States That Don’t Tax Pensions

A pension is a type of fund that an employee makes payments toward, from a portion of their earned income, while being employed by that particular company they’re working for. In short, a pension fund is a way for people to save money so that after they retire, they’ll have a sum of money to live on. 

After retirement, a person’s pension will pay them out a predetermined allotment of money every month until that person dies. The quantity of money that accrues in your pension is determined by a few factors, such how many years you worked and how high your salary was during those years. Generally speaking, the longer a person works and the higher they’re paid, the larger their pension will be when they eventually retire. 

Depending on which state a person lives in, their pension might or might not be taxed to varying degrees. A little more than half of the states within the U.S. tax at least some of their constituent’s pensions. Often, however, states that only partially tax a person’s pension have limits in place regarding how much of the pension can be taxed. As an example, the state of Iowa lets joint filers who are older than 55 years of age exclude $12,000 from being taxed. 

Learn more about states that don’t tax pensions by browsing the data in the charts.

Pensions Tax Status by State

Alabama - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

INCOME TAX PER STATEhelp

2%

#18 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Alaska - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Arizona - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

2.59%

#19 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Arkansas - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

2%

#20 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

California - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1%

#8 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Fully Tax

Colorado - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

4.55%

#32 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Connecticut - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

3%

#24 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

No tax

Delaware - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

0%

#1 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Florida - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Georgia - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1%

#9 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Hawaii - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

INCOME TAX PER STATEhelp

1.4%

#10 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Idaho - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1.13%

#11 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Illinois - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

INCOME TAX PER STATEhelp

4.95%

#34 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Indiana - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

3.23%

#25 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Iowa - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

0.33%

#2 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Kansas - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

3.1%

#26 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

No tax

Kentucky - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

5%

#40 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Louisiana - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1.85%

#12 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Maine - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

5.8%

#41 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Maryland - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

2%

#21 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Massachusetts - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

5%

#42 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Michigan - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

4.25%

#35 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Minnesota - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

5.35%

#43 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

No tax

Mississippi - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

INCOME TAX PER STATEhelp

0%

#3 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Missouri - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1.5%

#13 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Montana - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1%

#14 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Nebraska - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

2.46%

#22 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

No tax

Nevada - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

New Hampshire - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

New Jersey - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1.4%

#15 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

New Mexico - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1.7%

#16 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

New York - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

4%

#36 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

North Carolina - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

4.99%

#37 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

North Dakota - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

1.1%

#17 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

No tax

Ohio - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

0%

#4 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Oklahoma - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

0.25%

#5 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Oregon - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

4.75%

#38 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

Pennsylvania - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

INCOME TAX PER STATEhelp

3.07%

#27 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Rhode Island - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

3.75%

#28 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

South Carolina - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

0%

#6 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Partial Exemptions

South Dakota - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Tennessee - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Texas - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Utah - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

4.95%

#39 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

No tax

Vermont - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

3.35%

#29 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

Fully Tax

Virginia - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

2%

#23 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

Fully Tax

Washington - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

West Virginia - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

3%

#30 in the US

SOCIAL SECURITY TAX STATUShelp

Yes

MILITARY RETIREMENT TAX STATUShelp

No tax

Wisconsin - Pensions Tax Status

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PENSIONS TAX STATUShelp

Yes

INCOME TAX PER STATEhelp

3.54%

#31 in the US

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax

Wyoming - Pensions Tax Status

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PENSIONS TAX STATUShelp

No

SOCIAL SECURITY TAX STATUShelp

No

MILITARY RETIREMENT TAX STATUShelp

No tax