September 27, 2022

States That Do Not Tax Social Security

Photo of a print-out of taxes and a black coffee cup

Photo by Kelly Sikkema on Unsplash

If you’re looking to retire and save a few bucks, you might want to move to a state that doesn’t tax Social Security. In fact, some retirees leave their home states immediately after leaving work, so they don’t have to pay taxes on those Social Security benefits. After all, taxes can add up quickly, especially for retirees on a fixed income.

Note that while some states tax Social Security and even apply their own income tax to Social Security, they often offer special exemptions or options to reduce or eliminate the tax, usually going by the age or income of the recipients. But, if you want to avoid any confusion, read on for a list of the states that simply don’t tax Social Security.

In total, 37 states, as well as the District of Columbia, don’t tax Social Security benefits. Of those states, nine actually don’t have any income tax. It’s a surprising statistic for people who have paid state income taxes their whole lives.

Here are the U.S. states that don’t have any income tax:

  • Alaska
  • Florida
  • Nevada
  • New Hampshire (Does not tax wages or Social Security but does tax investment income)
  • South Dakota
  • Tennessee
  • Texas
  • Washington
  • Wyoming

The rest of the 28 states, as well as the District of Columbia, have special credits and/or exemptions to enable residents to not have to pay Social Security taxes.

These states that enable residents to not pay Social Security taxes are:

  • 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
  • Wisconsin
  • Washington, D.C.

All in all, if you are a resident of any of the above states, or the District of Columbia, you don’t have to pay any state taxes on your Social Security income. We foresee more gifts for the grandchildren coming soon.