Best States for Retirees Who Want to Avoid Paying State Taxes on Retirement Income
This article from Yahoo Finance analyzes the best U.S. states for retirees seeking to minimize state taxes on retirement income. It highlights that 41 states do not tax Social Security income, 37 do not tax most military retirement pay, 16 exempt pension income, and 9 have no income tax (including Washington, which taxes only high earners' capital gains). The article profiles seven states offering significant tax breaks: Arkansas (exempts up to $6,000 in pension/IRA income, no Social Security or military tax), Illinois (exempts pensions, 401(k)/IRA withdrawals, Social Security, and military pay), Iowa (no tax on pension/annuity/IRA income for those over 55, flat 3.8% tax rate as of 2025, eliminated inheritance tax), Mississippi (exempts retirement plan distributions, pensions, annuities, Social Security, and military pay), and New Hampshire (partial profile). The piece provides practical guidance for retirees evaluating state tax burdens on various income sources including Social Security, pensions, 401(k)s, IRAs, and military retirement pay.
Editorial responsibility
- No named human review is recorded for this page.
- Reports are grouped by semantic similarity and deterministic rules. Language models may assist titles, summaries, translation and cross-source analysis; the page itself is projected from evidence records.
- Current automated evidence projection
Wire timeline
Best States for Retirees Who Want to Avoid Paying State Taxes on Retirement Income
This article from Yahoo Finance analyzes the best U.S. states for retirees seeking to minimize state taxes on retirement income. It highlights that 41 states do not tax Social Security income, 37 do not tax most military retirement pay, 16 exempt pension income, and 9 have no income tax (including Washington, which taxes only high earners' capital gains). The article profiles seven states offering significant tax breaks: Arkansas (exempts up to $6,000 in pension/IRA income, no Social Security or military tax), Illinois (exempts pensions, 401(k)/IRA withdrawals, Social Security, and military pay), Iowa (no tax on pension/annuity/IRA income for those over 55, flat 3.8% tax rate as of 2025, eliminated inheritance tax), Mississippi (exempts retirement plan distributions, pensions, annuities, Social Security, and military pay), and New Hampshire (partial profile). The piece provides practical guidance for retirees evaluating state tax burdens on various income sources including Social Security, pensions, 401(k)s, IRAs, and military retirement pay.