5 States that Don’t Tax Pensions AND Social Security

Below you can see our list of the 5 states that don’t tax pensions and social security. For a more comprehensive list please see this article.

5. Mississippi

Mississsippi is an excellent state for retirees, and thus a part of the states that don’t tax pensions and social security, as long as you retire at the appropriate time (at the age of 59) and not earlier, as Mississippi then does not tax either pension, whether private or public, or social security.

4. South Dakota

South Dakota is another state in the US which has no state tax on income, thereby exempting both pension and social security from tax.

3. Tennessee

For now, residents of Tennessee are only required to pay taxes on their income from dividends and interest; pension and social security is exempt. In 2021, even these incomes will not be taxable.

2. Texas

One of the biggest states in the US by both land mass and population, Texas does not have a state income tax, thereby exempting both pension and social security.

1. Wyoming

Topping the list of 14 states that don’t tax pensions and social security is a state often called the best state in the US for retirees, with no income tax. It further also does not have any taxes on the 401k, which means any income you receive after retirement is yours to do whatever you feel like.

See also 18 countries with the lowest tax rates in the world and 16 easiest tax deductions and credits to claim on your return.