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Though thousands and thousands of Individuals don’t have to pay taxes on their hard-earned Social Safety checks, federal and state tax legal guidelines can successfully scale back the funds retirees obtain. 9 states nonetheless tax Social Safety advantages in 2025, however that quantity may proceed to shrink, with West Virginia phasing out its tax and lawmakers in different states attempting to do the identical.
It is an ongoing motion. Whereas campaigning final yr, President Donald Trump promised to end federal taxes on Social Security, that are paid by about 40% of the roughly 70 million individuals who obtain month-to-month advantages. Nevertheless, he’ll want Congress’ assist to make good on that promise, whereas states get to set their very own agenda. (Up to now, this proposed lower to federal Social Safety taxes hasn’t been included in the large Trump tax bill that Congress is drafting.)
State taxes on Social Security benefits are additionally being scrutinized. There’s been a pattern away from them lately, led by critics who say these taxes unfairly chip away at advantages Individuals earned and need to obtain in full. Additionally they argue that eliminating or lowering state taxation of Social Safety would assist older adults cope with the cost-of-living disaster. After years of higher-than-normal inflation, thousands and thousands of beneficiaries are struggling to afford on a regular basis necessities, and nearly a third of retired Individuals say they’ve been fascinated with going again to work.
These arguments have been persuasive in lots of components of the nation. Most not too long ago, Kansas and West Virginia passed laws final yr to remove or section out their taxes on Social Safety advantages. Listed below are the 9 states the place Social Safety remains to be taxed in 2025:
Colorado
Whereas Colorado has a state revenue tax of 4.4%, just some Social Safety recipients pay taxes on their advantages. People 65 and older can deduct Social Security for state tax functions. As of 2025, taxpayers between 55 and 64 whose revenue falls below sure thresholds can deduct Social Safety. Some youthful beneficiaries should pay taxes on their advantages.
Connecticut
Retirees in Connecticut solely pay state taxes on Social Safety advantages if their adjusted gross revenue is over $75,000 for people or over $100,000 for {couples}. Even nonetheless, 75% of advantages are exempt from state taxes.
Minnesota
In Minnesota, married {couples} submitting collectively keep away from taxes if their revenue falls beneath $108,320 (For single filers, the cutoff is $84,490.) Whereas higher-income Minnesotans are nonetheless topic to taxes, some state lawmakers are supporting a bill that will finish all taxation of advantages.
Montana
Montanans with incomes over $32,000 for married {couples} or over $25,000 for people are topic to state taxes on Social Safety advantages. (Deductions can be found to higher-income taxpayers.) A 2023 attempt to finish this taxation was unsuccessful.
New Mexico
Most New Mexico taxpayers keep away from state taxes on Social Safety since lawmakers handed laws in 2022 permitting single residents incomes below $100,000 and married {couples} incomes below $150,000 to totally deduct Social Safety funds from their taxable revenue. Retirees with incomes above these thresholds are topic to revenue tax starting from 1.7% to five.9%, together with on Social Safety advantages.
Rhode Island
In Rhode Island, residents keep away from taxes on Social Safety in the event that they’ve reached the total retirement age and their revenue is beneath a specific amount ($104,200 for single filers as of 2024). Different retirees pays revenue taxes, which vary from 3.75% to five.99%, on their advantages.
Vermont
Particular person taxpayers in Vermont are usually not topic to taxes on advantages if their revenue is beneath $50,000. For married {couples}, the edge is $65,000. However for folks incomes above these quantities, state taxes shortly start to kick in and are absolutely in impact for people incomes over $60,000 and {couples} over $75,000.
A group of over 60 lawmakers, together with Democrats and a few Republicans, is pushing to extend the revenue thresholds for the state’s Social Safety tax.
Utah
Some households earning over $90,000 are nonetheless topic to Social Safety taxes. Utah Gov. Spencer Cox wished to remove the tax fully earlier this yr. In January, Cox referred to his efforts to finish all taxation of advantages in Utah as his “most popular proposal” in years, because it may save sure households practically $1,000 per yr. At the moment, some Social Safety advantages in Utah are taxable on the state’s 4.55% revenue tax charge (although there’s a tax credit score fully offsetting that for lower-income households).
The Utah legislature didn’t advance the governor’s full ask in its most up-to-date funds. Utah Senate President Professional Tempore Wayne Harper stated it merely wasn’t potential within the “socks and underwear” funds for 2025.
In a press release to Cash, Harper explains: “The objective was to alleviate the burden of Social Safety taxes for people in Utah. Whereas we did not have the assets to fully remove it, we had been in a position to make vital progress.” That progress refers to a rise within the revenue threshold from $75,000 in $90,000 — a small step towards the governor’s loftier objective.
Cox didn’t reply to Cash’s request for remark in regards to the standing of his extremely touted coverage proposal to remove the Beehive State’s Social Safety taxes.
West Virginia
Taxes on Social Safety advantages in West Virginia shall be eradicated quickly. Increased-earning beneficiaries topic to those taxes have already seen them lowered by 65% below a invoice signed final yr. These taxes are being phased out fully by 2026.
Extra from Cash:
When Social Security Recipients Will Get Their Checks in January
2025 COLA Announced: Here’s How Much Social Security Benefits Will Increase Next Year
The Everyperson’s Guide to Making Money in Trump’s America
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