State-by-State Guide to Taxes on Retirees
Tool | November 2019

State-by-State Guide to Taxes on Retirees


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The Bottom Line
Flag of Kansas

Least Tax-Friendly

While there’s no place like home, maybe Dorothy should think about returning to Oz when she retires to avoid Kansas’ high taxes. Distributions from private retirement plans (including IRAs and 401(k) plans) and out-of-state public pensions are fully taxed. Kansas also taxes Social Security benefits received by residents with a federal adjusted gross income of $75,000 or more. Military, federal government and in-state public pensions are exempt from state income taxes, though.

Shopping in Kansas can be expensive, too. The Sunflower State’s average combined state and local sales tax rate is the eighth-highest in the U.S. at 8.67%.

Property taxes are above the national average as well, though some breaks are available for seniors.

State Sales Tax

6.5% state levy. Localities can add as much as 4%, and the average combined rate is 8.67%, according to the Tax Foundation. These rates apply to groceries as well. A food sales tax credit of $125 per person is available to seniors and those claiming dependents; income limitations apply.

Income Tax Range

Low: 3.1% (on $2,500 or less of taxable income for single filers and $5,000 or less for joint filers)

High: 5.7% (on more than $30,000 of taxable income for single filers and more than $60,000 for joint filers). Also, almost 500 school districts in Kansas impose a local tax on interest and dividends.

Effective tax rate: 4.04% for single filers, 5.04% for joint filers.

Social Security

Social Security benefits are exempt from Kansas income tax for residents with a federal adjusted gross income of $75,000 or less. For taxpayers with a federal AGI above $75,000, Social Security benefits are taxed by Kansas to the same extent they are taxed at the federal level.

Exemptions for Other Retirement Income

Income from federal government, designated Kansas state and local government, and military retirement plans is exempt.

Railroad Retirement benefits are also exempt.

Property Taxes

In Kansas, residents pay $1,491 in taxes per $100,000 of assessed home value.

Tax breaks for seniors: Kansas offers two programs to reduce the property tax burden on seniors. Homeowners 55 and older who earn $35,000 or less in 2018 are eligible for a refund of up to $700 under the Homestead Property Tax Refund Act (note: 50% of Social Security benefits can be excluded from income for the purposes of qualifying for this program). The Safe Senior property tax refund is available for homeowners 65 or older with household income of $19,800 or less in 2018. The refund is 75% of the property taxes paid. The appraised value of the home cannot exceed $350,000 in order to receive this refund. Those who claim this refund cannot claim a Homestead refund.

Vehicle Taxes

Sales tax is due on purchases. Counties charge an annual excise tax based on a vehicle’s age and value.

Inheritance and Estate Taxes