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This Is How All 50 States Tax Your Retirement Income

May 27, 2022 · Retirement Life
retirement
Photo by Nagel Photography from Shutterstock

Illinois

Illinois doesn’t tax Social Security income. The state’s individual income tax rate is 4.95 percent. Different types of retirement income might be exempt from state taxation, as the state confirmed.

Besides Social Security benefits, they might include retirement income either from qualified employee benefit plans, individual retirement accounts (IRAs) or even self-employed retirement plans, government retirement and government disability options, and group term life insurance premiums that are paid by a qualified retirement plan, state or local government deferred compensation plan or specific capital gains on employer securities.

Indiana

Indiana doesn’t tax Social Security income. The individual income tax rate here is a flat 3.23 percent. Even so, a portion of military pensions might still be excluded, as it depends on the taxpayer’s age.

Some income from a federal civil-service annuity might be deducted from adjusted gross income.

Iowa

Iowa doesn’t tax Social Security income. Individual income tax rates can range from 0.33 to 8.53 percent. Military benefits might be exempt, and multiple other types of retirement income might qualify for exclusion from taxable income.

Taxpayers that are 55 or older or disabled have the possibility to exclude a maximum of $6,000 if they are single or $12,000 if they’re married.

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2 comments on “This Is How All 50 States Tax Your Retirement Income”

  1. Gary Loock says:
    October 10, 2022 at 2:29 pm

    I understand that the Maryland Legislature just changed how much retirees pay in income taxes. I have not been able to find out the specifics of the new law. When does it take effect? What are the income limits? Can I now reduce the State witholding from my Minimum Required Diatributions?

    Reply
  2. claudette minichiello says:
    September 29, 2022 at 3:23 pm

    how much are senior,s taxed in kentucky?

    Reply
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