State Retirement Income Tax Calculator 2026

Federal income tax on RMDs gets most of the attention — but state income tax can add thousands more. A retiree taking $80,000/year in RMDs in Florida owes $0 to the state. The same retiree in California may owe $5,000–$7,000. Enter your retirement income below to see your estimated state tax and compare it against every other state.

Why state tax is a major retirement planning variable

For a retiree with $1.5M in a traditional IRA, annual RMDs at age 75 are approximately $61,000. Add $35,000 in Social Security and the total retirement income is $96,000. In California, that income generates roughly $5,000–$8,000 in state income tax (after California's limited $5,202 standard deduction). In Florida, Texas, Nevada, or Pennsylvania, the state tax is $0. Over a 20-year retirement, the difference compounds to $100,000–$160,000 in cumulative tax — before accounting for any growth on retained amounts.

State tax planning for retirees is not just about relocation. Even staying in a high-tax state, the right strategy can reduce the bill materially: maximizing QCDs to reduce IRA income, timing pension elections, and understanding whether your state's exclusion is per-person or shared all affect annual tax.

The 9 zero-tax states

Nine states impose no personal income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.¹ In all nine, your RMDs, Social Security, pension income, and Roth conversions are completely free from state income tax. New Hampshire eliminated its investment income tax (Interest and Dividends Tax) effective January 1, 2025, bringing it fully into the zero-tax category. Tennessee's Hall Tax was eliminated in 2022.

The caveat: zero income tax doesn't mean zero total tax burden. Texas and Washington have relatively high property and sales taxes. Alaska has no sales tax at the state level but high local taxes in some areas. Florida has no estate tax but higher insurance costs. Run a full cost-of-living comparison, not just the income tax line.

States that fully exempt retirement income

Four states levy a general income tax but specifically exempt all qualified retirement income from taxation — including IRA distributions, 401(k) withdrawals, pensions, and Social Security:

• Illinois (4.95% flat): Full exemption for all retirement income. A retiree taking $150,000 in RMDs owes $0 to Illinois.²
• Iowa (3.8% flat): Full exemption for retirement income including IRA/401(k) distributions for taxpayers age 55 and older.²
• Mississippi (up to 4.7%): Full exemption for qualified retirement income including IRA and pension distributions.²
• Pennsylvania (3.07% flat): No state tax on distributions from IRAs, 401(k)s, or qualified pension plans after reaching retirement age.²

States with large partial exemptions

Georgia — $65,000 per person at age 65+

Georgia allows a retirement income exclusion of $65,000 per person for taxpayers age 65 and older — $130,000 for a married couple both over 65. Social Security is fully exempt. Georgia's flat income tax rate is 4.99% in 2026.³ For most retirees with moderate RMDs, the exclusion shelters all or most of their IRA income.

Michigan — up to $128,080 deduction for couples age 67+

Michigan completed its 4-year phase-in of a full retirement income deduction in 2026. For taxpayers born after 1952 and age 67 or older, Michigan allows: (1) a $64,040 single / $128,080 joint retirement income deduction; (2) a separate Social Security deduction; and (3) a standard deduction of $20,000 single / $40,000 joint — all stackable under 2026 rules (Public Act 24 of 2025).⁴ Michigan's flat income tax rate is 4.25%. For most couples with income below $250,000, the combined deductions reduce state tax to near zero.

New York — $30,000 per person exclusion (2026)

New York excludes up to $30,000 per person of qualifying pension and IRA income for taxpayers age 59½ and older in 2026 — increased from $20,000 in 2025 as part of a phased increase toward $40,000 in 2028.⁵ Social Security is fully exempt. Above the exclusion, New York's progressive rates range from 4% to 10.9%. For a single retiree with $100,000 in RMDs, $30,000 is sheltered and $70,000 is taxable at roughly 5.85% — about $4,000 in state tax.

New Jersey — up to $100,000 exclusion (joint) if income ≤ $150,000

New Jersey offers a retirement income exclusion of up to $75,000 (single) or $100,000 (married filing jointly) for taxpayers age 62 and older with New Jersey gross income of $150,000 or less.⁶ Social Security is fully exempt. The exclusion phases out between $100,000 and $150,000 of income. Above $150,000, no exclusion is available — all retirement income is taxed at New Jersey's rates (1.4% to 10.75%).

Colorado — $24,000 deduction at age 75+

Colorado allows taxpayers age 75 and older to deduct up to $24,000 of retirement income (including Social Security, pension, and IRA distributions). The deduction is $20,000 for ages 65–74. Colorado's flat income tax rate is 4.40% in 2026. For both spouses, the deduction applies per person. After the deduction, most retirees with RMDs under $60,000–$70,000 owe little Colorado state tax.

High-tax states for retirees

Several states fully tax IRA distributions and pension income at high progressive rates:

• California (1%–13.3%): Social Security is exempt, but all IRA, 401(k), and pension income is taxed at California's progressive rates. California's standard deduction is only $5,202 single / $10,404 MFJ — far lower than the federal standard deduction. A retiree with $80,000 in RMDs and no other income owes roughly $5,400 to California after the small standard deduction.
• Minnesota (5.35%–9.85%): Taxes most retirement income including IRA and pension distributions. Social Security is taxed in Minnesota above certain income thresholds. Minnesota follows the federal standard deduction.
• Oregon (4.75%–9.9%): Social Security is exempt; IRA and pension distributions are fully taxable. Oregon's standard deduction is low (~$2,745 single). An $80,000 RMD generates roughly $5,600–$7,000 in Oregon state tax.

Planning strategies for high-tax state residents

1. Maximize QCDs first. At $111,000/year (2026 limit), QCDs reduce your federal and state taxable income dollar for dollar. In California, each $10,000 QCD saves roughly $750–$930 in state tax on top of the federal savings.
2. Understand your state's exclusion cliff. In New Jersey, income just under $150,000 qualifies for a large exclusion; $1 over eliminates it. Roth conversions, QCDs, and IRMAA planning all interact with state exclusion thresholds.
3. Pre-RMD Roth conversions reduce future state exposure. Converting IRA balances to Roth before age 73 permanently reduces future RMDs — and future state taxable income. A $50,000/year Roth conversion in a moderate-income year is taxable; future Roth distributions are not.
4. Consult a specialist before relocating. Moving to a zero-tax state is a major life and financial decision. The tax savings are real, but domicile requirements, estate planning implications, and cost-of-living differences all matter. An advisor can model the full picture.

Sources

1. Kiplinger — States That Won't Tax Your Retirement Income in 2026. Lists all 9 states with no personal income tax (AK, FL, NV, NH, SD, TN, TX, WA, WY) and notes New Hampshire's full income tax phase-out effective January 1, 2025. Verified June 2026.
2. Tax Foundation — 2026 State Income Tax Rates and Brackets. Comprehensive 2026 state income tax rate reference including flat rates for IL (4.95%), IA (3.8%), MS (4.7%), PA (3.07%), and all other states. Published January 2026.
3. Georgia Department of Revenue — Retirement Income Exclusion. $65,000 per-person exclusion for age 65+; $35,000 for age 62–64. Social Security fully exempt. Georgia flat income tax rate: 4.99% for 2026.
4. Michigan Department of Treasury — Revenue Administrative Bulletin 2026-1. Retirement income deduction cap: $64,040 (single) / $128,080 (joint) for tax year 2026. Standard deduction $20,000 single / $40,000 joint; stackable with SS deduction under P.A. 24 of 2025.
5. American Tax Service — New York Retirement Deductions 2026. NY pension and annuity exclusion increases to $30,000 per person for 2026 (from $20,000 in 2025), with scheduled increases to $35,000 in 2027 and $40,000 in 2028. Social Security fully exempt. Applies to IRA, 401(k), 403(b), and qualified pension income for taxpayers age 59½ and older.
6. New Jersey Division of Taxation — Retirement Income Exclusions. Exclusion of up to $75,000 (single) or $100,000 (joint) for pension, IRA, and 401(k) income for taxpayers age 62 and older with NJ gross income ≤ $150,000. Phase-out applies $100,001–$150,000. Social Security fully exempt in New Jersey.

Calculator tax values verified against state revenue department sources and Tax Foundation 2026 data. State income tax rules change annually — confirm current-year values with a qualified tax advisor before making relocation or income decisions. This calculator provides estimates only and does not account for itemized deductions, tax credits, local/county taxes, or income beyond the three retirement sources above.