State retirement tax · New York
Retirement tax rules for New York residents (2026 guide)
New York's effective income-tax rate at retirement-bracket income is approximately 6.00%. Here's what it taxes, what it exempts, and how the worked numbers shake out.
Last reviewed May 3, 2026
Editorial review pending — see editorial process
Effective rate
6.00%
Taxes Social Security?
No
Approx. tax on $90k income
$3,600
Pension carve-outs
Yes
New York runs a higher effective rate (6.00% or more on retirement-relevant income) but mitigates the bite with a full Social Security exemption. The conventional move for retirees in high-tax states is to weigh whether your retirement-stage tax savings from relocating clear the moving and quality-of-life costs.
What New York taxes (and what it doesn’t)
New York taxes retirement income (401(k) withdrawals, IRA withdrawals, pension payments) at the state's standard income-tax rate. Social Security benefits are FULLY EXEMPT from state tax — this matters because it can change your effective state-tax burden by 2-4 percentage points compared to a state that taxes SS.
State-specific note
$20k pension/IRA exclusion for 59½+; SS fully exempt. Top bracket 6.85% above $215k single.
A worked example
Worked example. A New York retiree with $60,000 of pension and IRA withdrawals plus $30,000 of annual Social Security is taxed on the $60,000 of non-SS income only (SS is exempt). At the approximate 6.00% effective rate, that's about $3,600/year — roughly $300/month — owed to the state.
Should you relocate?
New York's high effective rate is the most-cited reason retirees consider relocating. Before moving, model both your before-tax cost of living and the tax-bracket arbitrage carefully — a $15K/year tax saving can be eaten by a $1.5M home purchase in the destination market.
See how New York state tax shapes your retirement plan
The calculator’s Taxes tab uses the 6.00% effective rate above and the SS-exemption flag automatically. Run your specific numbers and see the year-by-year tax forecast.
Run my numbersFrequently asked
Does New York tax my Social Security?
No. New York fully exempts Social Security benefits from state income tax. You'll only owe state tax on non-SS retirement income (401(k), IRA withdrawals, pensions, brokerage gains).
What's the effective state tax rate on my retirement income?
New York's approximate effective rate for retirement-bracket income is 6.00%. For a $90k retirement income with $30k of Social Security, you'd owe roughly $3,600/year in state tax. Real liability varies with bracket structure, age-based exclusions, and pension carve-outs.
Should I relocate to New York for retirement?
It depends on the size of your retirement income, the destination state's effective rate, and your moving costs. The state-tax differential alone is rarely the decisive factor for normal-income retirees. For households with $1M+ retirement income, multi-year tax-arbitrage savings can exceed $20k/year — enough to drive the decision.
Are pension benefits taxed differently in New York?
Many states have specific carve-outs for pension income — particularly for public-sector pensions (teachers, firefighters, police, military). $20k pension/IRA exclusion for 59½+; SS fully exempt. Top bracket 6.85% above $215k single. Yearfold's calculator uses an effective-rate approximation; real liability may be lower if you qualify for a pension exclusion.
Does this apply to property tax too?
No. This page covers state INCOME tax only. Property tax in New York is set by local jurisdictions (county / city / school district) and varies dramatically within the state. For a complete retirement-cost picture, consult your specific county's tax assessor.
Primary sources
Effective-rate and SS-taxation flags above are derived from these sources. We re-verify each annually.
Related reading
California retirement tax rules
Comparable effective rate (6.00% vs 6.00%).
Arizona retirement tax rules
For perspective from a different tax tier.
Vermont retirement tax rules
An example of a state that DOES tax Social Security.
Run my numbers
The calculator's Taxes tab uses the same per-state effective rate.
How the Monte Carlo actually works
2,000-word methodology page — covers state tax modelling.