Eight States That Tax Social Security Benefits, and Other Places to Consider for Retirement

Most states do not tax Social Security benefits, but eight states do make exceptions.

Several of those states also offer exemptions for some residents, so it is worth checking whether your state is on the list if you are planning for retirement or thinking about moving. For some people, relocating may make financial sense.

States that tax Social Security benefits

These eight states tax Social Security benefits, though the people who actually owe taxes can vary by age and income:

• Colorado: Residents age 65 and older may subtract all federally taxable Social Security benefits from Colorado state income tax. Those ages 55 to 64 can deduct up to $95,000 if married filing jointly, or up to $75,000 if filing as a single taxpayer.
• Connecticut: Married couples filing jointly may qualify for an exemption if adjusted gross income is below $100,000, while single filers may qualify if AGI is below $75,000. For those above those limits, no more than 25% of Social Security benefits are taxed.
• Minnesota: An exemption applies to married couples earning less than $108,320 and to single filers earning $84,490 or less.
• Montana: Taxpayers age 65 and older can subtract $5,500 from federal taxable income.
• New Mexico: Single filers with income up to $100,000 a year and married couples filing jointly with income below $150,000 a year may qualify for an exemption.
• Rhode Island: Joint filers are taxed on Social Security only if AGI exceeds $133,750. Single filers are taxed if AGI exceeds $107,000.
• Utah: A retirement tax credit of $450 is available to people born on or before Dec. 31, 1952, who do not claim the Social Security benefits credit or the Military Retirement credit.
• Vermont: Married couples filing jointly may receive a full or partial exemption if AGI is under $80,000. For single filers, the cutoff is $65,000.

The newest state to remove the tax

West Virginia has recently stopped taxing Social Security benefits. The change took effect in the tax year 2026 after the state gradually phased out the tax.

Under that phase-out, 35% of Social Security benefits were exempt in 2024, then 65% were exempt in 2025. Social Security benefits are now fully exempt from taxation in West Virginia.

Other retirement destinations to consider

Even in one of the eight states listed above, some retirees may still be exempt from Social Security taxes. But if you do owe taxes on your benefits, that often means you have a relatively high annual income. In that case, no-income-tax states such as Florida, Texas, Tennessee, and Nevada may be worth exploring.

Still, a state with no income tax is not always the most affordable choice overall. Some states offset the lack of income tax with higher property taxes or sales taxes, so it is important to compare the full tax picture before deciding to move.

Taxes on benefits are only one part of retirement planning. Comparing locations can help you decide whether a move makes sense, but if those taxes do not affect your ability to cover living expenses, staying where you are may also be the best option.