14 States Where Your Pension Won’t Get Taxed

Hawaii

Pensions: Want to spend your golden years on sandy beaches, lying under the sun and sipping cocktails? Then, Hawaii is the place to go. Want to keep your pension intact? Again, the Aloha State is the place where you can do just that. That’s because Hawaii doesn’t levy any taxes on retirement distributions from a private or public pension plan on one condition, though: if you didn’t make contributions to the plan. Otherwise, the portion of your pension income related to your contributions will be taxed.
401(k)s and IRAs: Distributions from 401(k) plans and IRAs are subject to state income tax. On the bright side, if your employer made matching contributions to your 401(k) plan you can get an additional deduction for the portion matched by your employer.
Social Security Benefits: Social Security benefits are not subject to taxes in Hawaii.
Income Tax Range: In terms of taxable income in Hawaii, the lowest tax rate is 1.4% while the highest rate is 11%.

Illinois

Pensions: Private pension income is completely exempt from taxes in Illinois if it comes from a qualified employee benefit plan. Government or military pensions are tax-free as well.
401(k)s and IRAs: When it comes to 401(k) plans and IRAs, the Prairie State is also one of the few states that doesn’t tax distributions to these retirement plans if the plan is a qualified employee benefit plan. The same goes for IRA distributions.
Social Security Benefits: Illinois doesn’t tax Social Security benefits.
Income Tax Range: Illinois has a fixed income tax rate of 4.95%.

You won’t be mississing a single cent if you live in this next state…..