
#2 Hawaii
The state income tax ranges from 1.4% to 11%. The 1.4% applies to married couples that are filing jointly and have a taxable income of a maximum of $4,800 or to married individuals that are filing separately and individual filers that have a taxable income of a maximum of $2,400.
The 11% applies to married couples that are filing jointly or to the surviving spouses that have a taxable income of a maximum of $400,000 or to married individuals that are filing separately and individual filers that have a taxable income of a maximum of $200,000.
Aloha State is well-known for its high cost of living, but retirees may find Hawaii to be a tax haven. The majority of pension income is exempt from state income taxes, as are Social Security benefits. However, Hawaii will tax any additional sources of income at rates as high as 11%.