Hawaii retirement taxes at a glance (2026)
| State income tax | Graduated, top rate 11%Hawaii has 12 brackets from 1.4% to 11%. |
|---|---|
| Social Security | Not taxedHawaii does not tax Social Security or tier 1 Railroad Retirement benefits. |
| Pensions | Partly taxedEmployer-funded pensions (public or private) are exempt. The part of a pension that comes from the employee's own elective contributions is taxed. |
| 401(k) and IRA withdrawals | TaxedDistributions from self-funded IRAs, 401(k) elective deferrals, 403(b), 457 plans and the federal TSP are taxable; employer-match portions can be excluded. |
| Government pensions | Not taxedState, county and federal government pensions are exempt to the extent employer-funded. |
| Military retirement pay | Not taxedHawaii does not tax military pensions. |
| Estate tax | Yes, above $5,490,000Hawaii taxes estates above $5.49 million, at rates from 10% to 20%. |
| Inheritance tax | No |
| Property tax help for seniors | Relief varies by county: for example Honolulu gives a $160,000 home exemption at 65+, and Kauai gives $260,000 at 70+. |
| Sales tax | Hawaii has a general excise tax instead of a sales tax; the combined state and local average is about 4.5%. |
Recent changes and good to know
- Act 46 (2024) raises the standard deduction and widens brackets in stages; the standard deduction is $8,000 single / $16,000 joint for 2026.
How to lower your retirement taxes in Hawaii
- Mix your income sources. Roth IRA withdrawals are tax-free at the federal level and generally in Hawaii too, so a Roth conversion before retirement can cut state tax later. Try the Roth conversion calculator.
- Watch federal Medicare costs. Large IRA withdrawals can raise your Medicare premiums. Check the 2026 IRMAA brackets.
- Think about your heirs. See what your IRA will really cost your family with the Family Tax Rate calculator.
- Comparing states? These have no state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming.
Frequently asked questions
Does Hawaii tax retirement income?
Partly: Hawaii exempts Social Security and employer-funded pensions (including military), but taxes IRA and 401(k) money you contributed yourself at up to 11%.
Does Hawaii tax Social Security?
Hawaii does not tax Social Security or tier 1 Railroad Retirement benefits.
Does Hawaii tax pensions?
Employer-funded pensions (public or private) are exempt. The part of a pension that comes from the employee's own elective contributions is taxed.
Does Hawaii tax 401(k) and IRA withdrawals?
Distributions from self-funded IRAs, 401(k) elective deferrals, 403(b), 457 plans and the federal TSP are taxable; employer-match portions can be excluded.
Does Hawaii tax military retirement pay?
Hawaii does not tax military pensions.
Does Hawaii have an estate or inheritance tax?
Hawaii taxes estates above $5.49 million, at rates from 10% to 20%.
Sources (last verified 2026)
- Tax Information Release No. 96-5: Taxation of Pensions — Hawaii Department of Taxation (1996-08-14)
- Hawai'i State Taxes: 2026 Tax Season — AARP (2026-05-26)
- Hawaii Retirement Taxes — Taxstra (2026)
Educational content only, not tax, legal or investment advice. Plans and tax laws change; confirm details with your employer's plan documents or your state revenue department. Smart Financial Lifestyle is not affiliated with any employer named on this site.