There are certain aspects of Social Security that tend to catch seniors off-guard. For one thing, some recipients wind up surprised at how little income they receive from Social Security. Others, meanwhile, are often shocked to learn that Social Security benefits can, in many cases, be subject to taxes.

Whether your benefits will be subject to federal taxes will depend on what your total retirement income looks like. Generally, if Social Security is your only source of retirement income, you'll avoid paying taxes on it.

But federal taxes aren't the only thing you'll need to worry about once you start collecting Social Security. Depending on where you retire, you may be subject to state taxes on your benefits as well.

Map of United States

Image source: Getty Images.

Most states don't tax Social Security

The good news is that right now, there are only 13 states that impose their own tax on Social Security benefits:

  1. Colorado
  2. Connecticut
  3. Kansas
  4. Minnesota
  5. Missouri
  6. Montana
  7. Nebraska
  8. New Mexico
  9. North Dakota
  10. Rhode Island
  11. Utah
  12. Vermont
  13. West Virginia

This means that in these 37 states, those taxes do not apply:

  1. Alabama
  2. Alaska
  3. Arizona
  4. Arkansas
  5. California
  6. Delaware
  7. Florida
  8. Georgia
  9. Hawaii
  10. Idaho
  11. Illinois
  12. Indiana
  13. Iowa
  14. Kentucky
  15. Louisiana
  16. Maine
  17. Maryland
  18. Massachusetts
  19. Michigan
  20. Mississippi
  21. Nevada
  22. New Hampshire
  23. New Jersey
  24. New York
  25. North Carolina
  26. Ohio
  27. Oklahoma
  28. Oregon
  29. Pennsylvania
  30. South Carolina
  31. South Dakota
  32. Tennessee
  33. Texas
  34. Virginia
  35. Washington
  36. Wisconsin
  37. Wyoming

Another thing worth noting is that come next year, West Virginia will stop taxing benefits for residents making less than an established amount. 

Should you retire to a state that doesn't tax benefits?

Avoiding taxes on your Social Security income may be important to you, especially if you expect those benefits to constitute your primary income stream. But before you make a point to avoid those 13 (soon to be 12) states that do tax benefits, there are other factors it pays to look at.

For one thing, look at each state's cost of living. You may find that while some states do tax benefits, they also offer much less expensive housing and lower living costs on a whole. And those factors may work to your financial benefit in retirement more so than a lack of taxes.

Another thing to consider is that most of the states that do tax benefits offer some type of exemption for lower earners. This means that if Social Security is your primary or sole income source, your benefits may not actually be taxed after all, even if there is a state tax in place.

Do your research

Taxes on Social Security benefits aren't the sort of thing that should catch you by surprise. It pays to read up on how Social Security works to make sure you understand the ins and outs of your benefits.

Incidentally, it's easy enough to get an estimate of your monthly benefit well ahead of retirement so you know what to expect. All you need to do is create an account on the Social Security Administration's website and access your annual earnings statements, which will summarize your yearly wages and give you a sneak peek at your future benefit.

Editor's note: This article has been corrected to note that West Virginia's exception is not for all residents.