8 Social Security Updates Advisors Need to Know for 2024

8. Three states have recently eliminated taxes on Social Security.

Taxation of Social Security benefits has recently been eliminated in Missouri, North Dakota and West Virginia.

Starting in 2024, Social Security benefits in Missouri will no longer be taxed. Before 2024, retired Missouri residents aged 62 and older with a gross income of $85,000 or more paid state income taxes up to 4.95%.

Taxation of Social Security benefits in North Dakota has been repealed, and in West Virginia, tax authorities have phased out state income tax on Social Security for many residents.

For the 2021 tax year, West Virginians that made $50,000 or less ($100,000 for couples filing jointly) were allowed to exclude up to 6.5% of the benefits they receive from Social Security. Beginning in 2022, 100% of Social Security benefits were free of tax.

For people with incomes above those levels, benefits are taxed according to the federal model. West Virginia’s income tax rates ranged from 3% to 6.5%.

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