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State retirement taxes · 2026

Does Ohio tax retirement income?

Short answer: Yes — everything except Social Security. Ohio does not tax Social Security benefits. No retirement exclusion — only a retirement income credit of up to $200 per return.

Friendly2026 rules Verified October 23, 2026

What’s taxed in Ohio

2026 rules.

Social SecurityNot taxed
Ohio does not tax Social Security benefits.
PensionsTaxed
Pensions are taxable; a retirement income credit of up to $200 per return helps if income is under $100,000.
IRA & 401(k) withdrawalsTaxed
IRA and 401(k) withdrawals are taxable; they count toward the same up-to-$200 retirement income credit.
Military retirement payNot taxed
Military retirement pay is 100% deductible; federal civil service pensions that include military service get a proportional deduction.
Income tax rate2.75% flat
For 2026, 0% on the first $26,050 of nonbusiness taxable income and 2.75% above — effectively a flat tax, the same for all filing statuses (the 2025 top rate was 3.125%).

Does Ohio tax Social Security?

Ohio does not tax Social Security benefits.

Federally taxable Social Security is fully deducted, with no income or age limit.

Your federal return is a separate question — see how much of your benefit the IRS taxes with the taxable Social Security calculator.

Are pensions taxed in Ohio?

Pensions are taxable; a retirement income credit of up to $200 per return helps if income is under $100,000.

Ohio starts from federal AGI and taxes public and private pensions. The retirement income credit is $0 to $200 per return depending on retirement income ($200 at $8,001 or more), if modified AGI less exemptions is under $100,000. A one-time lump sum retirement credit is an alternative.

Public vs. private pensions: Treated the same: taxable.

Are IRA and 401(k) withdrawals taxed in Ohio?

IRA and 401(k) withdrawals are taxable; they count toward the same up-to-$200 retirement income credit.

Distributions must be on account of retirement to count toward the credit.

Required minimum distributions (RMDs) are IRA and 401(k) withdrawals, so the same rules apply. Estimate your RMD.

Is military retirement pay taxed in Ohio?

Military retirement pay is 100% deductible; federal civil service pensions that include military service get a proportional deduction.

What is Ohio’s income tax rate?

A flat 2.75%.

For 2026, 0% on the first $26,050 of nonbusiness taxable income and 2.75% above — effectively a flat tax, the same for all filing statuses (the 2025 top rate was 3.125%). Business income is taxed at a flat 3% after the business income deduction. Inflation indexing is suspended for 2025–2026.

Standard deduction and exemptions

No standard deduction. Personal and dependent exemptions depend on income: $2,400 if modified AGI is $40,000 or less, $2,150 up to $80,000, $1,900 up to $500,000, and none at $500,000 or more for 2026 (the cutoff was $750,000 for 2025).

What tax breaks do seniors get in Ohio?

A $50 senior citizen credit per return at 65+, the lump sum distribution credit and the retirement income credit of up to $200 — all require modified AGI less exemptions under $100,000. The federal $6,000 senior deduction does not flow through.

What changed for 2026?

HB 96 (the FY2026–27 budget) cut the top rate to 3.125% for 2025 and to a flat 2.75% from 2026, suspended indexing for 2025–2026, created a way for private retirement plans to withhold Ohio tax, and ends exemptions at $500,000 of income from 2026.

The 2026 rate is set by HB 96; credits and deductions come from the 2025 IT 1040 booklet.

How Ohio compares with its neighbors

Thinking of moving across the line? Here’s how each bordering state treats retirement income in 2026.

State tax is half the picture — check the federal side

Is My Social Security Taxable?How much of your Social Security is taxable using the IRS worksheet — and what the new $6,000 senior deduction changes.Open RMD CalculatorYour required minimum distribution for 2026 or 2027, the exact deadline, and the IRS table math behind it.Open IRMAA CalculatorWill your income trigger Medicare's IRMAA surcharge? See your tier, the yearly cost, and how far you are from the next cliff.Open

Ohio retirement tax questions

Is Ohio tax-friendly for retirees?

We rate Ohio “Friendly” for 2026. Ohio does not tax Social Security benefits. No retirement exclusion — only a retirement income credit of up to $200 per return. The top income tax rate is 2.75%.

Are required minimum distributions (RMDs) taxed in Ohio?

RMDs are withdrawals from IRAs and 401(k)-type plans, so they follow Ohio’s rules for those accounts. IRA and 401(k) withdrawals are taxable; they count toward the same up-to-$200 retirement income credit.

Is military retirement pay taxed in Ohio?

No. Military retirement pay is 100% deductible; federal civil service pensions that include military service get a proportional deduction.

What is Ohio’s income tax rate for 2026?

For 2026, 0% on the first $26,050 of nonbusiness taxable income and 2.75% above — effectively a flat tax, the same for all filing statuses (the 2025 top rate was 3.125%). Business income is taxed at a flat 3% after the business income deduction. Inflation indexing is suspended for 2025–2026.

Sources for Ohio

Primary sources only. We re-check them whenever an agency publishes new figures.

  1. State
    Ohio Department of Taxation — 2025 IT 1040 booklet
  2. State
    Ohio Revised Code §5747.02 — Tax rates
  3. State
    Ohio Revised Code §5747.025 — Personal exemptions
  4. State
    Ohio Department of Taxation — Senior citizens and Ohio income taxes
  5. State
    Ohio Legislative Service Commission — HB 96 budget in brief

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