State Income Tax Updates!
As we dive into the new year, the team—David Darby, Kevin Roche, CFP?, and I—are here to help you navigate the ever-changing tax landscape. Whether it’s Federal or State Income Taxes, understanding these updates is key to optimizing your finances. Here’s a comprehensive look at what’s happening across the country.
States with No Income Tax
Did you know there are states where residents enjoy no state income tax? Here’s the list:
?? Alaska ?? Florida ?? Nevada ?? South Dakota ?? Tennessee ?? Texas ?? Wyoming ?? Washington* ?? New Hampshire*
What’s the Catch for Washington and New Hampshire?
States with No Tax on Traditional Retirement Income
For retirees, these states provide relief by exempting income from Traditional retirement accounts:
?? Alaska ?? Florida ?? Nevada ?? South Dakota ?? Tennessee ?? Texas ?? Wyoming ?? Washington ?? New Hampshire ?? Illinois* ?? Iowa* ?? Mississippi* ?? Pennsylvania*
Special Rules Apply
States That Tax Social Security
Rather than listing the 41 states that don’t tax Social Security, here are the 9 that do:
?? Colorado ?? Connecticut ?? Minnesota ?? Montana ?? New Mexico ?? Rhode Island ?? Vermont ?? West Virginia*
领英推荐
West Virginia Is Changing
By 2026, West Virginia plans to fully eliminate its Social Security tax, providing relief for retirees.
Major Tax Updates for 2025
Several states are rolling out significant tax reforms in the coming year. Here are the highlights:
Additional updates in Iowa, Michigan, Mississippi, Missouri, Nebraska, Rhode Island, South Carolina, and more.
Retroactive Tax Changes to Watch
A few states have enacted changes that could impact your 2024 filings:
What Does This Mean for You?
Tax reforms can impact your finances in surprising ways, whether through lowered rates, increased deductions, or new tax exemptions. Now is the perfect time to review your strategy and maximize your opportunities for savings.
?? Stay tuned for detailed breakdowns, planning tips, and insights to help you make the most of the new tax laws.
Here’s to a financially savvy and successful 2025!