If you’re a retiree relying on Social Security benefits, where you live can make a big difference to your income. One of the key reasons? State taxes on Social Security. While the federal government may tax your Social Security based on your income level, some states go a step further and tax those benefits again at the state level.
But here’s the good news: 41 states in the U.S. do not tax Social Security benefits at all. That means you get to keep more of your money, which can be especially helpful for seniors living on a fixed income. Let’s break this down in simple terms, go through the full list, and understand what it means for your retirement planning.
What Is Social Security Taxation?
The Social Security program provides monthly payments to retirees, disabled individuals, and survivors of deceased workers. These benefits are often a major part of people’s retirement income.
While the federal government may tax a portion of your benefits (depending on your overall income), states have their say in how they treat Social Security for tax purposes.
Some states follow the federal rule, while others exempt Social Security from taxation altogether, offering some relief to retirees.
Federal vs. State Tax on Social Security
At the federal level, if you earn more than a certain amount in retirement, a portion of your Social Security may be taxed.
- For individuals earning $25,000 or more, or couples earning $32,000 or more, up to 50% of benefits may be taxable.
- For higher earners, up to 85% of benefits can be taxed.
At the state level, it depends on the rules of each state. Luckily, most states choose not to tax these benefits—either because they don’t have a personal income tax, or because they specifically exempt Social Security.
The 41 States That Don’t Tax Social Security
Here is the list of states where your Social Security benefits are completely tax-free:
States With No State Income Tax (and thus no Social Security tax):
- Alaska
- Florida
- Nevada
- South Dakota
- Tennessee
- Texas
- Washington
- Wyoming
- New Hampshire (taxes only interest/dividends, not Social Security)
States That Have State Income Tax But Do Not Tax Social Security Benefits:
10. Alabama
11. Arizona
12. Arkansas
13. California
14. Delaware
15. Georgia
16. Hawaii
17. Idaho
18. Illinois
19. Indiana
20. Iowa
21. Kentucky
22. Louisiana
23. Maine
24. Maryland
25. Massachusetts
26. Michigan
27. Mississippi
28. New Jersey
29. New York
30. North Carolina
31. North Dakota (ended tax on Social Security starting in 2021)
32. Ohio
33. Oklahoma
34. Oregon
35. Pennsylvania
36. South Carolina
37. Virginia
38. West Virginia (phasing out tax entirely by 2026)
39. Wisconsin
40. Vermont (now exempt for lower-income seniors)
41. Connecticut (partial exemption based on income)
Many of these states also provide extra tax breaks or exemptions for seniors, such as deductions on retirement income or property tax relief.
Which States Do Tax Social Security Benefits?
Only a small number of states tax Social Security, and even among these, some offer partial exemptions or only apply the tax based on income thresholds. As of 2025, these states include:
- Colorado – Offers exemption up to $24,000 for seniors aged 65+.
- Kansas – Social Security benefits are exempt if income is under $75,000.
- Minnesota – Allows partial deductions depending on income.
- Missouri – Phasing out tax; seniors earning less than $85,000 (single) or $100,000 (joint) are already exempt.
- Montana – Social Security income is partially taxable.
- Nebraska – Began phasing out Social Security tax in 2022; full repeal by 2025.
- New Mexico – Provides partial exemptions for lower earners, full repeal in discussion.
- Rhode Island – Exempts Social Security if income is below a certain limit (approx. $95,000 single/$115,000 couple).
- Utah – Offers a nonrefundable credit to offset Social Security tax for low-to-mid-income retirees.
Some of these states are in the process of eliminating the tax. For example, Nebraska and Missouri have already passed laws to end taxation by 2025.
Why This Matters for Retirees?
Where you choose to live in retirement isn’t just about the weather—it’s also about your financial well-being. If you’re on a fixed income, even a few hundred dollars saved in taxes can help with bills, groceries, or medical expenses.
Here’s what not taxing Social Security benefits means for you:
- More monthly income stays in your pocket.
- Easier planning and budgeting for retirement.
- Potentially better quality of life during your senior years.
Planning Tip for Seniors
If you’re planning to move in retirement or just starting to collect Social Security, consider checking your state’s tax policies. You can visit your state’s department of revenue website or check federal guidance from the Social Security Administration (SSA) and the IRS.
If you want to compare tax-friendly states, you can also look into the cost of living, healthcare access, property taxes, and other retirement perks offered by state governments.
Conclusion
In summary, 41 U.S. states do not tax Social Security, either because they don’t have a personal income tax or they’ve specifically exempted these benefits. This makes a huge difference for retirees looking to stretch their income.
If you live in one of the 9 states that still tax Social Security, keep an eye on future changes—many states are working to phase out these taxes entirely.
Always consult a tax advisor or financial planner to understand how your state’s rules apply to you and to make smart retirement decisions.