The State Worker

Retiring? Check out which states’ tax laws favor you

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Our Tuesday story on Las Vegas’ popularity with CalPERS retirees prompted several questions from readers, many asking for more information about which states don’t tax income or have income tax laws that give pensions a break.

Here’s the rundown, according to the National Conference of State Legislature’s April update on state income taxes on pensions and retirement income:

  • No personal income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming.
  • Only interest and dividends taxed as income: New Hampshire and Tennessee.
  • Broad-based income tax with no exclusions for pensions or retirement income: California, Nebraska, North Dakota, Rhode Island and Vermont.

The remaining states offer tax breaks for at least one of the following: pension income or other retirement income and elderly residents.

To really get into the details, here’s the NCSL’s analysis. The state-by-state summaries start at page 5.

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