So what’s OUR takeaway?… Taxes aren’t always everything!
A few states that have low or no income taxes might have higher property or sales taxes. For example, while Illinois doesn’t tax your retirement income, it has one of the country’s highest sales and property taxes.
Other low-tax states might have fewer programs that you may find useful, including senior centers and excellent public transportation. So ultimately, WHERE you live in your retirement hugely depends on what you can afford and also what makes you happy.
If you have a beloved grandchild in a high-tax state, you might conclude that the extra taxes are worth being nearby.
Side Note: You might not have paid any taxes on your retirement income, but that doesn’t mean that the state you live in doesn’t tax retirement income under particular conditions: 27 states tax a little bit on retirement or pension income.
Generally, these states limit the amount of tax based on income levels.
If this subject interests you, we have many more great reads! You should also check out: Tax Refunds: 6 Brilliant Ways To Spend Them Wisely
50 thoughts on “Retirement Income Coming In? These 7 Reliable States WON’T Tax You”
I am retired from the State of Texas thru ERS and I am taxed on my retirement and there is all taxes on Estate and inheritances.
texas does not levy an income tax on any personal income, but you will be taxed on realestate and sales tax
Sounds like a basic consumption tax. You make it you keep it. Your choice to spend it where taxed.
Could you give us some examples of personal income, please?
There are no state income taxes in Texas.
Come to Taxifornia if you wish to pay state income taxes.
How is Tennessee not listed? Maybe I missed it?
Tennessee has no state income tax on salaries, wages, bonuses or any other type of work income. Although the state used to tax income earned from interest and dividends, it has repealed this starting with the 2021 tax year.
I missed that too. And I’m wondering why they left Tennessee out because I live in this state and they do not tax your income here either.
I live in Ohio, retired widow for 27 years, had to work because husband died at 48, lost my pension in Steel mills I am still taxed to death because I had to work longer to pay off all his medical bills, and no pension and to build up my Social Security. You cannot get ahead in this state. We are taxed to the hilt here. Tough for retirees to survive.
I would have filed bankruptcy on husbands medical bills to have a fresh start in life.
Except for S.Dakota having low(-est?) $600/mo. avg. rent, MISSISSIPPI (like SD) retired seniors do not pay state income tax, nor tax on Soc.Security or usual retirement pensions.
We are in the ballpark with S.Dakota’s avg. rent, but have shorter mild winters. The MS Gulf Coast (except for ~1 tough hurricane/10-15yrs) has a more Florida “Panhandle” type of ‘winter’–much cheaper than avg. rent+ of Florida.
Trade offs are 7 warm-or-hot months seeking A.C. instead of 5 cold months paying for heat in OH, different species of insects.
If the bills were in his name and your name was not on them you should have never paid them,my wife passed she had bills my lawyer friend said do not pay a penny on them if your name is not on them cause once you do now there your bill so I never have paid them.
I live in Ohio also,same scenario as Angel. My husband passed away at 48 also I also lost my job in the Steel mills after 35 years and my pension went with it. I also worked longer to pay all his medical bills off. So I worked until I was 76. My Social Security is taxed and a really little pension I receive from the job I attained after the Steel Mills went under. So both are taxed. That Social Security money should not be taxed. It was taxed once, But Ohio just taxes everyone to death!
Thank the EPA for destroying the steel industry in the USA starting in 1970… the EPA destroyed York Air Conditioning in York PA over freon…the EPA singlehandedly wrecked American industry over 54 years and no wonder everything is made in China or Mexico where there are no environmental regulations… China and Mexico want EPA regulations to kill off American industry…
why not states need taxes broke for senior citizens that retired don’t think we live o fixed income to
Indiana does tax social security. Indiana taxes social security as frderal irs does
It should be that ALL states and the Federal should tax us seniors. It would help in a big way if all seniors who are living off SS only do not get taxed. Also, those who served in the military should not get taxed. Glad to read about Texas, as I have family who want me to move near them.
Where in USA can you get a meal in an average restaurant for $10 – $15 per person ?? A burger and drink at McDonalds is that price nowadays.
Washington sure does have an estate tax if your estate exceeds $2.193 million
I was thinking of moving out of Texas because the weather is crazy and unpredictable, too stormy, not cool nor cold enough, not usually temperaturate, and gets unbearably hot. It’s either dry, flash flooding, or has humid air with no rain. There’s so much pestilence it’s unreal. It’s also becoming overcrowded by people moving here from all over. The traffic in and around cities, especially the larger ones, is increasingly becoming insanely chaotic. After reading this I’m pondering our options.
What if I live in Thailand, should I pay tax when withdrawing from my Rollover IRA? I am over the age of 59.5.
Tennessee has no State Income Taxes, why are they not listed. It’s the best Tax State there is, the liberals don’t like our State is the answer, because it is conservative and the Friendliest State you will ever find.
Marilynn
My mother believed the garbage about Florida, but she somehow missed that they tax dividends and interest very heavily (aka unearned income tax). My folks were a no-pension family, with lots of stocks and bonds. It was ugly.
I’m still waiting on the governor of Michigan to resend the tax her predecessor authorized.
Did I miss Missouri?
Iowa does not tax social security, IRA withdrawals, or annuity income if you are retired.
I live in Texas . You get double taxed here. You need to pay property tax but if you sale it you get taxed again.
In Indiana we pay in taxes about 12,000 a year between state and federal tax. This is for SSDI, SSA, Retirement from government, and TSP monthly pay out. We own our home and have zero debt, so thank goodness for that otherwise we would be heading for some warmer weather like North Carolina where the grandkids are. We just hate to start over.
I think it would help a LOT if a law were passed stipulating that no person, over the age of 65 pays school tax in this country. The burden should be placed on those who have children every year, in my view. I have never given birth, and yet I will pay school tax until I die? How is that right?
my husband passed away and I am 85 years old so I had to retried and my income is low
Time to move Angel.
I live in Washington state, true we have no state tax but my pension and 403b are taxed. Not collecting SS yet but that is taxed as well.
Alabama does not tax.
I live in Washington State. I don’t think I we are taxed here. Is that true?
Hi Linda. No forms of retirement income are taxable in the state of Washington.
Don’t come to Colorado try are starting to tax you to death do your research real good before you think of coming here I hope that gives you a heads up.
Texas taxes SS and TRS pensions.
I am retired from the Colombian air force with the rank of colonel, can I apply?
Retire in Fiji Islands. Our dollar is twice as strong. Just check some videos on YouTube. Oh, don’t forget to check the local market for fresh and organic fruits and vegetables.
Hi! Thank you for the tip! The Fiji Islands sound incredible!
Kansas doesn’t tax pensions and their getting to go ahead and stop taxing ssn
What about NC?How is there Taxes?
I live in Kansas, they don’t tax pensions and talk on endinding tax on social security. I’m retired military and retired from Johnson County Community College.
Why didn’t you include Iowa? They don’t tax seniors just like the other states that you mention.
Thank you for letting us know Ken. We’ll be sure to include Iowa in our next article.
You missed a state. Tennessee doesn’t have a state income tax either. Why was Tennessee left out?
Hi Mike. Thank you for the tip! We’re glad to hear it and we’ll be sure to include Tennessee on our next list!
I think the state of Connecticut is hard on retirees.
They tax until death. You can’t get ahead. The rents are high, grocery is through the roof, and they nickle and dime you on everything else.
What about North Carolina
Texas and Nevada have high sales taxes on everything including groceries, non prescription medicines, clothing, etc.