Retirement Taxes by State: How Every State Taxes Social Security, Pensions, and IRA/401(k) and More?
When people ask, “Where should I retire for taxes?”, they’re usually thinking about one thing—state income tax. This guide summarizes how each state — and the District of Columbia — taxes major retirement income, what estate and inheritance taxes apply, and where to find each jurisdiction's official tax resources.
Important: Dollar amounts, age thresholds, and AGI phaseouts change when legislatures update the law.
The 5 retirement income “buckets” states tax differently
Before you compare states, separate your income into buckets:
Social Security
Pensions (private + government; sometimes military is different)
401(k) / IRA distributions
Wages (if you’ll work part-time in retirement)
Interest/dividends/capital gains (brokerage accounts)
Most states mix-and-match exemptions and deductions across these buckets—so two retirees in the same state can end up with very different tax results. The summary below draws on Kiplinger’s Retirement Taxes: How All 50 States Tax Retirees.
Alabama
Income tax: Graduated; roughly 2% on small taxable income up to about 5% on higher incomes.
· Social Security: Not taxable
· Pensions: Not taxable
· 401(k) / IRA: First $6,000 of retirement-plan distributions may be exempt for taxpayers age 65+; remainder follows normal rules
State tax guide: [Alabama Department of Revenue — Individual income tax](https://www.revenue.alabama.gov/individual-income-tax/)
Alaska
Income tax: No statewide personal income tax.
· Retirement income: Not taxed at the state level
State tax guide: [Alaska Department of Revenue — Tax division](https://tax.alaska.gov/)
Arizona
Income tax: Flat rate (about 2.5% in recent law).
· Social Security: Not taxable
· 401(k) / IRA: Taxable
· Pensions: Taxable; some types may qualify for up to $2,500 exemption
State tax guide: [Arizona Department of Revenue — Individual income tax](https://azdor.gov/individual-income-tax)
Arkansas
Income tax: Graduated; 0% on lower income, top rate about 3.9%; high earners may reach upper brackets sooner than mid-income filers.
· Social Security: Not taxable
· 401(k) / IRA: Taxable
· Pensions: Taxable; military pensions often exempt
· Age 59½+: Up to $6,000 deduction for eligible retirement income
State tax guide: [Arkansas Department of Finance and Administration — Income tax](https://www.dfa.arkansas.gov/income-tax/)
California
Income tax: Multiple brackets; top rates can exceed 13% on very high taxable income; additional payroll-related taxes can apply to wages while still working.
· Social Security: Not taxable
· 401(k) / IRA / pensions: Generally taxable
State tax guide: [California Franchise Tax Board](https://www.ftb.ca.gov/file/index.htm)
Colorado
Income tax: Flat rate (about 4.4% for recent tax years).
· Social Security: Partially taxable—many retirees use subtractions (e.g., $20,000 at 55+, $24,000 at 65+)
· Pensions: Partially taxable
· 401(k) / IRA: Taxable
State tax guide: [Colorado Department of Revenue — Income tax](https://tax.colorado.gov/income-tax)
Connecticut
Income tax: Graduated; top rates near 7% on large incomes.
· Social Security: Partially taxable—exemption under AGI thresholds (e.g., $75k single / $100k joint) with ongoing legislative changes
· Pensions / 401(k) / IRA: Partially taxable—may be exempt or partly exempt depending on income tests
· Estate tax: Exemption often tracked near the federal estate exclusion (commonly cited about $15,000,000 in recent summaries); Connecticut is distinct for also imposing a state gift tax tied to its estate system. Top estate rates often cited ~10.8%–12%—use Connecticut DRS estate and gift tax publications.
State tax guide: [Connecticut Department of Revenue Services — Individual Income Tax](https://portal.ct.gov/DRS/DRS-Individuals/DRS-Individual-Income-Tax)
Delaware
Income tax: Graduated; top rate about 6.6% on higher incomes.
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Partially taxable—age 60+ may exclude up to $12,500 of qualified retirement income
State tax guide: [Delaware Division of Revenue — Individual income tax](https://revenue.delaware.gov/individual-income-tax/)
District of Columbia
Income tax: Graduated; top rates near 10.75% on very high incomes.
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Taxable; up to $3,000 retirement income deduction may apply
· Estate tax: Exemption often cited about $4,988,400; graduated rates often cited ~11.2%–16%—confirm on DC OTR estate tax guidance.
State tax guide: [Office of Tax and Revenue — Individual income tax](https://otr.cfo.dc.gov/page/individual-income-tax)
Florida
Income tax: None.
· Retirement income: Not taxed by Florida at the state level
State tax guide: [Florida Department of Revenue](https://floridarevenue.com/)
Georgia
Income tax: Flat rate (about 5.39% in recent law).
· Social Security: Not taxable
· 401(k) / IRA / pensions: Partially taxable—age 62+ may exclude up to $35,000; 65+ up to $65,000 of retirement income (subject to rules)
State tax guide: [Georgia Department of Revenue — Individual income tax](https://dor.georgia.gov/individual-income-tax)
Hawaii
Income tax: Graduated; top rates near 11%.
· Social Security: Not taxable
· Pensions: Not taxable if you did not make after-tax employee contributions (verify plan)
· 401(k) / IRA: Taxable
· Estate tax: Exemption often cited about $5,490,000; graduated rates often cited ~10%–20%—confirm Hawaii Department of Taxation estate tax forms.
State tax guide: [Hawaii Department of Taxation](https://tax.hawaii.gov/)
Idaho
Income tax: Flat rate (about 5.8%).
· Social Security: Not taxable
· Pensions: Partially taxable—possible military/government exemptions
· 401(k) / IRA: Taxable
State tax guide: [Idaho State Tax Commission — Income tax](https://tax.idaho.gov/income-tax/)
Illinois
Income tax: Flat rate (about 4.95%).
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Many qualified retirement distributions are exempt—definitions matter
· Estate tax: $4,000,000 exemption in state law; graduated rates often cited ~0.8%–16% on taxable estate.
State tax guide: [Illinois Department of Revenue — Individuals](https://tax.illinois.gov/individuals.html)
Indiana
Income tax: Flat rate (about 3.05% in recent years).
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Taxable
State tax guide: [Indiana Department of Revenue — Individual income tax](https://www.in.gov/dor/individual-income-tax/)
Iowa
Income tax: According to state documents, a flat individual income tax rate of 3.8% is in effect for 2026.
· Social Security: Not taxable
· Retirement income: Broadly exempt for age 55+; younger taxpayers follow different rules
· Inheritance tax: Repealed for deaths on or after January 1, 2025 (confirm for older estates)
State tax guide: [Iowa Department of Revenue — Individual income tax](https://tax.iowa.gov/individual-income-tax)
Kansas
Income tax: Graduated; roughly 3.1% to 5.7% on higher incomes.
· Social Security: Not taxable
· Public pensions: Often exempt; private pensions and 401(k)/IRA generally taxable
State tax guide: [Kansas Department of Revenue — Individual income tax](https://www.ksrevenue.gov/individual-income-tax.html)
Kentucky
Income tax: Flat rate (about 4%).
· Social Security: Not taxable
· Pensions: Partially taxable—$31,110 deduction for certain state, private, and military retirement plans
· 401(k) / IRA: Taxable
· Inheritance tax: Yes (class-based rates)
State tax guide: [Kentucky Department of Revenue — Individual](https://revenue.ky.gov/Individual/Pages/default.aspx)
Louisiana
Income tax: Graduated; roughly 1.85% to 4.25%.
· Social Security: Not taxable
· Pensions: Public/government pensions may be exempt; others taxable
· 401(k) / IRA: Taxable
· Age 65+: Up to $6,000 income exclusion (verify eligibility)
State tax guide: [Louisiana Department of Revenue — Individual income tax](https://www.revenue.louisiana.gov/IndividualIncomeTax)
Maine
Income tax: Graduated; roughly 5.8% to 7.15% on higher incomes.
· Social Security: Not taxable
· Pensions: Partially taxable—federal pension may be exempt; large pension deduction (confirm annual amount)
· 401(k) / IRA: Taxable
· Estate tax: Exemption often cited about $7,000,000; rates often cited ~8%–12%—confirm Maine Revenue Services estate tax.
State tax guide: [Maine Revenue Services — Income tax](https://www.maine.gov/revenue/income-tax)
Maryland
Income tax: State graduated rates from 2% up to 6.5% on high Maryland taxable income (with 6.25% and 6.5% tiers on upper income in recent law); plus county or Baltimore City income tax (often about 2.25%–3.30% depending on residence and, in some counties, income).
· Social Security: Not taxable (coordination with pension exclusion matters)
· Pensions / 401(k) / IRA: Taxable; pension exclusion up to about $42,000 for 65+ (indexed—confirm annually)
· Capital gains: An additional 2% applies to net capital gains when federal AGI (FAGI) exceeds $350,000 (exceptions apply)—see the Comptroller’s [Technical Bulletin 58](https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/legal-publications/technical-bulletins/tb-58.pdf) and Form 502CG.
· Estate and inheritance: Both may apply—estate tax exemption often cited about $5,000,000 with graduated rates ~0.8%–16% on the taxable estate; inheritance tax is separate (rates and exclusions depend on relationship to the decedent and asset type).
State tax guide: [Maryland Comptroller — Individual income tax](https://www.marylandcomptroller.gov/taxes/individual/)
Massachusetts
Income tax: 5% on Massachusetts taxable income at or below the annual surtax threshold; additional 4% on Massachusetts taxable income above the threshold (so 9% on the excess only—Fair Share Amendment / “millionaires tax”).
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Taxable (some public pensions may be exempt)
· Surtax threshold (indexed): $1,083,150 for tax year 2025; confirm later years on Mass.gov.
· Estate tax: Exemption $2,000,000 in many summaries; graduated rates often cited ~0.8%–16% (watch for cliff rules near the exemption).
State tax guide: [Massachusetts Department of Revenue — Personal income tax](https://www.mass.gov/income-tax)
Michigan
Income tax: Flat about 4.25%.
· Social Security: Not taxable
· Retirement income: Public Act 4 of 2023 (and related law) phases in exclusions for pension/401(k)/IRA-type income—by 2026 many maximum subtractions are fully phased in (e.g., ~$67,610 single / ~$135,220 joint for 2026 in state guidance—confirm). Use [Michigan Department of Treasury — PA 4 FAQs](https://www.michigan.gov/ors/faqs-for-public-act-4-of-2023---retirement-state-tax-changes).
State tax guide: [Michigan Treasury — Individual income tax](https://www.michigan.gov/taxes/iit)
Minnesota
Income tax: Graduated; roughly 5.35% to 9.85%.
· Social Security: Partially taxable
· Pensions / 401(k) / IRA: Taxable; military retirement may be deducted
· Investment income: For taxable years beginning after December 31, 2023, Minnesota imposes a 1% tax on Minnesota net investment income over $1,000,000 (individuals, estates, trusts); net investment income follows the federal definition (IRC § 1411).
· Estate tax: Exemption $3,000,000 in many summaries; top rates often cited ~13%–16%—confirm Minnesota Department of Revenue estate tax.
State tax guide: [Minnesota Department of Revenue — Individual income tax](https://www.revenue.state.mn.us/individual-income-tax)
Mississippi
Income tax: Flat rate stepping down toward 4% in recent years.
· Social Security / pensions / 401(k) / IRA: Generally not taxed for qualifying retirement income; early withdrawals may differ
State tax guide: [Mississippi Department of Revenue — Individual income tax](https://www.dor.ms.gov/individual-income-tax)
Missouri
Income tax: Graduated; roughly 2% to 4.8%.
· Social Security: Not taxable (statewide exemption for benefits 2024+)
· Pensions: Partially taxable
· 401(k) / IRA: Taxable
State tax guide: [Missouri Department of Revenue — Individual](https://dor.mo.gov/individual/)
Montana
Income tax: Graduated; roughly 4.7% to 5.9% (recent years).
· Social Security: Taxable with partial deduction (rules change—verify)
· Pensions / 401(k) / IRA: Taxable; ~$5,500 retirement deduction for qualified income in recent law
State tax guide: [Montana Department of Revenue — Individual income tax](https://mtrevenue.gov/individual-income-tax/)
Nebraska
Income tax: Graduated; roughly 2.46% to 5.84% on higher incomes.
· Social Security: Not taxable (2025+ for many filers under repeal phase-in)
· Pensions: Taxable; military retirement exempt
· 401(k) / IRA: Taxable
· Inheritance tax: Yes
State tax guide: [Nebraska Department of Revenue — Individual income tax](https://revenue.nebraska.gov/individual-income-tax)
Nevada
Income tax: None.
· Retirement income: Not taxed at the state level
State tax guide: [Nevada Department of Taxation](https://tax.nv.gov/)
New Hampshire
Income tax: No broad tax on wages; interest and dividend tax was phased out (effective 2025 for many years).
· Retirement income: Not taxed at the state level
State tax guide: [New Hampshire Department of Revenue Administration](https://www.revenue.nh.gov/)
New Jersey
Income tax: Graduated; top rates near 10.75%.
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Partially taxable—large pension/retirement deductions for 62+ when federal AGI is below caps ($150,000 in many summaries)
· Estate tax: None for deaths on or after January 1, 2018 (repealed—verify date of death for older estates)
· Inheritance tax: Yes—rates depend on beneficiary class (many immediate family transfers exempt)
State tax guide: [New Jersey Division of Taxation — Individuals](https://www.state.nj.us/treasury/taxation/individual/index.shtml)
New Mexico
Income tax: Graduated; top rate about 5.9% on high incomes.
· Social Security: Taxable for high-income filers (e.g., $100k+ single / $150k+ joint in many summaries); others often exempt
· Pensions / 401(k) / IRA: Partially taxable
· Age 65+: Up to $8,000 deduction; age 100+ income may be exempt
State tax guide: [New Mexico Taxation and Revenue — Individual income tax](https://www.tax.newmexico.gov/individual-income-tax/)
New York
Income tax: Graduated; top rates near 10.9% on very high incomes.
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Partially taxable—$20,000 exclusion for qualifying ~59½+ retirement income in many cases (see Publication 36)
· Estate tax: Exemption often cited about $7,350,000; rates often cited ~3.06%–16%. New York is known for a cliff: if the taxable estate exceeds the basic exclusion by more than 5%, the estate may lose the benefit of the exclusion entirely—follow Form ET-706 and current instructions.
State tax guide: [New York State Department of Taxation and Finance — Personal income tax](https://www.tax.ny.gov/pit/default.htm)
North Carolina
Income tax: Flat rate (about 3.99% in 2026 in many summaries); scheduled cuts toward ~2.99% by 2028.
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Taxable
State tax guide: [North Carolina Department of Revenue — Individual income tax](https://www.ncdor.gov/individual-income-tax)
North Dakota
Income tax: Graduated; 0% on lower income, top about 2.5%.
· Social Security: Not taxable
· Pensions: Taxable; military retirement exempt
· 401(k) / IRA: Taxable
State tax guide: [North Dakota Office of State Tax Commissioner — Individual Income Tax](https://www.tax.nd.gov/individual-income-tax)
Ohio
Income tax: Moving toward flat rate (about 2.75% in 2026 in many summaries); verify brackets during transition.
· Social Security: Not taxable
· Military retirement: Exempt
· Other pensions / 401(k) / IRA: Taxable
State tax guide: [Ohio Department of Taxation — Individual](https://tax.ohio.gov/wps/portal/gov/tax/individual)
Oklahoma
Income tax: Graduated; top rate about 4.75% on modest income thresholds.
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Partially taxable—65+ $10,000 exemption in many cases
State tax guide: [Oklahoma Tax Commission — Income tax (individuals)](https://oklahoma.gov/tax/helpcenter/income-tax.html)
Oregon
Income tax: Graduated; top rate about 9.9%.
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Taxable
· Estate tax: Yes—exemption $1,000,000 (not indexed in the same way as federal); graduated rates often cited ~10%–16%.
State tax guide: [Oregon Department of Revenue — Individuals](https://www.oregon.gov/dor/programs/individuals/Pages/default.aspx)
Pennsylvania
Income tax: Flat about 3.07%.
· Social Security / pensions / 401(k) / IRA: Often not taxed for qualifying retirement income—local earned-income taxes may still apply
· Inheritance tax: Yes
State tax guide: [Pennsylvania Department of Revenue — Personal income tax](https://www.revenue.pa.gov/FormsandPublications/Pages/default.aspx)
Rhode Island
Income tax: Graduated; roughly 3.75% to 5.99%.
· Social Security: Partially taxable
· Pensions: Partially taxable—military pensions exempt; $20,000 / $40,000 exemptions in some cases
· 401(k) vs IRA: Treatment can differ—confirm instructions
· Estate tax: Exemption inflation-indexed (often cited about $1,838,056 in recent years); graduated rates often cited ~0.8%–16%.
State tax guide: [Rhode Island Division of Taxation](https://tax.ri.gov/)
South Carolina
Income tax: Graduated; top rates about 6.2%.
· Social Security: Not taxable
· Pensions / 401(k) / IRA: Partially taxable—$15,000 retirement exclusion (rules apply)
State tax guide: [South Carolina Department of Revenue — Individual income tax](https://dor.sc.gov/individual)
South Dakota
Income tax: None.
· Retirement income: Not taxed at the state level
State tax guide: [South Dakota Department of Revenue](https://dor.sd.gov/)
Tennessee
Income tax: None (Hall tax on dividends/interest was repealed).
· Retirement income: Not taxed at the state level
State tax guide: [Tennessee Department of Revenue — Taxes](https://www.tn.gov/revenue/taxes/income-tax)
Texas
Income tax: None.
· Retirement income: Not taxed at the state level
State tax guide: [Texas Comptroller — Taxes](https://comptroller.texas.gov/taxes/)
Utah
Income tax: Flat about 4.5% (recent years).
· Social Security: Taxable—retirement credit of up to $450 for eligible retirees
· Military retirement: Not taxable
· Other pensions / 401(k) / IRA: Taxable
State tax guide: [Utah State Tax Commission — Individual income tax](https://tax.utah.gov/individual-income-tax)
Vermont
Income tax: Graduated; roughly 3.35% to 8.75%.
· Social Security: Partially taxable—exemption under AGI thresholds
· Military retirement: Up to $10,000 deduction; other retirement income up to $10,000 with same tests in many cases
· 401(k) / IRA: Taxable
· Estate tax: Exemption often cited about $5,000,000; top rate on largest estates often cited 16%—confirm Vermont Department of Taxes estate tax.
State tax guide: [Vermont Department of Taxes — Individuals](https://tax.vermont.gov/individuals)
Virginia
Income tax: Graduated; roughly 2% to 5.75%.
· Social Security: Not taxable
· 65+ deduction: Up to $12,000—phases down when AGI exceeds ~$50,000 single / ~$75,000 joint
· Pensions / 401(k) / IRA: Taxable absent other subtractions
State tax guide: [Virginia Department of Taxation — Individual income tax](https://www.tax.virginia.gov/individual-income-tax)
Washington
Income tax: No broad personal income tax on wages or retirement distributions.
· Social Security / pensions / 401(k) / IRA: Not taxed as state income tax
· Capital Gains: Washington imposes a separate capital gains excise on certain long-term gains allocated to the state after a large annual deduction. Retirement accounts and real estate are generally excluded.
· Estate tax: For 2026 deaths, filing threshold and applicable exclusion are $3,076,000 each. Tax on Washington taxable estate uses Table W (e.g., 10% on the first $1,000,000 of taxable estate, then 15%, 17%, 19%, 23%, 26%, 30%, 35% on amounts above $9,000,000).
State tax guide: [Washington Department of Revenue — Taxes](https://dor.wa.gov/)
West Virginia
Income tax: Graduated; roughly 2.2% to 4.82%.
· Social Security: Fully exempt for tax year 2026 after multi-year phase-in (verify HB 4880 rules) · Pensions / 401(k) / IRA: Taxable with normal subtractions
State tax guide: [West Virginia Tax Division — Individuals](https://tax.wv.gov/Individuals/Pages/TaxTypes.aspx)
Wisconsin
Income tax: Graduated; roughly 3.5% to 7.65% on high incomes.
· Social Security: Not taxable
· Federal/state/local government pensions (including military): 65+ often not taxed
· Age 67+: Possible $24,000 / $48,000 exclusion for other retirement income
· 401(k) / IRA: Taxable absent exclusions
State tax guide: [Wisconsin Department of Revenue — Individuals](https://www.revenue.wi.gov/Pages/Individuals/home.aspx)
Wyoming
Income tax: None.
· Retirement income: Not taxed at the state level
State tax guide: [Wyoming Department of Revenue](https://revenue.wyo.gov/)
“No income tax” states: simple headline, not always simple outcome
As of 2026, nine states are commonly cited as having no broad personal state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
That usually means Social Security, pension income, and IRA/401(k) distributions are not subject to state income tax in those states.
Important nuances: “No income tax” does not mean “no state taxes.” For example, Washington has no broad income tax on wages or retirement distributions but imposes a separate capital gains excise on certain taxable-account long-term gains (with common exclusions such as retirement accounts); it also has an estate tax that can matter for some estates. States without income tax often lean more heavily on sales tax, property tax, fees, and other levies—so whether a state is “tax-friendly” for you still depends on spending, housing, and wealth (homeowner vs. renter, spending level, portfolio mix, and estate size).
Disclaimer: This article is for educational and informational purposes only and does not constitute investment, tax, legal, or insurance advice. Any strategies discussed may not be suitable for every individual and may involve risks, including the possible loss of principal. Please consult your financial advisor, tax professional, and/or attorney regarding your specific situation before making any financial decisions.