Thirteen states tax Social Security benefits, but most do not

Thirteen states currently tax at least some Social Security income: Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, Vermont, and West Virginia. Illinois taxes benefits only for people over 61 who receive them before full retirement age. The remaining 37 states do not tax Social Security benefits at all, regardless of your income level.

The states that tax Social Security use different rules. Some tax only a portion of your benefits. Others apply the tax only if your total income (including non-taxable interest and half your Social Security) exceeds a certain threshold. A few states tax all benefits above a certain income level. Your actual tax bill depends on which state you live in, your total income, and how much you receive in Social Security.

If you move to a different state after you start receiving benefits, your tax situation may change. Some people time moves to retirement specifically to avoid state taxation. If you are considering a move or already receive benefits, knowing your state's rules helps you plan your finances accurately.

Key Takeaways

  • Thirteen states tax Social Security benefits under different rules; 37 states do not tax them at all.
  • States that tax Social Security often use income thresholds, so you may owe tax only if your total income exceeds a specific amount.
  • The amount of your benefit that is taxed varies by state—some tax only a portion, others tax the full amount above the threshold.
  • Moving to a state that does not tax Social Security can reduce your tax burden, though you should verify residency rules before relocating.

States that tax Social Security and how much they take

Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, Vermont, and West Virginia all tax Social Security benefits. Each state sets its own income threshold and tax rate. Below that threshold, you owe no state tax on your benefits. Above it, the amount you owe depends on how much of your benefit the state taxes and what tax bracket you fall into.

Colorado taxes benefits as ordinary income if your federal adjusted gross income plus half your Social Security exceeds $25,000 (single filers) or $32,000 (married filing jointly). Connecticut taxes benefits only if your total income exceeds $15,000 (single) or $20,000 (married). Kansas taxes all benefits as income with no threshold. Minnesota taxes benefits using federal rules—if your benefits are taxable at the federal level, they are taxable in Minnesota too.

Missouri taxes up to 85 percent of benefits if your income exceeds $25,000 (single) or $32,000 (married). Montana taxes benefits as ordinary income. Nebraska taxes benefits as ordinary income if your federal adjusted gross income exceeds $25,000 (single) or $32,000 (married). New Mexico taxes benefits only if your total income exceeds $25,000 (single) or $32,000 (married). Rhode Island taxes benefits using federal rules. Utah taxes benefits as ordinary income. Vermont taxes benefits using federal rules. West Virginia taxes benefits as ordinary income.

Illinois and the age 61 exception

Illinois does not tax Social Security benefits for most people. However, Illinois taxes benefits for people who receive them before reaching full retirement age. Full retirement age depends on your birth year—typically between 66 and 67. If you were born in 1960 or later, your full retirement age is 67.

If you claim benefits before full retirement age and live in Illinois, the state taxes those benefits as ordinary income. Once you reach full retirement age, Illinois stops taxing your benefits, even if you continue to receive them. This rule applies only to Illinois residents; if you move out of state, you follow your new state's rules instead.

How income thresholds work in taxing states

Most states that tax Social Security use an income threshold. You calculate your "combined income" by adding your adjusted gross income, non-taxable interest, and half your Social Security benefits. If this combined income falls below the threshold, you owe no state tax on your benefits. If it exceeds the threshold, you may owe tax on some or all of the amount above the threshold.

The threshold varies by filing status. Single filers typically have a lower threshold than married couples filing jointly. For example, in Colorado, the threshold is $25,000 for single filers but $32,000 for married couples. In Connecticut, it is $15,000 for single filers and $20,000 for married couples. If you are married filing separately, the threshold is usually $0 or very low.

Once your combined income exceeds the threshold, the amount of your benefit that is taxed depends on the state. Some states tax only the amount above the threshold. Others tax a percentage of your total benefit. A few states tax your benefits as ordinary income, meaning they apply your state income tax rate to the benefit amount. You can estimate your liability by calculating your combined income and checking your state's specific rules.

States with no Social Security tax

Alaska, Alabama, Arizona, Arkansas, California, Delaware, Florida, Georgia, Hawaii, Idaho, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Nevada, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Virginia, Washington, Wisconsin, Wyoming, and the District of Columbia do not tax Social Security benefits. If you live in any of these places, your state does not take a portion of your Social Security income, regardless of how much you earn from other sources.

Some of these states have no income tax at all (Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming). Others have income tax but exempt Social Security specifically. If you receive other income—from a pension, investments, or part-time work—those sources may still be taxed in your state, but your Social Security is not.

What happens if you move between states

Your state tax situation on Social Security changes when you move and establish residency in a new state. Most states consider you a resident once you move there with the intent to stay. You do not have to wait a full year; residency can begin the month you move. Once you are a resident, you follow that state's rules for Social Security taxation.

If you move from a state that taxes Social Security to one that does not, you stop owing state tax on your benefits starting in your new state of residence. If you move from a non-taxing state to a taxing state, you begin owing tax in your new state. Some people who are near retirement or already retired move specifically to avoid state taxation, though you should verify that you meet your new state's residency requirements and understand any other tax implications of moving.

If you own property in multiple states or split time between them, residency rules become more complex. Generally, the state where you spend the most time and have your permanent home is considered your state of residence. If you are uncertain, contact the tax authority in each state where you own property or spend significant time.

Federal taxation of Social Security is separate from state taxation

The federal government taxes Social Security benefits based on your combined income, using the same threshold method as some states. If your combined income exceeds $25,000 (single) or $32,000 (married filing jointly), you may owe federal income tax on up to 85 percent of your benefits. This federal tax applies to everyone, regardless of which state you live in.

State taxation is separate from federal taxation. You may owe federal tax, state tax, both, or neither, depending on your state and income level. For example, if you live in Connecticut and your combined income is $18,000, you owe no Connecticut state tax (below the $15,000 threshold for single filers) but you may still owe federal tax if your combined income exceeds the federal threshold. Conversely, if you live in Kansas, which taxes all benefits, you may owe Kansas tax even if your income is below the federal threshold.

Frequently Asked Questions

Do I have to pay state tax on Social Security if I live in a state that taxes it?

Not necessarily. Most taxing states use an income threshold. If your combined income (adjusted gross income plus non-taxable interest plus half your Social Security) stays below the threshold, you owe no state tax on your benefits. Once you exceed the threshold, you may owe tax on some or all of your benefits, depending on your state's specific rules.

Can I avoid state taxation by moving to a non-taxing state?

Yes, but you must establish residency in the new state. Residency typically begins when you move with the intent to stay permanently. You should verify your new state's residency rules and consider other factors before moving, such as cost of living, healthcare access, and proximity to family. Moving solely to avoid taxes may have other financial or personal trade-offs.

If I move after I start receiving Social Security, do I owe back taxes to my old state?

No. You owe state tax only for the year you are a resident of that state. Once you move and establish residency elsewhere, you follow your new state's rules going forward. You do not owe taxes to your former state for benefits received after you moved, even if you received them while still a resident.

Does my state tax Social Security if I also receive a pension?

Your state's taxation of Social Security is separate from its taxation of pensions. Whether you owe state tax on your Social Security depends on your state's rules and your combined income threshold. Your pension is counted as part of your income when calculating whether you exceed that threshold. Both income sources together determine your total tax liability.

What if I am not sure whether my state taxes Social Security?

Contact your state's tax authority or department of revenue directly. You can also find your state listed in the sections above. If your state is not listed among the thirteen that tax benefits, it does not tax Social Security. Your state's tax website usually has a section on Social Security taxation or a phone number for questions.