Despite the coronavirus pandemic, almost 400,000 Americans moved to a different part of the country to retire last year according to HireAHelper, up a whopping 30% from 2019. Factors such as cost of living, healthcare, and weather tend to be high on people's list of priorities when deciding where to relocate, but taxation is crucial too and can be easily overlooked. Using a recent overview by SmartAsset, click or scroll through as we reveal the least and most tax-friendly states for retirees, taking into account levies on pension income, Social Security, property, and other key taxes that impact seniors, starting with the least tax-friendly.

Seniors are leaving the Golden State en masse to spend their golden years elsewhere. California is in the top three states that retirees are most likely to quit, and no wonder given its punishing taxes. Apart from Social Security, California taxes all forms of retirement income at rates of up to 13.3% and has one of the highest sales taxes in the country. Still, property tax rates are relatively reasonable, while estate and inheritance taxes are non-existent.

Connecticut has been described as a tax nightmare for retirees. Seniors are stung with the third-highest median property tax rate in the country and every type of retirement income is taxed, from pensions to Social Security, though lower-income retirees are entitled to an exemption. Connecticut is the only state that collects a gift tax and is one of 12 that levies an estate tax, but it's only collected on estates worth more than $5.1 million. Also on the upside, the sales tax rate is comfortably below the national average.

Maine's senior taxpayers get a similarly raw deal. Although Social Security isn't taxed, other forms of retirement income are, including pensions and 401(k) account withdrawals. Property tax rates are above the nationwide median and the state imposes an estate tax. Certain seniors, including military vets, qualify for exemptions, however, and the state sales tax is far from excessive at 5.5%. The state also prevents cities and towns from imposing their own local sales tax.

As if the state's bitterly cold winters weren't enough to put off some retirees moving there, Minnesota taxes seniors to the hilt and is one of the 13 states that places a levy on Social Security. All other forms of retirement income are taxed as well, and although military pensions are exempt, there are no other deductions or exemptions for seniors. The sales tax rate levels out at 7.5%, but property taxes are about average.

As in the case in Minnesota, all types of retirement income are fair game for Nebraska's Department of Revenue including Social Security, with only military pensions left off the list. The Cornhusker State is one of just six that imposes an inheritance tax, levying the highest top rate of them all at up to 18%, and property taxes are steep too. The one saving grace is the sales tax rate, which is around the national median.

Rhode Island may be the smallest state in America, but the tax burden it places on seniors certainly isn't. Every single form of retirement income is taxed at rates of up to 5.99%, including Social Security, though a $15,000 exclusion is granted to lower-income seniors claiming a public, private, or military pension. Property tax rates are high, sales tax is above-average, and the state levies an estate tax too. That said, proximity to the ocean and activities such as sailing do make this state an attractive place to live for some.

Vermont slaps taxes of up to 8.75% on retirement income, with everything apart from federal railroad benefits liable, including military pensions and Social Security, though seniors with gross incomes of less than $45,000 a year are granted a full exemption. An estate tax is imposed and the property tax rate is the fifth-highest in the country, but the rate of sales tax is actually quite low.

Moving on to states that are moderately tax-friendly, Arizona puts levies on income from 401(k) and other retirement savings and taxes pensions too, but federal and Arizona state pensions are eligible for a generous deduction. The sales tax rate averages out at 8.4% but the rate of property tax is low, while the state doesn't tax Social Security or collect an inheritance or estate tax.

The nation's capital also falls into the moderately tax-friendly bracket. DC doesn't tax Social Security but does collect a proportion of its residents' income from pensions, IRAs, 401(k)s and other types of retirement account, though up to $3,000 can be deducted. Property tax rates are low but, as SmartAsset points out, bills can be expensive given the district's high real estate prices. Sales tax is low too but an estate tax is imposed.

Hawaii is a mixed picture tax-wise. Social Security and public pensions are exempt from taxation, but the Aloha State taxes private pensions and income from retirement saving plans at rates of up to 11%. Hawaii's top rate of estate tax is 20%, the highest in the country, while the property tax rate is the lowest at just 0.28%. Sales tax is low as well, coming in at between 4% and 4.5%.

Social Security isn't taxed in Indiana either, but the same can't be said for private and public pensions, IRAs, 401(k)s, and other retirement account income, which are all subject to the state's income tax flat rate of 3.23%. However, sales tax isn't too high and the property tax rate stands at just 0.81%, with less well-off over-65s eligible for a large deduction and, best of all, there's no estate or inheritance taxes.

Conversely, Iowa has a high property tax rate and taxes bequests up to 15%, but boasts a similar rate of sales tax and, like Indiana, doesn't tax Social Security and includes income from pensions or 401(k)s when calculating each resident's income tax bill. Big deductions go a lot towards reducing the grand total too.

Starting with the good news, Kansas has no inheritance or estate tax and doesn't levy a dime on public pension income. All other retirement income, however, is subject to a tax rate of up to 5.7%, and seniors whose income exceeds $75,000 a year have to pay tax on Social Security. Adding to the bad news, the property tax rate is higher than the nationwide average, ditto the rate of sales tax.

Maryland is the only state that levies both an inheritance and estate tax, which may go some way toward explaining why so many retirees are leaving – last year 12.3% of Americans who quit their state moved from Maryland. Social Security and 401(k) withdrawals are tax-free, but income from IRAs, as well as public and private pensions, aren't, with income tax rates ranging from 2% to 5.75%. Property and sales taxes are around average.

Massachusetts doesn't consider payouts from Social Security and public pensions taxable but income from private pensions, 401(k)s and IRAs are hit with a tax rate of 5%. Property taxes aren't high but bills can be due to the state's expensive housing market. Sales taxes are fairly low as well, but estate tax kicks in on estates worth $1 million, which is the lowest threshold in the country.

Yet another state with a mixed tax picture, Missouri taxes all forms of retirement income, but those on individual gross annual incomes less than $85,000 or joint gross incomes under $100,000 pay nothing on Social Security, and public pensions income is eligible for major deductions. Property tax tends to be low but sales tax is above-average, although, as SmartAsset notes, taxes on tobacco, booze and gas are among the lowest in the nation.

Social Security income is taxed in Montana too, but the state has a significantly lower threshold of $25,000 for single filers and $32,000 for couples. All other forms of retirement income are taxable at rates of up to 6.9% including capital gains, and exemptions are limited. On a positive note, property taxes are low, while sales, estate, and inheritance taxes are non-existent.

New Jersey is among the states retirees are most likely to leave and who can blame them? The Garden State has the highest property taxes in the country and levies an inheritance tax on estates valued at more than $25,000, with rates ranging from 11% to 16%. Still, Social Security isn't taxed, the rate of sales tax is about average, and though all forms of retirement income are subject to taxation, deductions can be considerable.

Every form of retirement income including Social Security is liable to tax at rates of up to 4.9% in New Mexico, but lower-income seniors can deduct $8,000 from their annual bill. Instead of sales tax, the state has a gross receipts tax, which is imposed on businesses but often passed on to customers, with a combined state and local rate as high as 9.44%. The property tax is low, however, and neither inheritance nor estate tax is collected.

Social Security and public pensions are the only types of retirement income that aren't taxed in New York, but the states does offer all seniors a yearly deduction of $20,000, regardless of wealth, which can massively reduce annual tax bills. Be that as it may, retirees are mined for cash in other ways since property and sales taxes are high and an estate tax is collected.

North Carolina regards all forms of retirement income taxable, bar Social Security, and offers zero deductions to seniors per se, though they can claim the state's sizable standard deductions. Tempering this is the fact property taxes are low, sales tax is about average, and inheritance and estate taxes aren't imposed.

Every type of retirement income is taxed in North Dakota, including Social Security, though less affluent retirees are exempt. But the tax situation isn't as bad as it seems given rates are so low. Property and sales tax rates are around the national median and estate tax is collected on estates valued at greater than $11.7 million (as of 2021).

Social Security is tax-free in Ohio, but other forms of income retirees rely on are liable, from IRAs to public and private pensions, though those on lower incomes can claim modest deductions. Sales and property tax rates are high in the state but a homestead exemption is granted to some seniors, while estate and inheritance taxes are non-existent.

Oregon taxes income from pensions and retirement accounts at up to 9.9%, but only permits credits on pensions for those on low gross incomes. The state shares the lowest estate tax threshold in the country with Massachusetts at $1 million, but rates start at a relatively high 10% compared to Massachusetts' miniscule 0.8%. On the flipside, property taxes are reasonable, and Social Security and sales taxes don't exist.

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More retirees left Utah than any other state last year and it's likely taxes factored into the decision for some of them. The Beehive State is one of the few that fully taxes Social Security. Other types of retirement income are taxable too at a flat rate of 4.95%, and credits can only be claimed on pensions, while sales tax is rather high. Nonetheless, the rate of property tax is super-low and death taxes aren't collected.

Social Security isn't subject to tax in Wisconsin, but all other forms of retirement income are, including capital gains, though some exemptions apply to public pensions, and those on very low incomes can get an exclusion. The property tax rate is high but this is offset somewhat by the state's extremely reasonable sales tax rate. Another plus is the lack of inheritance or estate tax.

Now for the states deemed tax-friendly by SmartAsset. Alabama doesn't tax Social Security or pensions, which is major plus, but 401(k), IRA, and other retirement accounts are subject to a rate of up to 5%. Property taxes are low, and lower still for those eligible for a homestead exemption, and inheritance and estate taxes aren't imposed. Sales tax is well above-average though, and Alabama is one of just three states that taxes groceries at the full rate.

Echoing Alabama, Arkansas levies reasonable property and high sales tax rates and also taxes groceries, albeit at a reduced rate. Social Security and bequests are ignored by the state tax agency, but other forms of retirement income are taxable including capital gains, though deductions are permitted in some cases.

Colorado taxes every type of retirement income, Social Security and most types of capital gains, but taxpayers can offset their annual bill by claiming an annual deduction of $24,000 if they're over 65, while the 55-to-65 age group can offset $20,000. Property taxes are low and eligible for deductions too, and inheritance and estate taxes are non-existent, but the average combined state and local sales tax rate is rather high at 7.65%.

Delaware's biggest draw from a tax point of view is its total lack of sales tax, an advantage it shares with only three other states. Social Security is also tax-free, as are bequests. And while all types of retirement income are subject to taxation in the First State, including capital gains and 401(k)s, yearly deductions of up to $12,500 can be claimed.

Idaho was the fifth most-popular state for retirees to move to last year, and for good reason. The Gem State doesn't tax Social Security, estates, or inheritances, and goes easy on the property and sales taxes. Most forms of retirement income are taxed though at rates of up to 6.925%, but some seniors qualify for a deduction.

Illinois, on the other hand, exempts almost all types of retirement income from taxation, including Social Security, 401(k), IRA, and pension payments. Raining on the parade, however, are the state's property and sales taxes, which are among the highest in the country, along with its estate tax, which kicks in on estates valued at more than $4 million and has a top rate of 16%. As the estate tax is lower than the federal level of $11.7 million, estates that don't need to pay federal taxes will have to pay state estate tax, which may not appeal to retirees who plan to leave sizable inheritances. Illinois is also the only state that taxes prescription meds.

Social Security isn't taxed in Kentucky but other forms of retirement income are. Deductions of up to $31,110 are allowed for seniors though, which can massively reduce the typical annual bill. Property and sales taxes are low, which adds to the state's tax appeal, but seniors contemplating a move should be aware of Kentucky's inheritance tax, which is collected at rates of up to 16%.

Louisiana ticks plenty of tax-friendly boxes. The state doesn't tax Social Security, bequests, or public pension income and has the fifth-lowest property taxes in the nation. Income from retirement savings and private pensions does count, however, but all over-65s can claim a $6,000 deduction on their annual tax bill. The big minus is the combined state and local tax rates, which average a wallet-busting 9.52%.

Michigan's Achilles heel in the tax friendliness stakes is its high property tax rate. In other areas though, the state is kind to seniors. Social Security isn't taxed, and while other forms of retirement income are, retirees can deduct most, if not all, of it. Property and sales taxes are high to moderate, but tax credits are available for some homeowners, plus essentials such as groceries and prescription drugs aren't taxed.

New Hampshire has no income, sales, inheritance, and estate taxes, but isn't a completely tax-free paradise for retirees. The state places a levy on interest and dividends earned from retirement savings, one of just two states to do so (Tennessee is the other), while property and so-called 'sin' taxes on on liquor, cigarettes, and gas are sizable.

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Property taxes are lower in Oklahoma, but the state makes up for this by taxing retirement income, though all over-65s can claim a $10,000 deduction each year. Sales tax can be quite high depending on the locality, but the property tax rate is low and Social Security income, not to mention estates and inheritances are exempt from taxation.

Pennsylvania was the fourth most-popular state for retirees to move to last year and chances are many were enticed by the Keystone State's tax friendliness. Seniors aged 60 or over pay nothing on their pensions, and Social Security and income from retirement savings plans are tax-free too. Sales and property tax rates aren't the lowest though, and the state levies an inheritance tax, which has a top rate of 15%.

South Carolina is one of those states that taxes retirement income, including capital gains, but lets seniors claim large deductions, which helps shrink annual bills. Sales tax is on the high side, but the rate for property is among the lowest in the nation and Social Security, inheritance, and estate taxes aren't collected.

Retirees mulling a move to Tennessee will no doubt be delighted to discover that the state collects zero tax on retirement income and paid employment, though interest and dividends from pensions, 401(k)s, and IRAs are liable, similar to the set-up in New Hampshire. The effective property tax rate is low, plus inheritance and estate taxes aren't levied. In fact, Tennessee would be heaven for retirees from a tax standpoint were it not for its combined state and local tax rates, which average 9.55%, the highest figure in the nation.

Likewise, Texas has no income tax, so retirees pay zilch on everything from Social Security to pensions and IRAs, and estate and inheritance taxes are non-existent. This is offset to a degree, however, by the Lone Star State's high rates of property, sales and 'sin' taxes. Interestingly, Texas is among the states retirees quit in their droves last year.

On the other side of the coin, Virginia was the most popular state for retirees to move to in 2020 according to HireAHelper, overtaking perennial favorite Florida. The Old Dominion places a light tax burden on its older population. Property and sales tax rates are low, while estate, inheritance, and Social Security taxes aren't collected. And although Virginia does tax other forms of retirement income, seniors can claim a substantial deduction on their annual bill.

Washington is another of those states that doesn't levy income tax, and its effective rate of property tax is lower than the national average, which makes it an enticing prospect for any retiree thinking about relocating there. What might put retirees off is the typical combined local and sales tax rate of 9.23% and the state's estate tax, which has the highest top rate in the country at 20%.

In West Virginia, all forms of retirement income are taxed at rates of up to 4.55%, including Social Security, but the deductions available to seniors are generous, which can whittle down annual bills in a big way. Sales tax is reasonable and the rate of property tax is one of the lowest in the country, and nothing at all is levied on estates and inheritances. 

Possibly the most tax-friendly state, Alaska has no income tax and doesn't levy a cent on estates, inheritances, or retail sales, though cities and boroughs can impose their own rates, but these average a tiny 1.76%. The property tax rate is slightly in excess of the US average, but this is offset considerably by the oil wealth dividend check permanent residents receive each year. The payment from the Alaska Permanent Fund was a very healthy $992 in 2020.

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Though Virginia pipped it to the post last year, Florida has been the most popular state for retirees to relocate to over the past decade. Part of the appeal lies in its tax-friendliness toward seniors. All forms of retirement income are tax-free, property and sales tax rates are around the nationwide average, and inheritance and estate taxes have never seen the light of day, with the Sunshine State the only one that prohibits estate tax in its constitution.

Retirement income is eligible for tax in Georgia, but over-65s can deduct an enormous $65,000 from their annual bill. Social Security and bequests are tax-free in the Peach State, property tax is low, but sales tax works out at 7.31% typically when local rates are factored in, which is just above the national average.

Mississippi does have an income tax, but all forms of retirement income from pensions to 401(k)s are exempt. Seniors have no estate or inheritance taxes to worry about either and property tax rates are are the sixth-lowest in the land. The downsides are the sales tax rate, which is as high as 8% in Jackson, plus Mississippi is one of the three states that fully taxes groceries.

It's a similar picture in Nevada. The state doesn't levy a tax on income, so seniors don't have to give away a cent of their precious retirement money, directly at least. The effective property tax rate is a mere 0.53% and estate and inheritances taxes aren't collected. Sales tax is high though, mirroring the set-up in Mississippi.

South Dakota doesn't collect income, estate, or inheritance taxes either. Property taxes work out in excess of the US average but the state offers exemption programs for lower-income seniors. Sales tax is low, even when local rates are included, but the state is one of the three that taxes groceries at the full rate.

Wyoming was the third most-popular state for retirees to decamp to last year, with its tax set-up without question a major draw. According to SmartAsset, it could well be the most friendly to seniors after Alaska's. Income tax isn't collected, nor are levies on inheritances and estates, and property as well as sales taxes are mega-low.

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