Tennessee retirement taxes at a glance (2026)
| State income tax | No state income taxTennessee has no individual income tax; the Hall tax on interest and dividends was repealed for tax periods beginning January 1, 2021. |
|---|---|
| Social Security | Not taxedSocial Security is not taxed. |
| Pensions | Not taxedPensions are not taxed. |
| 401(k) and IRA withdrawals | Not taxedIRA and 401(k) withdrawals are not taxed. |
| Government pensions | Not taxedGovernment pensions are not taxed. |
| Military retirement pay | Not taxedMilitary retirement pay is not taxed. |
| Estate tax | No |
| Inheritance tax | NoTennessee's inheritance tax does not apply to deaths after December 31, 2015. |
| Property tax help for seniors | The state Property Tax Relief program reimburses part of the property tax for homeowners age 65+ with 2025 household income of $38,470 or less, on up to $33,600 of market value; many counties also offer a tax freeze. |
| Sales tax | State sales tax is 7% (4% on groceries) plus local tax up to 2.75%, for one of the highest combined rates in the country. |
Recent changes and good to know
- The Hall tax on investment income was fully repealed starting in 2021.
How to lower your retirement taxes in Tennessee
- Mix your income sources. Roth IRA withdrawals are tax-free at the federal level and generally in Tennessee 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, Texas, Washington, Wyoming.
Frequently asked questions
Does Tennessee tax retirement income?
No: Tennessee has no income tax, so it does not tax any retirement income.
Does Tennessee tax Social Security?
Social Security is not taxed.
Does Tennessee tax pensions?
Pensions are not taxed.
Does Tennessee tax 401(k) and IRA withdrawals?
IRA and 401(k) withdrawals are not taxed.
Does Tennessee tax military retirement pay?
Military retirement pay is not taxed.
Does Tennessee have an estate or inheritance tax?
Tennessee's inheritance tax does not apply to deaths after December 31, 2015.
Sources (last verified 2026)
- State Individual Income Tax Rates and Brackets, 2026 — Tax Foundation (2026)
- Tennessee retirement income tax guide — Brevy Care (2026)
- Tennessee 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.