Which states tax Social Security benefits?

For those who owe taxes on their benefits, a state policy called the Social Security Subtraction offers a partial deduction. For the 2022 tax year, single filers can exclude up to $4,260 of their federally taxable benefits from their Minnesota income. The maximum subtraction for married couples is $5,450. The subtraction is phased out for those with higher incomes, starting at $82,770 for married joint filers and $64,670 for singles.

For more information, contact the Minnesota Department of Revenue.

Missouri

Social Security benefits are fully deductible for Missouri residents ages 62 and older with an AGI of less than $85,000 (single) or $100,000 (married, filing jointly). If you earn more, you may still be eligible for a partial deduction.

Missouri’s income-tax rates range from 0 percent to 5.3 percent. For more information, contact the Missouri Department of Revenue.

Montana

Like the federal government, Montana does not tax Social Security for people with overall incomes of less than $25,000 for a single filer and $32,000 for a couple filing jointly. Residents who make more are liable for tax on their benefits, but the state uses a different method than the feds to determine the taxable amount. The state tax form includes a worksheet for calculating the difference.

Montana’s income-tax rates range from 1 percent to 6.75 percent. The top rate will drop to 5.9 percent in the 2024 tax year. For more information, contact the Montana Department of Revenue.

Nebraska

Nebraska does not tax Social Security benefits for couples filing jointly with an AGI below $61,760 and for singles with an AGI below $45,790. Above those levels, a portion of Social Security income is taxable, but the share is set to decline annually as the state phases out taxation of benefits. 

A state law passed in April 2022 will eliminate taxation of Social Security income over the next few years. Under the measure, the taxable share of Nebraskans' benefits will drop in steps from 60 percent in the 2022 tax year to zero in 2025. 

Nebraska taxes income at rates of 2.46 percent to 6.84 percent. The top rate is set to decline over the next several years as part of the new tax law. For more information, contact the Nebraska Department of Revenue.

New Mexico

Legislation passed by state lawmakers in February 2022 and signed by Gov. Michelle Lujan Grisham the following month eliminated taxation of benefits for most New Mexicans. Starting with the 2022 tax year, Social Security income is fully deductible for residents with AGIs below $100,000 for an individual and $150,000 for a couple filing jointly. 

New Mexico taxes income at rates from 1.7 percent to 5.9 percent. For more information contact the New Mexico Taxation & Revenue Department.

Rhode Island

The state does not tax benefits for people who have reached full retirement age as defined by the Social Security Administration (between 66 and 67, depending on year of birth) and have an AGI below $95,800 if their filing status is single or head of household or $119,750 for a couple filing jointly.

Rhode Island taxes income at rates ranging from 3.75 percent to 5.99 percent. For more information, contact the Rhode Island Department of Revenue’s Division of Taxation.

Utah

Utah uses the federal formula to calculate how much Social Security income is taxable at the state tax rate, which is 4.85 percent (dropping to 4.65 percent in 2023), but the state offers a full or partial credit on those taxable benefits. 

Married couples filing jointly and heads of households reporting 2022 income of $62,000 or less, and singles making $37,000 or less, qualify for a full tax credit on their benefit income. Those earning more can still get a partial break on their benefits, with the tax credit reduced by 25 cents for each dollar above the income thresholds above. In 2023, the thresholds go up to $45,000 for an individual filer and $75,000 for couples and heads of households.

For more information, contact the Utah State Tax Commission.

Vermont

Vermont lawmakers voted in 2022 to raise the income threshold for exempting Social Security benefits from state taxes, effective this tax year. Single filers with an AGI of $50,000 or less now qualify for a full exemption from paying state taxes on their benefits. Those who make between $50,000 and $60,000 are eligible for a partial exemption. 

For married couples filing jointly, the full exemption applies at incomes of $65,000 or less. The exemption is phased out at incomes between $65,000 and $75,000.

For single filers earning $60,000 or more and couples making $75,000 or more, benefits are fully taxed at the state rate, which ranges from 3.35 percent to 8.75 percent. For more information, contact the Vermont Agency of Administration’s Department of Taxes.

West Virginia

West Virginia taxes Social Security income according to the federal model for residents with adjusted gross income above $50,000 for single taxpayers and $100,000 for couples filing jointly. Those with AGIs below those levels can fully deduct their benefits as of the 2022 tax year. 

West Virginia’s income-tax rates range from 3 percent to 6.5 percent. For more information, contact the West Virginia State Tax Department.

Keep in mind

None of the above applies to Supplemental Security Income, a monthly benefit for people who are 65-plus or have a disability or vision loss and have very low incomes and limited assets. SSI, which is administered by the Social Security Administration, is not subject to income taxes.