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How Retirement Income Is Taxed in Every State

6 min Read
Heather Taylor Written by Heather Taylor
Chris Cluff Edited by Chris Cluff

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Every state taxes retirement income a bit differently. More often than not, the way retirement income is taxed can impact a person’s decision on where to spend retirement.

The good news is there is a healthy chunk of states that won’t tax certain types of retirement income, like Social Security or pensions. GOBankingRates referenced TIME Stamped’s breakdown of how every state taxes retirement income and the results reveal a surprising number of tax-friendly states across the United States. 

Take a look at how retirement income is taxed across America.

Alabama

  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax pension, but will tax 401(k)s and IRAs
  • Doesn’t tax military retirement income

Alaska

  • No state income tax
  • No income tax
  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Arizona

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Arkansas

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income
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California

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Colorado

  • Won’t tax your estate or inheritance
  • Does tax your Social Security income

Connecticut

  • Doesn’t tax military retirement income

Delaware

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Florida

  • No state income tax
  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Georgia

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Hawaii

  • Won’t tax Social Security income
  • Won’t tax pension income
  • Will tax 401(k)s and IRAs
  • Doesn’t tax military retirement income

Idaho

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Illinois

  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Doesn’t tax military retirement income

Indiana

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Iowa

  • Won’t tax Social Security income (but used to help determine filing status)
  • Won’t tax pension income (but used to help determine filing status)
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Kansas

  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income
  • Does tax Social Security income

Kentucky

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Louisiana

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

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Maine

  • Won’t tax Social Security income
  • Doesn’t tax military retirement income

Maryland

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Massachusetts

  • Won’t tax Social Security income
  • Doesn’t tax military retirement income

Michigan

  • Doesn’t tax military retirement income
  • Does tax Social Security income

Minnesota

  • Doesn’t tax military retirement income
  • Does tax Social Security income

Mississippi

  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Doesn’t tax military retirement income

Missouri

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Montana

  • Won’t tax your estate or inheritance
  • Does tax Social Security income

Nebraska

  • Won’t tax your estate or inheritance
  • Does tax Social Security income

Nevada

  • No state income tax
  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

New Hampshire

  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax pension, but will tax 401(k)s and IRAs
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

New Jersey

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

New Mexico

  • Won’t tax your estate or inheritance
  • Does tax Social Security income

New York

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income
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North Carolina

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

North Dakota

  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income
  • Does tax Social Security income

Ohio

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Oklahoma

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Oregon

  • Won’t tax Social Security income

Pennsylvania

  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Rhode Island

  • Won’t tax Social Security income
  • Won’t tax pension income
  • Doesn’t tax military retirement income

South Carolina

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

South Dakota

  • No state income tax
  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Tennessee

  • No state income tax
  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Texas

  • No state income tax
  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Utah

  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income
  • Does tax Social Security income
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Vermont

  • Won’t tax Social Security income
  • Won’t tax pension income
  • Doesn’t tax military retirement income

Virginia

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance

Washington

  • No state income tax
  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

West Virginia

  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income
  • Does tax Social Security income

Wisconsin

  • Won’t tax Social Security income
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

Wyoming

  • No state income tax
  • Won’t tax Social Security income
  • Won’t tax pension income
  • Won’t tax Thrift Savings Plan (TSP) income
  • Won’t tax 401(k) or IRA
  • Won’t tax your estate or inheritance
  • Doesn’t tax military retirement income

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