Best States for Retirees (Tax Friendliness)

States ranked by how favorably they tax retirement income. Scoring considers income tax rates, Social Security taxation, pension taxation, 401(k)/IRA taxation, and estate tax.

Rank ↕	State ↕	Income Tax ↕	SS Taxed ↕	Pensions ↕	401(k)/IRA ↕	Estate Tax ↕	Score ↕
1	Alaska	0%	NO	EXEMPT	NO	NO	10/10
2	Florida	0%	NO	EXEMPT	NO	NO	10/10
3	Nevada	0%	NO	EXEMPT	NO	NO	10/10
4	New Hampshire	0%	NO	EXEMPT	NO	NO	10/10
5	South Dakota	0%	NO	EXEMPT	NO	NO	10/10
6	Tennessee	0%	NO	EXEMPT	NO	NO	10/10
7	Texas	0%	NO	EXEMPT	NO	NO	10/10
8	Wyoming	0%	NO	EXEMPT	NO	NO	10/10
9	Washington	0%	NO	EXEMPT	NO	YES	9/10
10	Iowa	3.8%	NO	EXEMPT	NO	NO	8/10
11	Pennsylvania	3.07%	NO	EXEMPT	NO	NO	8/10
12	Mississippi	4.7%	NO	EXEMPT	NO	NO	7/10
13	Illinois	4.95%	NO	EXEMPT	NO	YES	6/10
14	Alabama	5%	NO	EXEMPT	YES	NO	5/10
15	Arizona	2.5%	NO	PARTIAL	YES	NO	5/10
16	Arkansas	3.9%	NO	PARTIAL	YES	NO	5/10
17	Kentucky	4%	NO	PARTIAL	YES	NO	5/10
18	Louisiana	4.25%	NO	EXEMPT	YES	NO	5/10
19	Ohio	3.5%	NO	PARTIAL	YES	NO	5/10
20	Colorado	4.4%	NO	PARTIAL	YES	NO	4/10
21	Delaware	6.6%	NO	PARTIAL	YES	NO	4/10
22	Georgia	5.39%	NO	PARTIAL	YES	NO	4/10
23	Indiana	3.05%	NO	FULLY TAXED	YES	NO	4/10
24	Kansas	5.7%	NO	PARTIAL	YES	NO	4/10
25	Michigan	4.25%	NO	PARTIAL	YES	NO	4/10
26	Missouri	4.7%	NO	PARTIAL	YES	NO	4/10
27	Montana	5.9%	NO	PARTIAL	YES	NO	4/10
28	New Mexico	5.9%	NO	PARTIAL	YES	NO	4/10
29	North Dakota	2.5%	NO	FULLY TAXED	YES	NO	4/10
30	Oklahoma	4.75%	NO	PARTIAL	YES	NO	4/10
31	South Carolina	6.2%	NO	PARTIAL	YES	NO	4/10
32	Virginia	5.75%	NO	PARTIAL	YES	NO	4/10
33	West Virginia	4.82%	NO	PARTIAL	YES	NO	4/10
34	Wisconsin	7.65%	NO	PARTIAL	YES	NO	4/10
35	California	13.3%	NO	FULLY TAXED	YES	NO	3/10
36	Hawaii	11%	NO	PARTIAL	YES	YES	3/10
37	Idaho	5.695%	NO	FULLY TAXED	YES	NO	3/10
38	Maine	7.15%	NO	PARTIAL	YES	YES	3/10
39	Maryland	5.75%	NO	PARTIAL	YES	YES	3/10
40	Massachusetts	5%	NO	PARTIAL	YES	YES	3/10
41	Nebraska	5.2%	NO	FULLY TAXED	YES	NO	3/10
42	New Jersey	10.75%	NO	PARTIAL	YES	YES	3/10
43	New York	10.9%	NO	PARTIAL	YES	YES	3/10
44	North Carolina	4.5%	NO	FULLY TAXED	YES	NO	3/10
45	District of Columbia	10.75%	NO	FULLY TAXED	YES	YES	2/10
46	Oregon	9.9%	NO	FULLY TAXED	YES	YES	2/10
47	Connecticut	6.99%	YES	PARTIAL	YES	YES	1/10
48	Utah	4.65%	YES	FULLY TAXED	YES	NO	1/10
49	Minnesota	9.85%	YES	FULLY TAXED	YES	YES	0/10
50	Rhode Island	5.99%	YES	FULLY TAXED	YES	YES	0/10
51	Vermont	8.75%	YES	FULLY TAXED	YES	YES	0/10

Scoring Methodology

Each state is scored out of 10 points based on: no income tax (+3) or low rate under 4% (+1); Social Security exempt (+2); pensions exempt (+2) or partially exempt (+1); 401(k)/IRA exempt (+2); no estate tax (+1).

Sources: Tax Foundation; Kiplinger; state revenue departments.