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Throughout your working life, legally avoiding high tax bills was likely a priority. The desire to keep both Uncle Sam and your state government at an arm's length doesn't end when you reach retirement.
Many people move to tax-friendly states at the start of their golden years. Here are 12 states that are becoming tax havens for retirees. The low rates they offer can shield your nest egg from unnecessary costs and allow you to enjoy a stress-free retirement.
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Alaska
Retirees who don't mind a little cold weather may warm to Alaska, thanks to its low tax burden.
The Last Frontier State has no income tax, so all manner of retirement income — Social Security, pension, 401(k) and IRA — escapes taxation. There is no state sales tax in Alaska and no estate or inheritance tax.
Delaware
Delaware has long been a haven for companies due to its tax-friendly corporate taxes, but citizens of the state also get a pretty good deal on taxes.
The First State does not have a sales tax and has low property taxes. Retirees enjoy the fact that there is no tax on Social Security income and no estate or inheritance tax.
Florida
Retirees seeking warm weather flock to Florida, which is also among the friendliest states in the nation for those who want to avoid taxes.
The Sunshine State has no income tax, meaning retirement income is not subject to taxes.
There is no estate or inheritance tax in Florida. Just keep your eyes on the skies during hurricane season.
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Iowa
Iowa may not leap to mind as a retirement haven, but the state allows all citizens 55 and older to skip paying state taxes on retirement income.
The Hawkeye State also recently repealed its inheritance tax. Watch out for property taxes, however, which exceed the national median.
Mississippi
If you want to retire but your pool of savings is shallow, try the state of Mississippi.
The Magnolia State does not tax any form of retirement income, including Social Security benefits, pensions and 401(k) and IRA income. The state's property taxes are also modest.
New Hampshire
New Hampshire is a relatively new addition to the list of retiree tax havens. The state's ascendancy to that status is the result of its decision to abolish all income taxes beginning in 2025.
There is also no state sales tax in the Granite State, but property taxes rank among the nation's highest.
Nevada
If you love to gamble, roll the dice on spending your golden years in Nevada, home to gaming centers such as Las Vegas and Reno.
Retirement income is safe from taxes in the Silver State, which has no income tax. Property taxes are also low, and sales taxes are about average compared to the rest of the U.S.
South Dakota
South Dakota flies a bit under the radar as a tax haven, but more people are discovering the financial lure of the Mount Rushmore State.
You won't pay taxes on retirement income, as there is no state income tax. Both sales taxes and property taxes tend to be on the low side.
Tennessee
There are no state income taxes in Tennessee, so it's easy to keep your retirement income out of the state government's clutches.
Other taxes are a mixed bag in the Volunteer State. Property taxes are low, but sales taxes are on the high side.
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Texas
They say everything is bigger in Texas, but that does not include income taxes.
There is no such tax in the Lone Star State, so retirees can enjoy their retirement income a bit more. However, both property taxes and sales taxes are surprisingly high in Texas.
Washington
Washington's biggest city — Seattle — is a famously expensive place to live. But retirees shouldn't automatically cross the state off their list of places to relocate.
The Evergreen State has no income tax, so you can stretch your dollars a bit further. However, there is a state tax on long-term capital gains, and sales and property taxes are on the high side.
Wyoming
Those who like wide-open spaces — and full wallets — might enjoy retiring in Wyoming.
The Equality State has no income tax, which helps you to get the most out of your nest egg. Both property taxes and sales taxes rank among the lowest in the nation.
Bottom line
Taxes should not be the only factor when deciding where to retire. However, it would be naive to ignore the bite that taxes can take out of your retirement income.
If you are hoping to avoid wasting money in retirement, the states on this list have taxes that are low enough to offer a financial boost during your golden years.
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