As of now, there are forty-three states that levy personal income taxes. Out of these, thirty-eight states have a certain level of exemption when it comes to retirement income. However, each state has a different approach to senior tax breaks for retirees. While individual states may exempt some kinds of retirement income, they may tax other types of income. Currently, there are only two states which exempt all types of retirement income. But, if you are also planning a retirement based on the retirement taxes, then here is exactly what you need to know.

Senior tax breaks for retirees
In the country, the states which have an income tax allow retirees to exclude a certain percentage of their pension income or the benefits derived from their social security for taxation. As it stands now, states which allow complete pension income exemption for eligible retired seniors include the following:

• Alaska
• New Hampshire
• Florida
• Illinois
• Wyoming
• Nevada
• Washington
• Pennsylvania
• South Dakota
• Mississippi
• Tennessee
• Texas

Apart from this, there are certain states which exempt a certain portion of retirees’ pension income from taxation. The list of these states is as follows:

• Alabama
• Arkansas
• Georgia
• Colorado
• Kentucky
• Delaware
• Iowa
• Hawaii
• Ohio
• New Jersey
• South Carolina
• Missouri
• Louisiana
• Maryland
• Maine
• Oklahoma
• Michigan
• Wisconsin
• Montana
• Utah
• New Mexico
• New York
• Virginia

States with unfavorable senior tax breaks for retirees

There are certain states that you would wish to skip. They are unfavorable for senior tax breaks for retirees as tax rates are quite high and they also completely tax the pension income. An insight into some of these states is as follows:

• Arizona

This state charges 4.54% on any earnings of over $155,159.

• California

California levies 13.3% of tax on the income earned over $1 million. However, social security is excluded which is a relief.

• Connecticut

Here, 6.99% of tax is levied on the income of over $500,000.

• Idaho

Idaho is one of the highest-taxed states with 7.4% levied on an income of over $11,043.

• Kansas

Kansas levies a tax of 5.7% on an income of over $30,000.

• Massachusetts

This state has standard tax rate of 5.1% on all types of earnings.

• Minnesota

Minnesota levies a 9.85% on an income of over $160,020.

• Nebraska

Nebraska levies a tax of 6.84% on an income of over $30,420 and has no exemption for social security money.

Earning any income post-retirement is quite hard. And, expenses are always high. So, where you decide to settle could impact your financial well-being greatly. We would highly recommend you consider this state-wise senior tax breaks for retirees before deciding which option is the best for you.