You count on your Social Security checks to help you live independently in retirement. Even if you have savings of your own, you may have a hard time maintaining your existing lifestyle without your benefits. Yet, many retirees have to give a portion of their checks back to the federal government.
The IRS taxes the Social Security benefits of some seniors, depending on their income. Residents of the following nine states could owe state benefit taxes as well. But you could be exempt from state benefit taxation if you meet certain criteria.
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The 9 states that tax Social Security benefits
Social Security benefit taxation at the state level has become less popular over the last few years. The following nine states are the last that still have these tax laws on the books:
- Colorado
- Connecticut
- Minnesota
- Montana
- New Mexico
- Rhode Island
- Utah
- Vermont
- West Virginia
However, living in one of these places doesn't mean you'll automatically owe your state a cut of your checks. Nearly every one of these states has rules that exempt certain filers from paying state benefit taxes. Usually, this is based on your adjusted gross income (AGI). If it's under a certain amount, the state won't tax your benefits. Typically, this exempts low- to middle-income filers. Check with your state's department of taxation or a tax professional to learn if you could owe anything.
Residents of Colorado and West Virginia should note that their state's Social Security benefit tax laws have changed in 2025. In Colorado, individuals aged 55 to 64 with AGIs under $75,000 if filing individually or $90,000 if filing jointly don't have to include any Social Security benefits taxable at the federal level in their state income. This rule already applied to those 65 and older in past years.
West Virginians with AGIs greater than $50,000 for individuals or $100,000 for joint filers will have 65% of their Social Security benefits exempt from state tax in 2025, up from 35% in 2024. Those with AGIs below the above thresholds don't pay any state benefit taxes, and beginning in 2026, the state will exempt all Social Security benefits from its income tax.
Federal Social Security benefit taxation applies to residents in all states
Though it's becoming less common for states to tax Social Security benefits, federal benefit taxation is becoming more common. That's because the taxation thresholds haven't changed in over 30 years.
Federal law determines the taxable percentage of your benefits by looking at your provisional income. This is your AGI, plus any nontaxable interest you might have from municipal bonds, and half your annual Social Security benefit. The table below shows how benefit taxation currently works, based on provisional income and marital status.
|
Marital Status |
0% of Benefits Taxable if Provisional Income Is Under: |
Up to 50% of Benefits Taxable if Provisional Income Is Between: |
Up to 85% of Benefits Taxable if Provisional Income Exceeds: |
|---|---|---|---|
|
Single |
$25,000 |
$25,000 and $34,000 |
$34,000 |
|
Married |
$32,000 |
$32,000 and $44,000 |
$44,000 |
Data source: Social Security Administration.
The above numbers aren't indexed for inflation, which means that as average benefits and incomes rise, more seniors find themselves owing these taxes. In some cases, you may be able to avoid them by limiting how much you withdraw from your retirement accounts or taking more Roth withdrawals, which typically don't count toward your taxable income.
If that doesn't work, you may have to budget some money for benefit taxes each year. You can do this yourself, or request that the Social Security Administration withhold money from your benefits upfront.
Social Security benefit taxes could go away if President Donald Trump succeeds in eliminating them, as he promised to do. For the time being, it's unclear if this will happen, so it's best to plan as if you could still owe them for 2025 and beyond.
