41 States That Don't Tax Social Security Benefits
Some people who receive Social Security benefits and have other significant sources of income may have up to 85% of their benefits counted in their taxable income calculation. The taxes on Social Security benefits actually contribute a considerable amount of money towards the program itself.
The good news is that in most cases, Social Security income is not taxable at the state level. 41 states do not tax Social Security income at all. In addition, the states that do tax Social Security use less strict rules than the federal government.
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Forty-one U.S. states don't tax Social Security benefits
As of the 2025 tax year:
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Delaware
- Florida
- Georgia
- Hawaii
- Idaho
- Illinois
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Mississippi
- Missouri
- Nebraska
- Nevada
- New Hampshire
- New Jersey
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- South Carolina
- South Dakota
- Tennessee
- Texas
- Virginia
- Washington (state and D.C.)
- Wisconsin
- Wyoming
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Obviously, a few states don't have an income tax. However, in the other cases, the exemption from Social Security can be quite valuable. For instance, if you receive $20,000 per year from Social Security and reside in my home state of South Carolina, which has a top tax rate of 7%, you could save as much as $1,400.
It's worth noting that this list will probably expand in the future. For instance, West Virginia is in the process of eliminating the tax on Social Security benefits, and it will be eliminated by 2026.
What if you reside in one of the other nine states?
With the list mentioned earlier in mind, this means that there are nine states that still tax Social Security benefits to some degree. These are Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont, and West Virginia.
However, in most instances, the rules for Social Security taxes are less strict than those used by the IRS. For example, Colorado only taxes Social Security benefits for recipients under 65 who earn above specific income thresholds.
Just one piece of the tax equation.
It may not be great news for retirees living in one of the nine states that tax Social Security benefits, but it's worth noting that this is just one factor when evaluating how tax-friendly or unfriendly a state is. Many states that tax Social Security benefits tend to have lower taxes in other areas.
For instance, Montana has a tax on Social Security benefits for some residents, yet is also one of just five states with no sales tax. Other states on the list have property taxes that fall significantly below the national average.
The bottom line is that while tax on your Social Security benefits is certainly not ideal, it's essential to take a broader look at the overall tax situation in the state in question.
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