: New Arizona Families Tax Rebates Up to $750 Coming Soon
Does Arkansas tax Social Security?
Arkansas is another state that taxes most types of retirement income, but taxpayers 59.5 or older can deduct up to $6,000 of eligible retirement income from their taxable income.
Income Tax on Taxable Income: Low of 0% (on up to $5,099) and a high of 4.7% (on more than $24,300)
Note: The tax rates above only apply to taxpayers with net incomes up to $84,500. Taxpayers with higher net incomes may reach higher tax brackets sooner.
- Social Security: Not taxable
- 401(k) and IRA distributions: Taxable
- Pensions: Taxable (military pensions are tax-exempt)
More: Arkansas State Tax Guide
How retirement income is taxed in California
Most types of retirement income are taxable in California. Some retirees might pay an income tax rate as high as 13.3% (if their taxable income reaches $1,000,000), but most retirees will pay a lower rate.
Income Tax on Taxable Income: California has nine income tax brackets (excluding the 13.3% bracket), which is more than in most states. Rates range from 1% to 12.3%.
- Social Security: Not taxable
- 401(k) and IRA Distributions: Taxable
- Pensions: Taxable
More: 10 Cheapest Places To Live in California
Is Colorado a good tax state for retirees?
Although Colorado taxes Social Security benefits, some retirees can exclude all their Social Security benefits from their taxable income. Colorado also allows a retirement income deduction of up to $20,000 for taxpayers 55 and older. Retirees 65 and older may deduct up to $24,000.
Income Tax on Taxable Income: Flat rate of 4.4%
- Social Security: Partially taxable for some retirees (fully deductible for taxpayers 65 and older)
- Pensions: Partially taxable
- 401(k) and IRA Distributions: Taxable
More: Colorado EV Tax Credit Rises to $5,000
How retirement income is taxed in Connecticut
Social Security is not taxed in Connecticut for single taxpayers with an AGI below $75,000 ($100,000 for joint filers). However, a recent Connecticut tax relief bill will phase out the income requirements, making Connecticut income tax more affordable for all Social Security recipients. Pension income and IRA distributions may also be exempt (or partially exempt) for taxpayers meeting income requirements.
Income Tax on Taxable Income: Low of 3% (on up to $10,000 for single filers and $20,000 for joint filers) and a high of 6.99% (on more than $500,000 for single filers and $1,000,000 for joint filers).
- Social Security: Partially taxable
- Pensions: Partially taxable
- 401(k) and IRA Distributions: Partially taxable
More: Who Benefits from the Connecticut Tax Relief Bill?
Delaware taxes on retirees
Delaware taxes most types of retirement income, but the good news is that Delaware offers a pension exclusion that allows taxpayers 60 and older to deduct up to $12,500 of qualified retirement plans (including 401(k)s from their taxable income.
Income Tax on Taxable Income: Low of 0% (on up to $2,000) and a high of 6.6% (on more than $60,000)
- Social Security: Not taxable
- Pensions: Partially taxable
- 401(k) and IRA Distributions: Partially taxable
More: Most Expensive States for Retired Military Service Members
District of Columbia retirement taxes
Most of your retirement income is taxable in DC. However, residents can deduct up to $3,000 of retirement income when filing their taxes. Washington DC has an estate tax on estates worth more than $4,528,800, and your heirs could pay up to 16% in taxes to call the estate their own.
Income Tax on Taxable Income: Low of 4% (on less than $10,000) and a high of 10.75% (on more than $1,000,000)
- Social Security: Not taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
More: District of Columbia Tax Guide
There is no personal income tax in Florida. The state won’t tax your pension or any other type of retirement income. There are no estate or inheritance taxes either.
Income Tax on Taxable Income: N/A
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: 5 Reasons People Retire in Florida
Georgia taxes on retirees
Georgia taxes most retirement income, but the state offers a hefty retirement income exclusion. Taxpayers age 62 and older may exclude up to $35,000 of their retirement income, and those age 65 and older can exclude up to $65,000 of retirement income.
Income Tax on Taxable Income: High of 5.75% (on over $7,000 for single filers and $10,000 for joint filers)
(Note: The flat income tax rate will be 5.49% in 2024.)
- Social Security: Not taxable
- Pensions: Partially taxable
- 401(k) and IRA Distributions: Partially taxable
More: Georgia Gas Tax Suspension Extended by Gov. Kemp
What taxes do retirees pay in Hawaii?
Hawaii exempts some retirement income, but income tax rates are on the high end for retirement income that is taxable. Hawaii also has an estate tax. The estate tax exemption is $5.49 million in Hawaii, and estates that exceed the exemption are taxed between 10% and 20%.
Income Tax on Taxable Income: Low of 1.4% (on up to $4,800 for joint filers and $2,400 for single filers) and a high of 11%
- Social Security: Not taxable
- Pensions: Not taxable (as long as you don’t make contributions)
- 401(k) and IRA Distributions: Taxable
More: States That Won’t Tax Your Pension
Idaho taxes on retirees
Idaho taxes most types of retirement income and has a flat tax rate. However, there are no estate or inheritance taxes in Idaho.
Income Tax on Taxable Income: 5.8% flat tax rate
- Social Security: Not taxable
- Pensions: Partially taxable (Some military and government pensions might qualify for an exemption)
- 401(k) and IRA Distributions: Taxable
More: Idaho State Tax Guide
Is retirement income taxed in Illinois?
Illinois is a state that exempts all retirement income. But there is an estate tax in Illinois, which has a $4 million exemption. Estates exceeding that value are taxed between 0.8% and 16%.
Income Tax on Taxable Income: Flat 4.95%
- Social Security: Not taxable
- Pensions: Not taxable
- 401k and IRA Distributions: Not taxable
More: States That Don’t Tax Retirement Income
Does Indiana tax Your retirement income?
Indiana has a low flat tax rate for taxable income, and that’s a good thing since the state only exempts Social Security. However, there are no estate or inheritance taxes in Indiana.
Income Tax on Taxable Income: Flat 3.23%
- Social Security: Not taxable
- 401(k) and IRA Distributions: Taxable
- Pensions: Taxable
More: Indiana State Tax Guide
Iowa taxes on retirees
Iowa recently made retirement income tax-exempt for residents 55 and older. There is an inheritance tax in Iowa, but it will be eliminated in 2025.
Income Tax on Taxable Income: High of 6% for 2023 (on more than 75,000 for single filers and more than $150,000 for joint filers)
(Note: Iowa will move to a flat tax rate of 3.9% in 2026.)
- Social Security: Not taxable
- Pensions: Not taxable
- 401k and IRA Distributions: Not taxable
More: Iowa State Tax Guide
How does Kansas tax retirement income?
Kansas only exempts retirement income for some retirees depending on adjusted gross income (AGI), but some state lawmakers are trying to expand the exemption to include more residents.
Income Tax on Taxable Income: Low of 3.1% (on up to $30,000) and a high of 5.7% (on more than $60,000)
- Social Security: Partially taxable (Exempt for retires with an AGI of $75,000 or less)
- Pensions: Taxable (Public pensions are exempt)
- 401(k) and IRA Distributions: Taxable
More: Kansas State Tax Guide
Is retirement income taxable in Kentucky?
Kentucky taxes most types of retirement income. However, some types of retirement income qualify for an exclusion. For example, there is a $31,110 deduction available for state, private and military retirement plans.
Tax on Taxable Income: Flat 4.5% rate (4% in 2024)
- Social Security: Not taxable
- Pensions: Partially Taxable
- 401(k) and IRA Distributions: Taxable
More: Kentucky State Tax Guide
Louisiana taxes on retirees
Louisiana taxes some retirement income, but there is an income exclusion of up to $6,000 for retirees age 65 and older. There is no inheritance tax in Louisiana.
Income Tax on Taxable Income: Low of 1.85% (on up to $12.500 for single filers and $25,000 for joint filers) and a high of 4.25% (on more than $50,000 for single filers and $100,000 for joint filers)
- Social Security: Not Taxable
- Pensions: Taxable (Public and government pensions are exempt)
- 401(k) and IRA Distributions: Taxable
More: States With the Lowest Property Taxes
What taxes do retirees pay in Maine?
Maine taxes some forms of retirement income, but there is a pension exclusion of up to $30,000 ($35,000 in 2024). However, Maine has an estate tax. The estate exemption is $6.01 million for 2023, and heirs are taxed between 8% and 12%.
Income Tax on Taxable Income: Low of 5.8% (on up to $24,500 for single filers and $49,050 for joint filers) and a high of 7.15% (on more than $58,050 for single filers and $116,100 for joint filers)
- Social Security: Not taxable
- Pensions: Partially taxable (Federal pension income is exempt)
- 401(k) and IRA Distributions: Taxable
More: Tax Relief for Maine and Massachusetts Following Hurricane Lee
What retirement income is taxed in Maryland?
Maryland taxes some retirement income, and localities can tax your income. However, there is a pension exclusion of up to $34,300 for retirees age 65 and older. Maryland has both an estate and inheritance tax. The estate tax exemption is $5 million, and the inheritance tax ranges from 0.9% to 10%.
Income Tax on Taxable Income: Low of 2% (on up to $1,000) and a high of 5.75% (on more than $250,000 for single filers and $300,000 for joint filers)
- Social Security: Not taxable
- Pensions: Partially taxed (due to pension exclusion)
- 401(k) and IRA Distributions: Taxable
More: States With the Highest Gas Taxes
Massachusetts taxes on retirees
Massachusetts taxes most retirement income and imposes an estate tax .The estate tax exemption is $1 million. Most states only tax the portion of the estate that exceeds the exemption amount, but that’s not the case in Massachusetts. If an estate exceeds $1 million, the full value of the estate is taxed. Estate taxes can jump as high as 16% in Massachusetts.
Tax on Taxable Income: Flat rate of 5%
(Note: Income over $1 million is subject to an additional 4% tax.)
- Social Security: Not taxable
- Pensions: Taxable (Government and public pension plans may be tax-exempt)
- 401(k) and IRA Distribution: Taxable
More: Massachusetts Millionaire’s Tax Funds Free K-12 School Lunches
Michigan retirement tax friendliness
For tax year 2023, retirees born in 1945 or before can deduct up to $61,518 ($123,036 for joint filers) of eligible retirement income. Retirees born between 1946 and 1952 may exclude up to $15,379.50 ($30,759 for joint filers) of eligible retirement income in 2023. Michigan recently passed legislation that will allow retirees to claim the maximum pension deduction in 2026, regardless of age.
Tax on Taxable Income: Flat 4.05%
- Social Security: Not taxable
- Pensions: Partially taxable (Military pensions are tax-exempt)
- 401(k) and IRA Distributions: Partially taxable
More: Michigan State Tax Guide
Does Minnesota tax retirement income?
Minnesota taxes most retirement income. To make matters worse, the lowest income tax bracket is high in Minnesota when compared to other states. There is also an estate tax that applies to estates valued over $3 million. The bright side is Minnesota does not have an inheritance tax.
Tax on Taxable Income: Low of 5.3% (on up to $30,070 for single filers and $43,950 for joint filers) and a high of 9.85% (on more than $183,340 for single filers and $304,970 for joint filers)
- Social Security: Partially taxable
- Pensions: Taxable (Maryland allows a deduction for Military retirement pay)
- 401(k) and IRA Distributions: Taxable
More: Minnesota Rebate Checks and Child Tax Credit in 2023
Mississippi taxes on retirees
Retirement income is exempt in Mississippi, but other types of income (including early withdrawals from retirement accounts) are still taxable. However, the income tax rate on taxable income is low, and it is set to decrease in the coming years.
Tax on Taxable Income: Flat 5% tax rate for 2023
(Note: Mississippi’s income tax rate will gradually decrease until it reaches 4% in 2026.)
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: Mississippi State Tax Guide
Does Missouri tax your retirement income?
Missouri currently exempts Social Security benefits for single filers earning $85,000 or below and joint filers earning $100,000 or below. Recent legislation will eliminate the tax on all Social Security retirement benefits for the 2024 tax year.
Tax on Taxable Income: Low of 2% (on up to $2,414) and a high of 4.95% (on more than $8,449)
- Social Security: Partially taxable (not taxable in 2024)
- Pensions: Partially taxable (Public pensions will be exempt in 2024)
- 401(k) and IRA Distributions: Taxable
More: Missouri State Tax Guide
Montana taxes on retirees
Montana won’t tax your Social Security benefits if your adjusted gross income (AGI) is below the specified level ($25,000 for single filers and $32,000 for joint filers). Pensions may qualify for a partial exemption in 2023.
Tax on Taxable Income: Low of 1% (on up to $3,300) and a high of 6.75% (on more than $19,800)
(Note: The partial exemption on qualified retirement income is repealed for 2024. Retirees will be able to exclude up to $5,500 from their taxable income instead.)
- Social Security: Taxable (Deductible for some filers with lower incomes)
- Pensions: Taxable (Some pensions may qualify for a partial exemption)
- 401(k) and IRA Distributions: Taxable
More: Montana Property Tax Rebates and Other Relief for Homeowners
Does Nebraska tax retirement income?
Nebraska currently taxes Social Security benefits, but the state is doing away with that tax in 2025. However, retirees will still need to pay Nebraska income tax on other types of retirement income.
Tax on Taxable Income: Low of 2.46% (on up to $3,230 for single filers and $6,440 for joint filers) and a high of 6.84% (on more than $31,160 for single filers and $62,320 for joint filers)
- Social Security: Taxable (repealed in 2025)
- Pensions: Taxable: (Military retirement pay is exempt)
- 401(k) and IRA Distributions: Taxable
More: The Most Expensive States to Die In (Due to Death Taxes)
Is retirement income taxed in Nevada?
Nevada is one of the states with no income tax, so you don’t need to worry about having any of your retirement income taxed on the state level. There are no estate or inheritances taxes to worry about in Nevada either.
Tax on Taxable Income: N/A
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: 10 Most Tax-Friendly States for Retirees
New Hampshire taxes on retirees
There is no state income tax in New Hampshire, so your Social Security, benefits, pension, and retirement distributions are safe. However, New Hampshire currently taxes interest and dividend income at 4%. This tax will gradually decrease until it is eliminated in 2027.
Tax on Taxable Income: N/A (with the exception of interest and dividend income)
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: New Hampshire State Tax Guide
What taxes do retirees pay in New Jersey?
New Jersey taxes most types of retirement income, but most retirees age 62 and older can deduct a significant portion of their taxable income. As long as your federal AGI doesn’t exceed $150,000, you can deduct the maximum amount allowed based on your filing status. The maximum deductions are $75,000 for single filers, $50,000 for married filing separately, and $100,000 for joint filers.
Tax on Taxable Income: Low of 1.4% (on up to $20,000) and a high of 10.75% (on more than $1 million)
- Social Security: Not taxable
- Pensions: Partially taxable (Income requirements apply)
- 401(k) and IRA Distributions: Partially taxable (Income requirements apply)
More: Most Expensive States for Millionaires
New Mexico retirement taxes
Thanks to legislation passed last year, most New Mexicans won’t pay state income tax on their Social Security benefits. Taxpayers age 65 and older can deduct up to $8,000 from their taxable income, and income for residents 100 years and older is completely tax-exempt in New Mexico.
Tax on Taxable Income: Low of 1.7% (on up to $5,500 for single filers and $8,000 for joint filers) and a high of 5.9% (on more than $210,000 for single filers and $315,000 for joint filers)
- Social Security: Taxable for single filers who earn more than $100,000 per year (more than $150,00 if married filing jointly)
- Pensions: Partially taxable
- 401(k) and IRA Distributions: Partially taxable
More: New Mexico State Tax Guide
How is retirement taxed in New York?
New York taxes most retirement income, but some taxpayers at least 59.5 years old can deduct up to $20,000 of their pension income (exclusions apply).
Tax on Taxable Income: Low of 4% (on up to $8,500 for single filers and $17,150 for joint filers) and a high of 10.9% (on more than $25,000,000 for all filers)
- Social Security: Not taxable
- Pensions: Taxable (Does not apply to federal, NYS, local, and military retirement income )
- 401(k) and IRA Distributions: Taxable
More: Low-Tax States Gain Residents From California and New York
North Carolina taxes on retirees
North Carolina taxes most types of retirement income. But the state has a low flat income tax rate, and that rate will drop even lower over the next few years.
Tax on Taxable Income: Flat rate of 4.75%
(Note: North Carolina’s income tax rate is set to gradually reduce until 2027 when it reaches 3.99%.)
- Social Security: Not taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
More: North Carolina State Tax Guide
Is retirement income taxable in North Dakota?
Recent legislation has made income tax in North Dakota affordable for many taxpayers. Even for retirement income that is subject to state income tax, the highest rate you will pay is 2.9%.
Tax on Taxable Income: Low of 0% (on up to $44,725 for single filers and $74,750 for joint filers) and a high of 2.9% (on more than $222,975 for single filers and $275,100 for joint filers)
- Social Security: Taxable
- Pensions: Taxable (Excluding military retirement pay)
- 401(k) and IRA Distributions: Taxable
More: North Dakota State Tax Guide
Ohio taxes on retirees
Ohio taxes most types of retirement income, but military retirement pay is tax-exempt, and the state’s tax brackets are low when compared with other states. There is no estate or inheritance tax in Ohio.
Tax on Taxable Income: Low of 2.765% (on up to $46,100) and a high of 3.99% (on more than $115,300)
(Note: Ohio tax brackets depend on residency and filing status.)
- Social Security: Not taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
More: Ohio State Tax Guide
Oklahoma taxes on retirees
Oklahoma offers an income tax exemption of up to $10,000 to retirees age 65 and older. There is no state estate or inheritance tax in Oklahoma.
Tax on Taxable Income: Low of 0.25% (on up to $1,000) and a high of 4.75% (on more than $7,200)
The highest income tax bracket is lower in Oklahoma than in many other states, but most Oklahoma taxpayers fall into the state’s highest bracket.
- Social Security: Not taxable
- Pensions: Partially Taxable
- 401(k) and IRA Distributions: Partially Taxable
More: Oklahoma State Tax Guide
Is Oregon ‘tax-friendly’ for retirees?
Oregon’s income tax brackets are high compared to most other states, and the state taxes most types of retirement income. Oregon also has an estate tax that applies to estates valued over $1 million.
Tax on Taxable Income: Low of 4.75% (on up to $3,750 for single filers and $7,500 for joint filers) and a high of 9.9% (on more than $125,000 for single filers and $250,000 for joint filers)
- Social Security: Not taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
More: Oregon ‘Kicker’ Credit: Who Qualifies and What’s It Worth?
Do retirees pay Pennsylvania income tax?
Pennsylvania doesn’t tax any traditional types of retirement income. Even other types of income are taxed at a low flat rate, but localities in Pennsylvania can impose local income taxes of their own.
Tax on Taxable Income: Flat rate of 3.07%
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: Pennsylvania State Tax Guide
Rhode Island taxes on retirees
Rhode Island taxes most types of retirement income. Income from military pensions is tax-exempt beginning in the 2023 tax year. Also new for 2023 is an increase to Rhode Island’s annuity and pension income exclusions. The new exemption amount is $20,000, which means some taxpayers may qualify for a total exemption of $40,000.
Tax on Taxable Income: Low of 3.75% (on up to $73,450) and a high of 5.99% (on more than $166,950)
- Social Security: Partially Taxable (Income requirements apply)
- Pensions: Partially Taxable
- 401(k) and IRA Distributions: 401(k) distributions (partially taxable) and IRA distributions (fully taxable)
More: 11 States That Tax Social Security Benefits
Is retirement income taxed in South Carolina?
South Carolina offers a retirement income exclusion of up to $10,000. If you have taxable income that exceeds that amount, you’ll pay income taxes in South Carolina. The highest tax bracket was recently reduced from 7% to 6%.
Tax on Taxable Income: Low of 0% ( on up to $3,200) and a high of 6.5% (on more than $16,040)
- Social Security: Not taxable
- Pensions: Partially taxable
- 401(k) and IRA Distributions: Partially taxable
More: South Carolina Tax Relief Following Tropical Storm Idalia
South Dakota taxes on retirees
You won’t pay any state income taxes in South Dakota. That’s because there is no personal income tax in South Dakota. There is no estate or inheritance tax in the state either.
Tax on Taxable Income: N/A
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: South Dakota State Tax Guide
Tennessee taxes on retirees
Tennessee is another state with no income tax, so there is no state tax liability on your retirement income. You don’t need to worry about leaving your heirs with a big state tax bill either. Tennessee doesn’t have an estate or inheritance tax.
Tax on Taxable Income: N/A
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: States That Still Tax Groceries
Texas taxes on retirees
There is no personal income tax in Texas. That means none of your retirement income will be taxed at the state level. There are no estate or inheritance taxes in Texas either.
Tax on Taxable Income: N/A
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: Three Reasons to Move to Texas
How much does Utah tax retirement income?
Utah taxes most retirement income. The state stopped taxing military retirement pay in 2021. Eligible retirees can claim a retirement tax credit of up to $450.
Tax on Taxable Income: Flat rate of 4.65%
- Social Security: Taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
More: Utah State Tax Guide
Vermont taxes on retirees
Many retirees will pay income tax in Vermont. However, Social Security recipients with an AGI of $65,000 or less (if married filing jointly) may qualify for an exemption.
Additionally, Vermont allows a deduction of up to $10,000 for military retirement pay and another deduction of up to $10,000 for some other types of retirement income (including government pensions). The same income requirements apply for the deduction as for the Social Security exemption.
Tax on Taxable Income: Low of 3.35% (on up to $39,600 for single filers and $66,150 for joint filers) and a high of 8.75% (on more than $200,200 for single filers and $273,450 for joint filers)
- Social Security: Partially taxable
- Pensions: Partially taxable
- 401(k) and IRA Distributions: Taxable
More: Vermont Childcare Bill: What Families Should Know
Virginia taxes on retirees
Virginia taxes most types of retirement income. However, retirees age 65 and older may qualify for a tax deduction of up to $12,000. The deduction is decreased if the taxpayer’s AGI exceeds the income threshold ($62,000 for single filers and $87,000 for joint filers).
Tax on Taxable Income: Low of 2% (on up to $3,000) and a high of 5.75% (on more than $17,000)
- Social Security: Not taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
More: Virginia Is Sending 2023 Tax Rebate Checks: What You Need To Know
Washington taxes on retirees
Washington doesn’t have a personal income tax, so you won’t pay state income tax on your retirement benefits. Washington’s capital gains tax is 7% on the sale of some long-term capital assets (such as stocks and bonds) that exceed $250,000 in one year.
Tax on Taxable Income: N/A
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: Capital Gains Tax Upheld in Washington
West Virginia taxes on retirees
West Virginia stopped taxing Social Security in 2022, and West Virginia police pensions are also tax-exempt. Some pensions qualify for a partial pension exclusion (such as some public and government pensions). However, most retirement income is subject to tax in West Virginia but legislation passed in 2023 reduced the tax rate for taxable income.
Tax on Taxable Income: Low of 2.36% (on up to $10,000) and a high of 5.12% (on more than $60,000)
(Note: Income tax rates may differ if you are married and filing separately.)
- Social Security: Not taxable
- Pensions: Taxable (exclusions apply)
- 401(k) and IRA Distributions: Taxable
More: West Virginia State Tax Guide
Wisconsin taxes on retirees
Wisconsin taxes most types of retirement income. However, Social Security isn’t taxed, and taxpayers age 65 and older won’t pay tax on income from federal, local, or state retirement plans (including military retirement benefits).
Tax on Taxable Income: Low of 4% (on up to $11,970 for single filers and $15,960 for joint filers) and a high of 7.65% (on more than $263,480 for single filers and $351,310 for joint filers)
(Note: Some retirees age 65 or older may deduct up to $5,000 of income from a qualified retirement plan. However, income must not exceed the $15,000 for single taxpayers ($30,000 for joint filers.)
- Social Security: Not taxable
- Pensions: Taxable
- 401(k) and IRA Distributions: Taxable
More: Milwaukee Sales Tax Increase: What it Means for Residents
Wyoming taxes on retirees
Wyoming is one of the states with no personal income tax, so you won’t need to pay state income tax on your retirement income or any other type of earnings.
Tax on Taxable Income: N/A
- Social Security: Not taxable
- Pensions: Not taxable
- 401(k) and IRA Distributions: Not taxable
More: Wyoming State Tax Guide
This material is intended for informational/educational purposes only and should not be construed as tax, legal or investment advice, a solicitation, or a recommendation to buy or sell any security or investment product. Investments are subject to risk, including the loss of principal. Some investments are not suitable for all investors, and there is no guarantee that any investing goal will be met. Certain sections of this material may contain forward-looking statements. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is no guarantee of future results. Third-party links are provided to you as a courtesy. We make no representation as to the completeness or accuracy of information provided at these websites. Information on such sites, including third-party links contained within, should not be construed as an endorsement or adoption of any kind. Please consult with your financial professional and/or a legal or tax professional regarding your specific situation and before making any investing decisions.