State retirement tax · New York
Retirement tax rules for New York residents (2026 guide)
New York's retiree math depends on where the pension came from. Social Security and New York State, local and federal government pensions are fully exempt; private pensions and IRAs get a $20,000-per-person exclusion from 59½; everything above that is taxed at graduated rates. Enhanced STAR trims school taxes for homeowners 65+.
By Mindaugas Laucius · Last reviewed October 21, 2026
Rate on retirement income
2.67%*
Taxes Social Security?
No
Approx. tax on $90k retirement income
$2,400
Pension carve-outs
Yes
Quick figures: a single filer with $90,000 of income, $30,000 of it Social Security.
Government pensions vs. private plans
New York never taxes Social Security or pensions from New York State, its localities and public authorities, or the federal government (including military). Private pensions, annuities, 401(k) and IRA distributions get a pension and annuity exclusion of up to $20,000 per person once you're 59½ for the whole year; amounts above that are taxed under the graduated schedule.
Source: NY Dept. of Taxation and Finance — personal income tax ↗
Enhanced STAR
Homeowners 65+ with income of $110,750 or less on their 2024 return qualify for Enhanced STAR on the 2026–27 school tax bill; all owners must be 65+, except that spouses or siblings who own together need only one of them to be. New owners now get it as a credit check rather than an exemption, and it has to be renewed each year.
Sales tax
The state rate is 4%, with local rates on top; New York City's combined rate is 8.875%.
Worked examples
A retired state teacher
- $60,000 New York State teachers' pension + $30,000 of Social Security.
New York tax on both: $0.
A private-sector pension at 62
- $50,000 private pension − $20,000 exclusion = $30,000 taxable at graduated rates.
Only $30,000 of the $50,000 is exposed to New York tax.
A couple with IRAs
- Each spouse withdraws $20,000 from their own IRA; each uses their own $20,000 exclusion.
$40,000 of withdrawals, $0 of it taxable in New York.
Recent and pending changes
- 2026–27: the Enhanced STAR income limit is $110,750, based on 2024 income.
Run your own numbers — pick New York in the calculator’s Taxes tab for a year-by-year estimate. Or compare all 50 states and DC.
Thinking about a move? The free state-to-state retirement tax comparison puts New York next to any other state on your own income.
New York questions
Can my spouse use my unused $20,000 exclusion?
No. Each person's exclusion applies only to their own pension and annuity income.
Is a federal pension taxable in New York?
No — federal civil-service and military pensions are fully exempt, like New York public pensions.
Does New York tax Social Security?
No, benefits are not taxed.