Many spend years preparing for retirement, but it’s worth it when you enter your golden years with a nice nest egg. Some states exempt retirement income from taxes, like Arkansas, Illinois, Iowa, Mississippi, New Hampshire, Pennsylvania, and South Carolina. Living in a state with no income taxes means no taxes on Social Security and retirement account withdrawals.
Nine states do not have state income taxes, including Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming. 41 states and D.C. do not tax Social Security benefits. The remaining nine states that do include Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont, and West Virginia. Federal taxes may still apply.
Your combined income determines how much of your Social Security benefits are taxed federally. The percentage of taxable benefits added to income varies based on filing status and income level. An easy trick could boost your retirement income by maximizing Social Security benefits. View “Social Security secrets” to learn more.
Read more at Yahoo Finance: Here Are the States That Won’t Tax Your Social Security, 401(k), IRA, or Pension Income
