Understanding Social Security Benefits Taxes in the U.S.
Overview of Social Security Benefits Taxes
In the U.S., most retirees only face federal taxes on their Social Security benefits. However, a significant number of states continue to impose additional taxes. This article uncovers the specifics regarding Social Security benefits taxes and highlights which nine states are involved.
States That Tax Social Security Benefits
- New Mexico
- Connecticut
- Montana
- Utah
- Vermont
- Missouri
- Illinois
- Colorado
- West Virginia
Effects on Retirement Income
For many retirees in these states, the taxes on Social Security benefits can significantly reduce their retirement income. It is crucial to be aware of these taxes when planning your financial future.
Planning Around Social Security Taxes
Understanding where and how Social Security benefits are taxed can help you make informed financial decisions. Planning your retirement resources can lead to optimally leveraging your benefits.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.