This article takes a look at the top 10 tax-friendly states for retirees in 2024. If you wish to check out our detailed analysis, you may go to Top 26 Tax Friendly States for Retirees in 2024.
10. Virginia
Insider Monkey Score: 40
Tax Friendliness: Tax Friendly
Average Combined State Sales Tax Rate: 5.771%
Average Effective Property Tax Rate: 0.76%
Cost of Living Index: 101.9
In the state of Virginia, your Social Security benefits aren’t going to be taxed. Other types of retirement income, such as pension income and retirement account withdrawals, are deductible up to $12,000 for seniors.
9. Georgia
Insider Monkey Score: 41
Tax Friendliness: Very Tax Friendly
Average Combined State Sales Tax Rate: 7.384%
Average Effective Property Tax Rate: 0.83%
Cost of Living Index: 90.8
In the state of Georgia, Social Security retirement benefits aren’t taxed, while there is a maximum deduction of $65,000 per person on all types of retirement income for anyone 65 or older.
8. Idaho
Insider Monkey Score: 43
Tax Friendliness: Tax Friendly
Average Combined State Sales Tax Rate: 6.026%
Average Effective Property Tax Rate: 0.56%
Cost of Living Index: 98.6
The state of Idaho doesn’t tax Social Security. Other forms of retirement income, such as from a 401(k) or an IRA, are taxed at the state’s normal income tax levels.
7. Florida
Insider Monkey Score: 44
Tax Friendliness: Very Tax Friendly
Average Combined State Sales Tax Rate: 7.002%
Average Effective Property Tax Rate: 0.82%
Cost of Living Index: 100.7
The Sunshine State of Florida doesn’t have an income tax. No retirement income is taxed at the state level.
6. South Dakota
Insider Monkey Score: 46
Tax Friendliness: Very Tax Friendly
Average Combined State Sales Tax Rate: 6.111%
Average Effective Property Tax Rate: 1.14%
Cost of Living Index: 92.4
Like Florida, South Dakota doesn’t have an income tax either. The state also boasts a cost of living that is lower than the national average.
5. Mississippi
Insider Monkey Score: 46
Tax Friendliness: Very Tax Friendly
Average Combined State Sales Tax Rate: 7.062%
Average Effective Property Tax Rate: 0.76%
Cost of Living Index: 86.3
The state of Mississippi exempts all forms of retirement income from taxation, including Social Security benefits, income from an IRA, income from a 401(k), and any pension income.
4. Delaware
Insider Monkey Score: 50
Tax Friendliness: Tax Friendly
Average Combined State Sales Tax Rate: 0.000%
Average Effective Property Tax Rate: 0.55%
Cost of Living Index: 101.1
In Delaware, SS benefits aren’t taxed. There is no sales tax either, and property tax is low.
3. Alaska
Insider Monkey Score: 51
Tax Friendliness: Very Tax Friendly
Average Combined State Sales Tax Rate: 1.821%
Average Effective Property Tax Rate: 1.16%
Cost of Living Index: 125.2
There is no state income tax in Alaska either. There is no sales tax as well. However, the average local sales tax rate is 1.821%.
2. Nevada
Insider Monkey Score: 53
Tax Friendliness: Very Tax Friendly
Average Combined State Sales Tax Rate: 8.236%
Average Effective Property Tax Rate: 0.50%
Cost of Living Index: 101
There is no state income tax in Nevada. Property taxes are low, but sales taxes are higher.
1. Wyoming
Insider Monkey Score: 62
Tax Friendliness: Very Tax Friendly
Average Combined State Sales Tax Rate: 5.441%
Average Effective Property Tax Rate: 0.58%
Cost of Living Index: 92.4
The top tax-friendly state for retirees in 2024 is Wyoming. There is no state income tax in the state, and property and sales taxes are some of the lowest in the country.
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