Retirement tax · state rules

States that tax Social Security in 2026

In 2026, eight states tax Social Security benefits: Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah and Vermont. Every other state exempts them, either by law or because it has no income tax. West Virginia joined the exempt states this year, when its phase-in reached 100%. Each of the eight starts from the part of the benefit the federal return taxes, then applies its own exemption, income limit or credit, so many retirees in those states owe nothing on their benefits.

Eight states tax Social Security in 2026

Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah and Vermont. For a couple at 67 with $50,000 of Social Security and a $120,000 IRA withdrawal, $42,500 of the benefit is federally taxable: Colorado taxes none of it; Connecticut taxes $12,500; Minnesota, Montana, New Mexico, Rhode Island, Utah and Vermont tax all of it.

The eight states and their 2026 rules

State → how Social Security benefits are taxed in 2026
State	2026 rule	Source
Colorado	Fully exempt from age 65. At 55–64, fully exempt with AGI up to $75,000 single or $95,000 joint; above that, up to $20,000 of each person’s benefits is subtracted, a cap shared with pension and annuity income.	Colorado General Assembly
Connecticut	Fully exempt with AGI under $75,000 single or $100,000 joint or head of household. Above that, the state taxes at most 25% of the lesser of the benefits and provisional income over the federal base amount.	2025 CT-1040 instructions
Minnesota	Fully subtracted with AGI up to $86,410 single or $110,780 joint (2026, indexed yearly). Above that the subtraction falls 10% for each $4,000 of AGI over the limit. An alternative subtraction also exists.	Minn. Stat. 290.0132, subd. 26
Montana	Taxed to the extent the federal return taxes it: Montana starts from federal taxable income. Each taxpayer 65 or older subtracts $5,660 (the 2025 amount, indexed yearly).	Montana Department of Revenue
New Mexico	Fully exempt with AGI up to $100,000 single or $150,000 joint (head of household too). Above that there is no exemption at all: a cliff, not a phase-out. Not indexed.	NM Taxation and Revenue, 2025 PIT-ADJ instructions
Rhode Island	Fully exempt for a taxpayer who has reached full Social Security retirement age with AGI below $107,000 single or $133,750 joint (the 2025 limits; indexed yearly). From 2027 the age requirement is repealed and the income limit alone applies. Otherwise taxed as on the federal return.	RI Division of Taxation, ADV 2025-22
Utah	Taxed, with a nonrefundable Social Security credit at the 4.45% income-tax rate, which phases out by 2.5 cents per dollar of income over $54,000 single or $90,000 joint and head of household.	Utah Code 59-10-1042
Vermont	Fully exempt with AGI up to $55,000 single or $70,000 joint, phasing out to no exemption at $65,000 or $80,000 (Act 71 of 2025). Not indexed.	Vermont Department of Taxes

How much of the benefit each state taxes

Four retirees aged 67, each with Social Security ($50,000 for a couple, $30,000 single) and a withdrawal from a traditional IRA, no other income. Each cell is the part of the benefit the state counts as income in 2026, computed by Coastline's engine with the rules above; it is then taxed at the state's own rates.

State → Social Security counted as state income, 2026
State	Couple, 67, $60k IRA	Couple, 67, $120k IRA	Single, 67, $50k IRA	Single, 67, $90k IRA
Federally taxable	$40,850 of $50,000	$42,500 of $50,000	$25,500 of $30,000	$25,500 of $30,000
Colorado	$0	$0	$0	$0
Connecticut	$12,500	$12,500	$7,500	$7,500
Minnesota	$0	$42,500	$0	$20,400
Montana	$40,850	$42,500	$25,500	$25,500
New Mexico	$0	$42,500	$0	$25,500
Rhode Island	$0	$42,500	$0	$25,500
Utah	$40,850	$42,500	$25,500	$25,500
Vermont	$40,850	$42,500	$25,500	$25,500

States that stopped taxing benefits recently

West Virginia. Fully exempt from 2026: the phase-in of the exemption above $50,000 / $100,000 of AGI reached 100% this year (35% in 2024, 65% in 2025). (source)
Kansas. Fully exempt since 2024, when the $75,000 AGI limit was removed. (source)
Missouri. Fully deductible since 2024, regardless of income. (source)
Nebraska. Fully exempt since 2024. (source)

How the federal part works

Every state on the list starts from the federally taxable part of the benefit, which depends on provisional income: none of the benefit below $25,000 ($32,000 joint), and up to 85% above $34,000 ($44,000 joint). The Social Security tax calculator shows that step, and the retirement income tax calculator adds the tax on withdrawals and RMDs.

Educational, not tax advice. Rules for tax year 2026, checked against each state's official source (linked) on 2026-10-11; Minnesota's 2026 income limits are the Minnesota Department of Revenue's published 2026 inflation-adjusted amounts. State rules change often, so confirm with the state's current instructions.

Run this with your real numbers

Open the couple at 67 in Minnesota, then change the state: every year of the plan shows the state tax on the benefits and the withdrawals.

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Common questions

Which states tax Social Security in 2026?

Eight: Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah and Vermont. Most of them exempt benefits below an income limit or by age, so many retirees there owe no state tax on them.

Does West Virginia tax Social Security?

Not from 2026. Its exemption for incomes above $50,000 single or $100,000 joint was phased in at 35% in 2024 and 65% in 2025, and reached 100% in 2026.

Do Kansas, Missouri and Nebraska tax Social Security?

No. All three have fully exempted benefits since 2024.

Do states tax Social Security the same way as the IRS?

Each state that taxes it starts from the federally taxable part of the benefit, then applies its own exemption, income limit or credit, so the state counts the same amount or less, and often none.