How Mississippi taxes retirement income
Mississippi does not tax Social Security benefits. Pension income is also exempt. Social Security, Railroad Retirement, and qualified public/private pension and retirement-system distributions are fully exempt from Mississippi income tax. Qualified 401(k)/IRA/annuity withdrawals are exempt once retirement-plan requirements are met; early (pre-retirement) distributions are not treated as exempt retirement income and may be taxable. Governed by Miss. Code Ann. Section 27-7-15 (gross income definition and retirement-allowance exemptions) and Section 27-7-16 (pension trusts, tax-sheltered annuities, deferred compensation, and IRAs).
Retirement income tax in Mississippi, at a glance
| Income type | Taxed by Mississippi? |
|---|---|
| Social Security | No |
| Pensions | No |
| 401(k) / IRA withdrawals | No |
| Estate / inheritance tax | None |
| Avg. property tax rate | 0.58% of home value |
Does Mississippi tax Social Security benefits?
No. Mississippi does not tax Social Security benefits.
Does Mississippi tax pensions and 401(k) or IRA withdrawals?
Mississippi exempts pension income, though other retirement withdrawals may still be taxed. Social Security, Railroad Retirement, and qualified public/private pension and retirement-system distributions are fully exempt from Mississippi income tax. Qualified 401(k)/IRA/annuity withdrawals are exempt once retirement-plan requirements are met; early (pre-retirement) distributions are not treated as exempt retirement income and may be taxable. Governed by Miss. Code Ann. Section 27-7-15 (gross income definition and retirement-allowance exemptions) and Section 27-7-16 (pension trusts, tax-sheltered annuities, deferred compensation, and IRAs).
For the mechanics of required withdrawals in retirement, see what is an RMD.
Sources
- Mississippi taxation of retirement income (Social Security, pensions, 401(k)/IRA): Mississippi Department of Revenue / Taxation.