Core Insights - Many retirees may resonate with the sentiment of the Beatles' song "The Taxman," but there are states in the U.S. that do not impose taxes on retirement income [1] Tax-Free States for Retirement Income - Thirteen states do not tax retirement income, including Social Security, 401(k), IRA, or pension income [4] - The states that do not have any income tax are: Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming [5] States with Income Tax but No Retirement Income Tax - Four additional states have income taxes but do not tax retirement income from Social Security, 401(k) plans, IRAs, or pensions: Mississippi, Pennsylvania, Illinois, and Iowa [6][7] - Mississippi plans to gradually eliminate its state income tax, currently taxing income (excluding retirement income) at a rate of 4.4% above $10,000 [6] States Taxing Social Security Benefits - Forty-one states do not tax Social Security benefits, which includes the thirteen states that do not tax any retirement income [4][7] - The states that tax Social Security benefits include Illinois, Iowa, Mississippi, and Pennsylvania [7]

Core Insights - Retirement planning can be complex and overwhelming, leading to costly mistakes without professional guidance [1][2] Group 1: Common Retirement Planning Mistakes - Claiming Social Security too early can result in a smaller benefit for life; delaying benefits until age 70 can increase the amount by 8% per year [3] - Ignoring taxes on Social Security can lead to taxation on up to 85% of benefits if other income sources are present; working with a financial advisor is recommended to manage withdrawals [4] - Failing to take required minimum distributions (RMDs) by age 73 from tax-advantaged accounts can incur an excise tax; automatic withdrawals can help mitigate this risk [5] Group 2: Medicare and Tax Considerations - Missing Medicare enrollment can result in a 10% penalty for each year of delay, increasing monthly costs; staying informed about enrollment windows is crucial [6] - Triggering Income-Related Monthly Adjustment Amount (IRMAA) taxes can occur from significant income spikes; spreading income across multiple years can help avoid extra charges [7]