5 Things Retirees Need to Know About Social Security and Taxes

2. Residency Impact: How Your State of Residence Affects Taxes

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Quite a few states that don’t tax social security, while there are yet others don’t tax retirement income at all. However, the retirees who live in states such as Connecticut, Kansas, Montana, Nebraska, and a few others, have a portion of their social security subject to state income taxes. Many of these states have different criteria from the federal government when taxing Social Security payments. They either have higher income thresholds, provide diverse deductions, or impose limitations on the taxation of benefits.