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10 countries that will tax social security benefits in 2024
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10 countries that will tax social security benefits in 2024

AJ_Watt / Getty Images

AJ_Watt / Getty Images

Although Social Security benefits are taxable at the federal level, most recipients have not had to worry about paying taxes on their benefits or state income taxes. That will remain the case in 2024, although residents in some states will have to pay state taxes on Social Security.

Read more: 9 Strategies Americans Use to Minimize the Taxes They Pay on Retirement Savings

Check out: Do you owe the IRS money? Most people don’t realize they should

These are the 10 states that will tax Social Security benefits in 2024: Colorado, Connecticut, Kansas, Minnesota, Montana, Nebraska, New Mexico, Rhode Island, Utah and Vermont.

Note that the taxes you must pay vary from state to state. The following states reduce Social Security contributions based on age or income:

Now trending:

  • Connecticut: Retirees whose annual adjusted gross income is more than $75,000 for single filings and $100,000 for joint filings can deduct most or all of their benefit income in Connecticut. Individuals earning more than these thresholds can still deduct 75% of Social Security benefits.

  • Kansas: If your AGI is $75,000 or less, you don’t have to pay state taxes on your benefits in Kansas, regardless of your tax status.

  • Montana: For many Montana retirees, Social Security is taxable. However, taxpayers who earn less than $25,000 per year ($32,000 if filing jointly) can deduct all of their Social Security retirement income. Starting in 2024, Social Security benefits will be taxed in Montana the same as they are at the federal level.

  • Nebraska. In the Cornhusker State, Social Security benefits are subject to a sliding scale based on AGI. Individuals with incomes below $59,100 (for a married couple) and $44,460 (for an individual) do not have to pay state tax on their benefits. The state will phase out state income tax on benefits by 2025.

  • New MexicoBeginning in 2023, New Mexico will phase out taxes on Social Security benefits for individuals earning less than $100,000 a year and for married couples filing jointly earning less than $150,000.

  • Rhode Island: You don’t have to pay Social Security taxes in Rhode Island if you’re of full retirement age and have an AGI of less than $86,350 (filing single/head of household) or $107,950 (filing jointly).

  • Vermont. Single filers with an AGI of $50,000 or less are fully exempt from paying state taxes on their benefits. They are eligible for a partial exemption between $50,000 and $60,000. Those filing jointly can get the full exemption for incomes of $65,000 or less and the partial exemption for incomes between $65,000 and $75,000.

  • Utah: The Beehive State recently implemented its income-based tax credit system to equalize Social Security benefits for single filers earning less than $30,000 a year and for filers filing jointly earning less than $50,000 a year. Those earning more than these thresholds can still receive a partial exemption from their benefits. The tax credit is reduced by 25 cents for every dollar above the income thresholds above.

Residents of other states will not have to worry about paying state income taxes on Social Security benefits in 2024.

Nine states do not impose any income tax at all:

  • Alaska

  • Florida

  • Nevada

  • New Hampshire

  • South Dakota

  • Tennessee

  • Texas

  • Washington

  • Wyoming

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This article originally appeared on GOBankingRates.com: 10 States That Will Tax Social Security Benefits in 2024

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