Georgia has a state income tax on wages, retirement income, and investment gains

Georgia taxes income at the state level. If you work in Georgia, receive a pension, or earn money from investments, you will owe state income tax on those earnings. The state tax rate ranges from 1% to 5.75% depending on your income bracket, and it works alongside the federal income tax you already pay.

Georgia does not tax certain types of income. Social Security benefits are not taxed by the state. Military retirement pay, federal pensions, and some other government pensions have partial or full exemptions. If you are over 65, Georgia offers a retirement income exclusion that can reduce your taxable income.

You file Georgia state taxes separately from federal taxes. Most people use Form IT-40, the Georgia individual income tax return. If you already file federal taxes, you will need to file Georgia taxes as well — the two are not combined into one form.

Key Takeaways

  • Georgia's state income tax rate is 1% to 5.75% depending on your income level, and it applies to wages, retirement income, and investment earnings.
  • Social Security benefits are not taxed by Georgia, and residents over 65 may exclude some retirement income from taxation.
  • You file Georgia state taxes on a separate return from your federal taxes, usually using Form IT-40.
  • Military retirement pay and certain federal pensions receive partial or full exemptions from Georgia state tax.

Georgia income tax brackets and rates for 2024

Georgia uses a progressive tax system, meaning the rate increases as your income increases. Your income is divided into brackets, and you pay the corresponding rate only on income within each bracket — not on your entire income at the highest rate.

The brackets change each year based on inflation. For 2024, the rates start at 1% on the first portion of income and reach 5.75% on income above a certain threshold. The exact dollar amounts for each bracket depend on your filing status (single, married filing jointly, head of household, or married filing separately). You can find the current brackets on the Georgia Department of Revenue website or on your tax forms.

Your employer withholds Georgia state tax from your paycheck if you live and work in Georgia. The amount withheld depends on the W-4 form you complete with your employer. If too much is withheld, you receive a refund when you file. If too little is withheld, you owe the difference.

What income Georgia does not tax

Social Security retirement benefits, survivor benefits, and disability benefits are completely exempt from Georgia state income tax. This applies whether you receive Social Security alone or combined with other income.

Military retirement pay is also exempt. If you retired from the U.S. Armed Forces and receive a military pension, that income is not subject to Georgia state tax. Federal employee pensions and Railroad Retirement benefits receive partial exemptions — you can exclude up to $35,000 of that income from taxation, depending on your age and filing status.

If you are 65 or older, you may exclude up to $65,000 of retirement income from taxation. This includes pensions, annuities, and distributions from retirement accounts like IRAs and 401(k)s. The exclusion does not apply to wages from employment, only to retirement-type income. You must meet age and residency requirements to claim this exclusion.

How to file Georgia state taxes

Most residents file using Form IT-40, the Georgia individual income tax return. You can file on paper by mailing the form to the Georgia Department of Revenue, or you can file electronically through the state's online system or through tax software that supports Georgia returns.

You will need the same documents you use for federal taxes: W-2 forms from your employer, 1099 forms for other income, records of deductions, and proof of any tax payments or withholdings. If you claim the retirement income exclusion, you will need to provide documentation of your age and the source of the retirement income.

The filing deadline for Georgia state taxes is the same as the federal deadline, usually April 15. If you file for a federal extension, the extension also applies to your Georgia return. You can request an extension online through the Georgia Department of Revenue website.

Nonresidents and part-year residents

If you moved to Georgia during the year or worked in Georgia but lived elsewhere, you may file as a part-year resident or nonresident. Part-year residents pay Georgia tax only on income earned while they lived in the state. Nonresidents pay Georgia tax only on income earned from Georgia sources.

You will use Form IT-40NR (nonresident or part-year resident return) instead of the standard IT-40. The form asks you to report only the income subject to Georgia tax and to identify the months you were a resident. If you worked in Georgia but lived in another state, you may owe tax to both states, though you can usually claim a credit on one return for taxes paid to the other.

Tax credits and deductions available in Georgia

Georgia offers several credits that reduce the amount of tax you owe. The Georgia child and dependent care credit helps offset childcare expenses. The Georgia education credit applies to contributions to education savings accounts. The Georgia earned income credit mirrors the federal credit and provides money back to lower-income workers.

You can also deduct charitable contributions, mortgage interest, and property taxes, though you must itemize deductions rather than take the standard deduction to claim them. Georgia follows federal rules for most deductions, so if you itemize on your federal return, you can itemize on your Georgia return as well.

Some credits are refundable, meaning you receive money back even if you owe no tax. Others are nonrefundable, meaning they can only reduce the tax you owe to zero. The Georgia Department of Revenue website lists all available credits and the requirements for each.

Frequently Asked Questions

Do I have to file Georgia taxes if I only receive Social Security?

No. If Social Security is your only income, you do not owe Georgia state tax and do not need to file a Georgia return. However, if you have other income (wages, pensions, investment earnings), you must file and report that income even if your Social Security is not taxed.

What happens if I work in Georgia but live in another state?

You owe Georgia tax on the income you earned in Georgia. You file as a nonresident using Form IT-40NR and report only Georgia-source income. You may also owe tax to your home state, but most states allow a credit for taxes paid to other states to avoid double taxation.

Can I claim the retirement income exclusion if I still work part-time?

The $65,000 retirement income exclusion applies only to retirement-type income (pensions, annuities, IRA distributions), not to wages from employment. If you are 65 or older and work part-time, you can exclude retirement income but must pay tax on your wages.

How do I know if too much tax is being withheld from my paycheck?

Review your pay stub to see how much Georgia tax is being withheld. If you expect a large refund when you file, you can adjust your withholding by completing a new W-4 form with your employer. The Georgia Department of Revenue website has a withholding calculator to help you determine the correct amount.

Is Georgia income tax deductible on my federal return?

Yes, if you itemize deductions on your federal return, you can deduct Georgia state income tax paid. You report this on Schedule A (Itemized Deductions) on your federal Form 1040. The deduction is limited to $10,000 total for all state and local taxes combined.