When trying to figure out where to retire, one consideration is how much of your income will be taxed.
Depending on where you choose to live, you might get a state tax credit or deduction on some of your retirement income. Or, you might avoid state taxes on your retirement income entirely.
In fact, the following 26 states either don’t levy state income taxes or don’t tax certain types of retirement income, including Social Security benefits, according to an analysis by the Tax Foundation.
We start with the states that fully exempt Social Security benefits from all residents’ income taxes as of 2020 and end with a look at the states that have no income tax at all.
Note, however, that just because a state isn’t on this list doesn’t mean all of its residents will owe state taxes on their Social Security benefits.
For example, some states that tax Social Security give exemptions based on factors like age or income, as the Tax Foundation reports. Other states tax Social Security to the same extent that the federal government taxes it — and only about half of Social Security beneficiaries owe federal taxes on their benefits.
