Some states have age/income-based pension exclusions. No matter your age or wealth, these states don't tax pension income.
Colorado,California,Connecticut,Florida,Kansas,Minnesota, Missouri,Montana,Rhode Island ,Vermont,West Virginia ,New Jersey
If you have a traditional pension, congrats!. Pension payments are taxed as ordinary income after retirement.
State taxes pension income? The location matters. Most states tax private sector DB income.
Your state may have a pension exclusion, but it's likely age and/or income-based. Several states don't tax pension income, regardless of age or wealth.
But, of course, just because a state doesn't tax your pension doesn't mean it won't tax another source of income you're counting on in retirement.
For example, Alabama doesn't tax pensions or Social Security benefits, but it does tax money taken out of a 401(k) plan.
Before moving to a state to spend your golden years, make sure you know how taxes work for retirees there as a whole.
Quordle 147 Answers For June20