States That Don't Tax Social Security

Most retirees know the federal government can tax up to 85% of their Social Security benefits. What catches people off guard is that 11 states pile on additional state-level taxes on top of that.

The States That Don't Touch Your Benefits

As of 2026, 39 states plus Washington D.C. do not tax Social Security benefits at the state level. That list includes some obvious names and a few surprises.

The nine states with no income tax at all, including Florida, Texas, Nevada, Wyoming, South Dakota, Tennessee, Alaska, New Hampshire, and Washington, automatically exempt Social Security because they don't tax any income. If you want the full breakdown of those states, our States With No Income Tax in 2026 post covers each one in detail.

Beyond the no-income-tax states, the following states have income taxes but specifically exempt Social Security from them: Alabama, Arizona, Arkansas, California, Delaware, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Virginia, and Wisconsin.

That's a long list. The shorter, more useful list for retirees is the one below.

The 11 States That Still Tax Social Security

These states tax Social Security benefits to at least some degree: Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, and Vermont.

The rules vary significantly by state. Kansas, for example, exempts Social Security for residents with an adjusted gross income under $75,000. Missouri exempts it for individuals earning under $85,000. Minnesota taxes benefits but offers a partial deduction, and the thresholds there phase out at relatively low income levels compared to other states.

Colorado exempts Social Security for residents 65 and older. Utah offers a tax credit rather than a full exemption, and that credit phases out as income rises. Vermont taxes Social Security but exempts it fully for individuals earning under $45,000 and couples earning under $60,000.

The practical takeaway: even in the 11 states that technically tax Social Security, many middle-income retirees pay little or nothing depending on their total income. Run your specific numbers before assuming a state is off the table.

What About Pensions and 401(k) Withdrawals?

Social Security exemption is just one piece of the retirement tax picture. A state can exempt Social Security and still aggressively tax pension income or 401(k) withdrawals.

Pennsylvania is a sharp example. The state exempts Social Security entirely and also exempts most pension and 401(k) distributions for retirees. Illinois follows a similar pattern, with no tax on retirement income of any kind despite having a flat income tax rate of 4.95% on working residents.

On the other end, states like California and New York exempt Social Security but fully tax pension and retirement account withdrawals at their standard income tax rates. California's top rate hits 13.3%, and New York's reaches 10.9% at higher income levels. For retirees pulling $60,000 or more annually from an IRA or 401(k), that difference is not trivial.

If you want to see which states are genuinely pension-friendly across the board, our Best States for Retirees to Avoid Taxes post ranks states on the full retirement tax picture, not just Social Security.

The Retirement Tax Trap Most People Miss

One of the biggest mistakes retirees make with Social Security is assuming that moving to a no-income-tax state solves their entire tax problem. It often helps significantly, but property taxes, sales taxes, and cost of living can offset those savings fast.

Florida has no income tax and no Social Security tax, but median home values in many coastal markets now exceed $450,000, and homeowners insurance costs have surged past $4,000 per year in some counties. Texas has no income tax either, but its effective property tax rate averages around 1.63%, one of the higher rates in the country.

A retiree on a fixed income of $55,000 per year needs to model the full cost picture, not just the income tax line. Use our retirement tax calculator to compare your specific income sources across states side by side.

For a broader look at states where property taxes won't eat your retirement savings, see our States With the Lowest Property Taxes analysis.

Key Takeaways

• 39 states plus D.C. do not tax Social Security benefits as of 2026. Only 11 states still impose some level of tax on benefits.
• Even in states that tax Social Security, income thresholds often exempt middle-income retirees. Kansas exempts benefits for AGI under $75,000; Vermont exempts them for individuals under $45,000.
• Social Security exemption alone doesn't define a retirement-friendly state. California exempts Social Security but taxes 401(k) withdrawals at rates up to 13.3%.

Compare your retirement income tax burden across all 50 states at Live or Die Here and find out exactly where your benefits go furthest.