How Every State Taxes Retirement Income in 2026

Methodology and definitions

Every rule on this page comes from a primary source: an official state Department of Revenue or Taxation page, an official return instruction or form, enacted legislation or state code, or an IRS publication for a federal definition. We do not cite secondary summaries, and we do not carry a rule forward from one year to the next without checking it.

Where we could not locate an official source for a given tax year, the row is labelled manual review or prior-year proxy and the dollar estimate is switched off in the calculation engine itself. An honest gap is more useful than a confident guess, and this dataset is designed to be audited line by line.

Social Security benefits

Gross SSA benefits. States decide independently of the IRS how much to include.

Traditional IRA / 401(k) / 403(b) distributions

Taxable withdrawals from pre-tax IRAs, 401(k)s, and 403(b)s, including RMDs.

Private employer pension

Defined-benefit payments from a private-sector employer.

State or local government pension

Payments from a state, county, municipal, or school-district system.

Federal civil-service pension (CSRS/FERS)

CSRS and FERS annuities. States generally may not tax these more harshly than their own pensions.

Military retirement pay

Retired pay from the uniformed services, often exempted separately.

Why Social Security, pensions, and IRA withdrawals are treated differently

Almost every state income tax begins with a federal number — usually federal adjusted gross income. From there, each legislature writes its own list of subtractions. Social Security typically gets its own subtraction line, because exempting benefits is politically straightforward and the revenue cost is predictable. Pension exclusions came later and are usually capped, age-gated, or income-tested, because uncapped pension relief is expensive.

Traditional IRA and 401(k) withdrawals are the least protected category. They were never part of the older public-pension bargain, they are discretionary in timing, and they scale with wealth — so states that generously exempt Social Security often still tax every dollar you pull out of a 401(k).

Government pensions carry a constitutional wrinkle. Under the doctrine confirmed in Davis v. Michigan Department of Treasury, a state may not tax federal civil-service pensions more heavily than it taxes its own state and local pensions. That is why the federal and state-local pension columns move together in most states, and why we track them separately rather than assuming they match.