State Retirement Income Tax Calculator (2026)
Your state's treatment of IRA withdrawals, Social Security, and pension income varies enormously — from zero tax in 14 states to over 13% in California. This calculator estimates your annual state income tax on retirement income in any of all 50 states and compares your current state to an alternative. Data current for 2026, including changes for New Hampshire, West Virginia, Iowa, Michigan, and several others.
Why the state tax layer matters in retirement
Most retirement tax modeling stops at the federal level — bracket management, Roth conversions, IRMAA avoidance. The state layer sitting on top is often left unmodeled, which can be a costly omission.
A married couple drawing $80,000/year from a traditional IRA in California faces an effective state tax of roughly $5,700–$7,000/year — before federal tax, before Medicare premiums. The same withdrawal in Illinois: zero state tax. Not because Illinois has no income tax (it does, at 4.95%), but because Illinois fully exempts all retirement income including IRA and 401(k) distributions.
Over a 25-year retirement, that's a $140,000–$175,000 gap — and that's just on the state line item.1
The 2026 state retirement tax landscape
| Tier | Description | States |
|---|---|---|
| No tax | No state income tax of any kind | AK, FL, NV, NH, SD, TN, TX, WA, WY |
| Retirement exempt | Has income tax but exempts most retirement income | IL, PA, IA (55+), MS (59½+), MI (up to $67.6K/person) |
| Partial exemption | Partial exemptions — SS, capped amounts, or age-based | NY, GA, CO, KY, MD, DE, NJ, OK, SC, VA, ME, and others |
| Fully taxed | IRA/pension taxed at standard income tax rates | CA (up to 13.3%), OR (9.9%), MN (9.85%), NY, NJ, WI, and others |
For a full narrative breakdown of each state's rules, see the State Income Taxes on Retirement Income guide.
2026 rule changes you need to know
- New Hampshire: Interest & Dividends Tax repealed January 1, 2025. NH is now a full no-income-tax state in 2026 — IRA withdrawals, pensions, dividends, and interest all untaxed.2
- West Virginia: Completed phase-out of Social Security taxation effective January 1, 2026. SS benefits are now fully exempt in WV.
- Michigan: In 2026, IRA and pension distributions are exempt up to $67,610 per person ($135,220 per couple), regardless of birth year. This makes Michigan effectively a Tier 2 state for most retirees at moderate income levels.
- Iowa: Flat rate fell to 3.8%, but all retirement income (IRA, pension, SS) remains fully exempt for Iowans age 55 and older.
Is your state costing you more than it should?
A retirement income specialist can model the full state tax picture alongside your Roth conversion window, IRMAA exposure, and withdrawal sequencing — and show you the lifetime cost of staying vs. moving before you make the decision.
Frequently asked questions
Which states have no income tax on retirement income in 2026?
Nine states have no income tax at all: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. Five more fully exempt most retirement income despite having income tax on wages: Illinois (4.95%), Pennsylvania (3.07%), Iowa (3.8%, age 55+), Mississippi (4%, age 59½+), and Michigan (4.25%, with a per-person exemption up to $67,610 in 2026). That's 14 states with zero or near-zero state tax on typical retirement income.
Does Social Security get taxed at the state level?
42 states plus D.C. fully exempt Social Security from state income tax in 2026. The 8 that still tax SS are Colorado, Connecticut, Kansas, Minnesota, Montana, New Mexico, Rhode Island, Utah, and Vermont — though most of these offer income-based exemptions that eliminate the tax for moderate-income retirees. West Virginia joined the full-exemption list as of January 1, 2026. Federal SS taxation (up to 85% via the provisional income formula) still applies everywhere regardless of state.
Are IRA withdrawals taxed differently than pension income by states?
Yes, and the differences can be significant. Alabama fully exempts most pensions but taxes IRA distributions at up to 5%. Hawaii exempts government pensions but taxes private IRA withdrawals at up to 11%. New Jersey offers up to a $75,000 pension exclusion but treats IRA distributions as fully taxable ordinary income above that threshold. Pennsylvania exempts both pensions and IRA distributions age 59½+. Always check IRA and pension treatment separately when evaluating states.
Should I move states to reduce retirement taxes?
The income tax savings are often real — but rarely the whole picture. Moving from California to Florida on $80K/year of IRA income can eliminate $6,000–$7,400/year in state tax. However, Florida and Texas have significantly higher property taxes, which can offset a substantial portion of those savings on higher-value homes. California's Prop 13 often means long-held homes there carry lower property taxes than comparable homes in Texas. A complete analysis requires modeling income tax savings, property tax difference, estate tax exposure, and cost of living — alongside the non-financial factors that define 20–30 years of retirement.
What if I live in two states (snowbird situation)?
Tax residency is determined by your domicile state — the state you intend as your permanent home. Spending six months in Florida doesn't automatically make you a Florida resident for tax purposes. To establish domicile in a new state, you typically need to register to vote there, update your driver's license, change your primary bank relationships, and spend more than 183 days there. Many states with high income taxes (New York, California) are aggressive about auditing part-year and dual-residence claims. A CPA familiar with state domicile rules is essential before claiming residency in a no-tax state.
- Tax Foundation. "State Individual Income Tax Rates and Brackets, 2026." Rates for California (13.3% top), Oregon (9.9%), Minnesota (9.85%), New York (10.9%), and other graduated states. taxfoundation.org. Also: Kiplinger. "Best States to Retire." kiplinger.com.
- New Hampshire HB 2 (2023 session). Interest & Dividends Tax phased down from 4% (2023) → 3% (2024) → 0% (January 1, 2025). New Hampshire Department of Revenue Administration confirmed no I&D tax applies to tax year 2025 or later. revenue.nh.gov.
- Michigan Department of Treasury. "Retirement and Pension Benefits." 2026: Unconditional deduction of $67,610 (single) / $135,220 (joint) for pension and retirement income, regardless of birth year. Any retirement income above the deduction taxed at 4.25% flat rate. michigan.gov/taxes.
- Iowa Department of Revenue. "Retirement Income Tax Exclusion." Effective January 1, 2023: all retirement income — including IRA distributions, 401(k) distributions, pension payments, and Social Security — is excluded from Iowa income tax for taxpayers age 55 and older. Iowa flat rate reduced to 3.8% in 2026 on other income. tax.iowa.gov.
This calculator uses simplified effective rates and may not capture every state's bracket structure, local surtaxes, or income-specific credits. Results are estimates for planning purposes only — not tax advice. Consult a CPA or tax professional for your specific situation. State tax law can change; verify with your state's department of revenue for the current year.