38 States That Don't Tax Social Security Benefits
While some may disparagingly refer to Social Security benefits as "entitlements," as if you're not entitled to them, you really are. When you work, you pay taxes into the Social Security coffers -- and when you retire, you receive benefits, paid from those coffers. The more you paid in, the more you'll collect, up to a point.
What you collect isn't a mint, though. The average monthly retirement benefit amounts to only about $22,000 for the year, as of July -- which is likely less than what you'll need in retirement. And Social Security benefits make up about 30% of elderly folks' retirement income. So clearly, it's precious. And ideally, you'd want to not be taxed on that income.
Fortunately, if you live in one of 38 states (or the District of Columbia), you won't face state taxes on your Social Security income.
Source Fool.com