5 States That Don’t Tax Social Security Or Pensions

3. Iowa

Cost of Living Index: 89.2

The state of Iowa has exempted all social security income from taxes. Moreover, deductions are provided on other types of retirement incomes for the year 2022. These deductions will be filed in the next year. Residents in Iowa aged 55 or older are going to be exempt from retirement income state taxes for the tax year 2023 (filed in 2024). Property taxes are higher on average at 1.50%. Overall, the cost of living is 9% lower than the national average.