Tool | October 2016

State-by-State Guide to Taxes on Retirees

Our comprehensive guide to taxes on retirement income, property and purchases, as well as special tax breaks for seniors, in every state.


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The Bottom Line
Map of Florida

Most Tax-Friendly

One of Kiplinger's top ten most tax-friendly states for retirees, the Sunshine State is very popular with retirees, not just because of its year-round sunshine but also because of the absence of a state income tax. Average sales taxes, though, can go as high as 7.5%. Permanent residents are entitled to a homestead exemption of up to $50,000, regardless of age, and seniors may qualify for an additional exemption.

State Sales Tax

2.9% state levy. Localities can add as much as 8%, and the average combined rate is 7.52%, according to the Tax Foundation.

Income Tax Range

There is no state income tax.

Social Security

Benefits are not taxed.

Exemptions for Other Retirement Income

Retirement income is not taxed.


Retirement income is not taxed.

401(k)s and Other Defined-Contribution Employer Retirement Plans

Retirement income is not taxed.

Private Pensions

Retirement income is not taxed.

Public Pensions

Retirement income is not taxed.

Property Taxes

Every person who owns and resides on property in Florida on January 1 and makes the property his or her permanent residence is eligible to receive a homestead exemption up to $50,000. The first $25,000 applies to all property taxes, including school district taxes. The rest of the exemption, up to $25,000, applies to the assessed value between $50,000 and $75,000, and only to nonschool taxes.

Any widow or widower who is a Florida resident may claim a $500 exemption. If you remarry, you are no longer eligible for the exemption.The legally blind may qualify for a $500 exemption. Quadriplegics are exempt from all property taxes on their homestead. Persons who use wheelchairs or are legally blind and make less than $27,732 in 2015 are also exempt from property taxes on their homestead.Surviving spouses of veterans or first responders who died in the line of duty may be exempt from taxes on their homestead under the Fallen Hero Family Tax Relief Act.

The median property tax on Florida's median home value of $162,700 is $1,631.

Tax breaks for seniors: Florida residents ages 65 and older who meet certain income limits can receive an extra homestead exemption of up to $50,000 from some city and county governments and/or an exemption equal to the assessed value of the property, as long as the real estate has a fair market value of less than $250,000, the homeowner has maintained permanent residence at the location for at least 25 years, and household income does not exceed $28,482 during 2016.

Inheritance and Estate Taxes

There is no inheritance tax or estate tax.