Eight states still tax Social Security benefits in 2026: Colorado, Kansas, Minnesota, Montana, New Mexico, Rhode Island, Utah, and Vermont. That is down from ten just two years ago, and every state on the current list offers an income-based exemption that keeps most lower- and middle-income retirees from owing anything. Whether you actually pay depends on where you live, your total income, and whether you clear your state’s exemption threshold.
The Eight States and How Each One Treats Social Security
The rules vary a lot. Some states use a flat income cutoff, some phase the exemption out, and one uses a credit instead of a deduction. Thresholds are adjusted periodically, so confirm the current year’s numbers with your state revenue department before filing.
Colorado
Retirees age 65 and older can subtract the full amount of Social Security benefits included in their federal taxable income. Those under 65 who receive benefits (disability recipients, early retirees) can subtract up to $20,000. Most Colorado retirees end up paying nothing.
Kansas
Kansas fully exempts Social Security benefits when your federal adjusted gross income is $75,000 or less, regardless of filing status. Above that line, benefits are taxed the same way they are on your federal return.
Minnesota
Minnesota taxes Social Security more broadly than most states on the list but offers an exemption indexed to income and adjusted annually for inflation. In recent tax years, married filers age 65 and older have been fully exempt with AGI below roughly $130,000, and single and head-of-household filers below roughly $105,000. The exemption phases out as income climbs. Retirees with significant pension or investment income on top of Social Security are the ones most likely to owe.
Montana
Montana still includes Social Security in taxable income for higher-income retirees. The state’s tax code was simplified in recent years and the specifics have been in flux, so Montana residents should confirm current thresholds and deductions with the Department of Revenue.
New Mexico
New Mexico exempts Social Security for single filers with income under $100,000 and for joint filers, heads of household, and surviving spouses with income under $150,000. Above those levels, benefits become partially taxable. The thresholds are generous enough that most New Mexico retirees fall under them.
Rhode Island
Rhode Island fully exempts Social Security for taxpayers who have reached full retirement age and whose federal AGI falls below an inflation-adjusted threshold. In recent tax years that threshold has been around $104,200. The full-retirement-age requirement matters: early retirees who have not yet reached 66 or 67 (depending on birth year) do not qualify, no matter their income.
Utah
Utah uses a tax credit rather than an exemption or subtraction. The credit offsets state tax on Social Security income and phases out as income rises. A 2025 bill proposed removing the income limitations entirely, which would effectively eliminate the tax for all Utah retirees. Confirm with the Utah State Tax Commission whether that change applies for the 2026 tax year.
Vermont
Vermont provides a full exemption for single, head-of-household, and other non-joint filers with AGI up to $55,000. The exemption phases out between $55,000 and $65,000 and disappears entirely at $65,000. Joint filers face higher thresholds. Only relatively high-income Vermont retirees end up paying.
States That Recently Stopped Taxing Social Security
If you are reading an older guide that lists ten or even thirteen states, it is out of date. Two states completed their phase-outs effective for the 2026 tax year:
- Connecticut phased in an increasing deduction over several years, reaching 75% for 2025 and a full 100% deduction starting in 2026. Connecticut retirees owe no state tax on Social Security on their 2026 returns, regardless of income.
- West Virginia followed a similar schedule, moving from a 65% decreasing modification for 2025 to a 100% modification for 2026. Social Security no longer enters West Virginia taxable income at all.
Missouri and Nebraska both completed their own transitions to full exemption at the start of 2024.
States With No Income Tax
Nine states impose no personal income tax, so Social Security and every other kind of income goes untaxed at the state level: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. If you live in any of them, state-level Social Security taxation is not something you need to think about.
How State Taxation Connects to Federal Taxation
Most states that tax Social Security piggyback on the federal calculation, so a quick look at the federal baseline helps. The federal government taxes up to 85% of your benefits based on your “combined income,” defined as your adjusted gross income plus any tax-exempt interest plus half of your Social Security benefits. Single filers hit the first tier at $25,000 of combined income and the second at $34,000; joint filers hit them at $32,000 and $44,000. These thresholds were set in 1983 and 1993 and have never been indexed to inflation, which is why more retirees owe federal tax on their benefits every year.1Congress.gov. Social Security Benefit Taxation Highlights
The “up to 85%” figure is the share of benefits subject to tax, not the tax rate. Your actual rate depends on your overall bracket. Below $25,000 (single) or $32,000 (joint) in combined income, none of your Social Security is federally taxable, and you almost certainly won’t owe state tax either.
How to Figure Out What You Actually Owe
If you live in one of the eight taxing states, start with your Social Security Benefit Statement, Form SSA-1099. The Social Security Administration mails this every January, and you can also download it through your my Social Security account.2Social Security Administration. Get Tax Form (1099/1042S) Box 5 shows the total benefits paid during the year. That is the starting figure for both federal and state calculations.
Complete your federal return next. Line 6b on Form 1040 shows the taxable portion of your benefits after the federal combined-income formula is applied. Most states that tax Social Security use line 6b, your federal AGI, or both as the starting point for their own worksheet. You are not calculating state tax from scratch; you are adjusting what the IRS already determined.
Your state’s income tax instruction booklet includes a specific worksheet for Social Security. That is where the exemption threshold does its work. If your AGI falls below the cutoff, the worksheet zeros out the taxable amount. If not, it tells you how much of your benefits carry through to state taxable income. Many retirees find they owe something federally but nothing to their state, because state thresholds tend to be far more generous than the federal ones.
The List Will Probably Keep Shrinking
Legislative proposals to reduce or eliminate Social Security taxation surface regularly in Utah, Minnesota, and several other states still on the list. If you are planning a retirement move or trying to forecast your tax burden a few years out, check whether your state has pending legislation that could change the picture before you commit to any assumptions. Your state legislature’s website or revenue department will have the current status.