State income taxes are one area where the difference between states can be dramatic — from zero to nearly 14% on the same income. Understanding your state's retirement tax rules is especially important if you are considering relocating.
States With No Income Tax
These 9 states impose no broad-based individual income tax — meaning Social Security, pension income, RMDs, and investment income are all state-tax-free:
Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming
States That Fully Exempt Social Security
Beyond the no-income-tax states, most remaining states fully exempt Social Security benefits from state income tax. As of 2026, only about 9–11 states still partially or fully tax Social Security at the state level.
Notable State Retirement Tax Rules
| State | SS Tax | Notable Rule |
|---|---|---|
| Pennsylvania | Exempt | ALL pension and retirement account income also fully exempt — one of the most retirement-friendly states |
| Illinois | Exempt | All retirement income including pensions and 401(k)s exempt; flat 4.95% rate on other income |
| Georgia | Exempt | $65,000 retirement income exclusion for age 65+ couples |
| Colorado | Partial | SS may be partially taxable; $24,000 pension exclusion for 65+ |
| Minnesota | Taxable | SS fully taxable above income thresholds; one of the less retirement-friendly states |
| California | Exempt | SS exempt but all other retirement income is fully taxable; top rate 13.3% |
Model Your State Tax Bill Before You Relocate
The Tax Estimator supports all 50 states — compare your current state vs a potential destination.