Which States Don't Tax Your Social Security: A 2024 State-by-State Guide

As 2024 closes, over 51 million American retirees are receiving Social Security benefits—a critical income pillar for retirement planning. While these benefits provide essential income security, they come with a complex tax landscape that varies dramatically by state. The question of whether your Social Security income faces state taxes depends heavily on where you live, making it crucial to understand your specific situation.

The favorable news: 41 states don’t tax your Social Security

Here’s what makes retirement planning easier for most Americans: the majority of states currently exempt Social Security benefits from state income taxation. As of 2024, 41 states plus Washington, D.C. do not tax Social Security benefits, creating significantly better after-tax income for retirees living in these jurisdictions.

Recent legislative momentum has expanded this list. Missouri, Nebraska, and Kansas all eliminated their state Social Security taxes in 2024 alone, joining the ranks of tax-free states. This growing trend reflects increasing recognition that protecting retirement income supports older Americans and potentially attracts retirees to these states.

The states offering full Social Security tax exemptions span across the nation, including major population centers like California, Texas, Florida, and New York, as well as smaller states from Alaska to Wyoming. For retirees in these jurisdictions, 100% of their Social Security income remains protected from state taxation.

The challenging reality: Nine states still tax your benefits

Unfortunately, not all Americans receive this benefit. Nine states continue to tax Social Security benefits: Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont, and West Virginia. These states apply their standard state income tax rates to Social Security benefits, potentially reducing retirement income significantly.

However, change may be coming. West Virginia recently enacted phased elimination legislation, offering hope for residents. Starting with the 2024 tax year, individuals earning under $50,000 and married couples earning under $100,000 gained relief—35% of benefits were exempt. The exemption increased to 65% for 2025, with complete exemption anticipated by 2026.

Federal taxation applies everywhere—here’s how it works

Even if you live in one of the 41 states that don’t tax your Social Security, federal taxes still apply to your benefits regardless of location. The IRS calculates federal tax liability using “combined income,” which includes:

• Adjusted gross income (AGI): All non-Social Security income sources
• Nontaxable interest: Tax-exempt interest like U.S. Treasury bonds
• 50% of your annual Social Security benefits

The IRS then applies tier thresholds based on your filing status. For single filers, combined income thresholds start at $25,000; married couples filing jointly face a $32,000 threshold. These brackets determine what percentage of benefits become eligible for federal taxation:

Understanding the difference between “eligible” and “taxed”

A critical distinction exists between what portion of benefits becomes eligible for taxation versus the actual tax owed. The percentages above determine eligibility, not the final tax rate applied.

Consider a married couple filing jointly with $50,000 in combined income receiving $30,000 annually in Social Security benefits. While 85% of their benefits ($25,500) becomes eligible to be added to their taxable income, this amount faces taxation at their ordinary income tax bracket—not at an 85% rate.

In the 22% tax bracket, this scenario means owing approximately $5,610 on the $25,500 eligible amount, rather than paying 85% of the full $30,000 benefit ($25,500). Understanding this distinction significantly impacts retirement income planning.

Strategic takeaways for retirement planning

Your state of residence matters substantially for Social Security taxation. Living in one of the 41 states without Social Security taxes provides genuine tax savings compared to the nine states with such levies. However, federal tax implications reach every retiree regardless of state, making it essential to calculate combined income and understand your personal tax bracket.

As more states eliminate Social Security taxes and federal rules remain consistent, monitoring your individual tax situation continues to be essential for maximizing retirement income security.