Bold truth: most retirees don’t pay federal taxes on Social Security, but a surprising handful of states still tax those benefits. Here’s a clear, beginner-friendly guide to who taxes Social Security earnings and how you can optimize your dollars.
Feb. 15, 2026, 8:01 a.m. ET
Social Security benefits can be a meaningful boost to many Americans’ finances. Yet for some households, those extra dollars push income high enough to trigger taxes on Social Security at the state level, even when the federal government already taxes certain Social Security earnings for retirees, survivors, and disability recipients. A few states continued to tax these benefits for 2025, though a couple have stopped or phased out the tax for 2026. Below is a state-by-state snapshot and practical tips to help you make the most of your benefits.
Will your state tax Social Security earnings?
Nine states taxed Social Security earnings for the 2025 tax year:
- Colorado: If you’re under 65, the first $20,000 of Social Security benefits isn’t taxable at the state level. If you’re 65 or older, none of your Social Security earnings are taxed. A 2025 change allows 55–64-year-olds to claim a full deduction up to $24,000.
- Connecticut: If your adjusted gross income (AGI) is under $75,000 for single filers or under $100,000 for married couples filing jointly, Social Security benefits aren’t taxed. If you exceed these thresholds, up to 25% of your benefits may be taxed.
- Minnesota: Social Security benefits are fully or partially exempt from Minnesota income tax. The exemption phases out starting at $108,320 (married filing jointly) or $84,490 (single).
- Montana: The amount of tax you pay on Social Security benefits depends on your AGI.
- New Mexico: Most Social Security recipients aren’t taxed on their benefits. Exemption amounts: single filers under $100,000; married filing jointly under $150,000; married filing separately under $75,000.
- Rhode Island: If your income exceeds $107,000 (single) or $133,750 (joint), or if you’re younger than the state’s full retirement age, you don’t get a tax break.
- Utah: Benefits are taxed if your income is $54,000+ (single), $90,000+ (head of household or joint), or $45,000 (married filing separately). If you’re below these thresholds, you might qualify for a nonrefundable credit for benefits.
- Vermont: Single filers with AGI under $50,000 and joint filers under $65,000 don’t pay state tax on benefits. The exemption narrows or phases out as income rises beyond those levels.
- West Virginia: 2025 brought expanded exemptions, allowing up to 65% of Social Security benefits included in federal AGI to be subtracted for taxable years beginning on or after Jan 1, 2025.
Is there a way to minimize or avoid Social Security taxes?
Social Security benefits can significantly ease the cost of living, but state taxes can complicate budgets. A few practical approaches help many retirees minimize taxes:
- Check your state’s rules: Some states don’t tax Social Security at all, meaning you won’t face state-level tax on those benefits. If your state does tax, learn the AGI threshold or income cutoffs that determine whether benefits are taxed.
- Compare your AGI with state thresholds: If your income falls under the state’s threshold, you may avoid paying state tax on Social Security.
- Time your benefits strategically: If you can, delaying Social Security to maximize benefits may also help reduce taxation in some situations, depending on your overall income profile.
What is an SSA-1099 form and how do you get it?
To determine how much you received in benefits during the year, the Social Security Administration mails or electronically provides a form in January. This document, known as the SSA-1099, is your Social Security Benefit Statement and helps you calculate your taxes when filing your federal return.
Key takeaways for planning:
- Start by identifying whether your state taxes Social Security and, if so, where you fall in its income thresholds.
- If you’re near a threshold, you may be able to reduce or avoid state taxes by adjusting other income or timing distributions.
- Keep your SSA-1099 handy for year-end tax planning and accurate reporting to the federal government.
Contributors: Medora Lee, Andrea Riquier
