Retire to a Tax-Friendly State
Are Social Security benefits taxable? You can bet your bottom dollar they are! In fact, depending on your income, Uncle Sam taxes as much as 85% of your benefits while certain states have their own state tax which applies only if your income exceeds a certain threshold.
However, a tax on Social Security benefits doesn’t automatically turn a state into an unsuitable place for retirement. There are tax-friendly states where you can happily live your golden years and minimize the tax hit. See our Top 20 Affordable Cities for Retirees in 2020 with detailed information on state tax rules and special exemptions.
