Does Washington Tax Social Security and Retirement Income?

Washington has no income tax, so Social Security is not taxed

Washington does not tax Social Security benefits because it has no individual income tax. No state return is filed for wages, benefits or retirement income, and only the federal rules decide how much of a benefit is taxed. (Washington Department of Revenue: Income tax (no current individual income tax; 9.9% tax from January 1, 2028))

A new tax arrives in 2028, but it is aimed at very high incomes. Beginning January 1, 2028, a 9.9% tax applies to individuals and married couples filing jointly whose annual adjusted gross income exceeds $1 million, with the first returns due in April 2029. A retired household below that level will still have nothing to file. (Washington Department of Revenue: Income tax (no current individual income tax; 9.9% tax from January 1, 2028))

The federal government is a separate matter. Up to 85% of a benefit can be taxed on a federal return once other income passes fixed thresholds, wherever you live. Our taxable Social Security calculator shows how much of yours is counted.

No Washington tax on any pension in 2026

Private pensions, state and local government pensions, federal civil service annuities and military retirement pay are all untaxed by Washington in 2026, because the state has no individual income tax. (Washington Department of Revenue: Income tax (no current individual income tax; 9.9% tax from January 1, 2028))

A pension earned in another state is protected too. Once the retiree lives in Washington, federal law (4 U.S.C. 114) bars the former state from imposing income tax on that retirement income. (4 U.S.C. 114, Limitation on State income taxation of certain pension income)

The 2028 income tax does not carve pensions out. The act that created it amends the public pension statutes to say their long-standing exemption from state and local taxes does not apply to the new tax, and its base starts from federal adjusted gross income, which includes taxable pension income. In practice this matters only in a year when income passes $1 million. (Engrossed Substitute Senate Bill 6346, Chapter 238, Laws of 2026 (income tax; Part VIII, application to public pensions))

IRA and 401(k) withdrawals and Roth conversions carry no state tax in 2026

Withdrawals from traditional IRAs and 401(k) plans, required minimum distributions and Roth conversions are taxed only by the federal government for a Washington resident in 2026. Trading inside a retirement account is also outside the capital gains excise tax: the Department of Revenue lists 401(k) plans, tax-sheltered annuities, deferred compensation plans, IRAs, Roth IRAs and employer defined contribution and defined benefit plans as exempt. (Washington Department of Revenue: Frequently asked questions about Washington’s capital gains tax)

From 2028 the calculation changes for the largest conversions only. The Department of Revenue’s summary of the act describes a base that begins with federal adjusted gross income and a standard deduction of $1 million per individual, with spouses limited to $1 million combined whether they file jointly or separately. Conversion income is part of federal adjusted gross income, so a conversion that pushes a household past that line in 2028 or later would add to the amount taxed at 9.9%; one completed in 2026 or 2027 falls before the tax begins. (Washington Department of Revenue, Summary of 2026 Legislation (ESSB 6346, ESB 6347, HB 1376, ESSB 6162))

To size a conversion against federal brackets and Medicare surcharges, see the Roth conversion calculator; for required withdrawals, the RMD calculator.

Interest and dividends are untaxed; large long-term capital gains are not

Washington does not tax interest or dividends. Since 2022 it has imposed an excise tax on the sale or exchange of long-term capital assets such as stocks, bonds and business interests. Only individuals pay it, including on gains that pass through from partnerships, LLCs, S corporations and grantor trusts, and only on gains allocated to Washington. (Washington Department of Revenue: Capital gains tax (who pays, filing, due dates))

The standard deduction is $290,000 for 2026, up from $278,000 for 2025, and it is indexed to inflation each year. A married couple shares one deduction whether they file jointly or separately. Qualifying charitable donations above $290,000 in the year can be deducted as well, up to a maximum deduction of $116,000 for 2026. (Washington Department of Revenue: Do you owe capital gains tax? (domicile questions; standard deduction and charitable deduction amounts by year))

The tax does not apply to real estate, whether a home, a rental or land, and whoever owns it. Also exempt are assets held in 401(k), 403(b) and 457(b) plans, IRAs, Roth IRAs and employer pension plans, depreciable business property, timber and timberland, certain livestock and commercial fishing privileges. (RCW 82.87.050, Capital gains excise tax: exemptions)

Mutual fund capital gain distributions count toward the total, because they appear on federal Schedule D, while ordinary interest and dividend distributions do not. Short-term losses cannot offset long-term gains, and losses realized before 2022 cannot be carried in. Gain excluded federally as qualified small business stock under section 1202 is excluded in Washington too, but federal opportunity zone deferral is ignored. (Washington Department of Revenue: Frequently asked questions about Washington’s capital gains tax)

Only people who owe the tax file a return. It is filed electronically through the Department of Revenue’s My DOR system with a copy of the federal return, and both the return and the payment are due on the federal due date, normally April 15. A filing extension requires a federal extension and does not extend the time to pay. Paying less than 80% of the tax by the due date brings a substantial underpayment penalty. (Washington Department of Revenue: Capital gains tax (who pays, filing, due dates))

There are no income tax brackets in 2026. The capital gains excise tax has two tiers, in effect since tax year 2025: 7% on the first $1,000,000 of taxable Washington capital gains and 9.9% on anything above that, the higher rate being the 7% tax plus an additional 2.9%. Taxable gains are what remain after exemptions, the standard deduction and the other deductions. (Washington Department of Revenue, Special Notice: New tiered rates for Washington’s capital gains tax (June 30, 2025))

To put numbers on it: a couple realizing $500,000 of long-term stock gains in 2026 would subtract $290,000 and owe 7% of $210,000, or $14,700. A couple realizing $1,500,000 would have $1,210,000 of taxable gains and owe $70,000 on the first $1,000,000 plus $20,790 on the rest, $90,790 in total. (Washington Department of Revenue: Do you owe capital gains tax? (domicile questions; standard deduction and charitable deduction amounts by year))

With no income tax, Washington’s age-based relief is all in property tax. The main program is the exemption for senior citizens and people with disabilities: the owner must be at least 61 by December 31 of the year before the tax is due, or unable to work because of a disability, must own and live in the home for more than six months of the year, and must have combined disposable income under the county threshold. (Washington Department of Revenue, Property Tax Exemption for Senior Citizens and People with Disabilities (publication PT0017))

A separate deferral program is open from age 60 at a somewhat higher income limit. The state pays the property tax, places a lien on the home and charges interest at 5% a year, and the balance is repaid when the home is sold or transferred, the owner moves out or dies. A surviving spouse who is at least 57 and qualifies can continue the deferral by applying within 90 days. (Washington Department of Revenue, Property Tax Deferral for Senior Citizens and People with Disabilities (publication PT0018))

The same three households appear on every state page, so the figures can be compared across states. Each is a full-year resident taking the standard deduction, with no dependents. The figures are state income tax only: any county, city or school district income tax is described on this page but not added in. Pension income is from a private employer, and IRA figures are taxable withdrawals from traditional accounts. The state tax is our calculation from Washington's published 2026 rules; it is an illustration, not a return.

These households also owe federal income tax, which is the same wherever they live. The tax bracket calculator and the guide to taxes in retirement cover that side.

Property tax is administered by county assessors and treasurers, and assessors are required to value property at 100% of its true and fair market value. The Department of Revenue describes property tax as about 30% of all state and local taxes in Washington. (Washington Department of Revenue: Property tax (administration and valuation))

Tax Foundation figures drawn from Census data put Washington property taxes at 0.75% of owner-occupied home value in 2024, 30th among the states. On a $700,000 home that average works out to about $5,250 a year; actual bills vary widely by county and levy district. (Tax Foundation, Property Taxes by State and County, 2026 (comparative figures from Census ACS data))

The senior exemption has three income tiers. For taxes due in 2026, every participant is exempt from voter-approved excess levies and from Part 2 of the state school levy, and the home’s taxable value is frozen in the first year of qualifying. Owners under the middle threshold are also exempt from regular levies on the greater of $50,000 or 35% of value, up to $70,000; owners under the lowest threshold are exempt on the greater of $60,000 or 60% of value. (Washington Department of Revenue, Property Tax Exemption for Senior Citizens and People with Disabilities (publication PT0017))

The thresholds are set county by county from median household income. For taxes due in 2024 through 2026 the three tiers are $60,000, $72,000 and $84,000 in King County, $46,000, $55,000 and $64,000 in Pierce County and $36,000, $43,000 and $50,000 in Spokane County. The deferral thresholds for the same counties are $88,998, $68,319 and $53,014. (Washington Department of Revenue, Income Thresholds for the Senior Citizen and Disabled Persons Exemption and Deferral, tax years 2024-2026)

Combined disposable income is broader than federal taxable income. It counts Social Security, pensions, the taxable part of IRA distributions, interest, dividends and capital gains, whether or not they are federally taxable, for the applicant, a spouse or domestic partner and any co-owner living in the home. Out-of-pocket costs for Medicare premiums, Medigap and long-term care insurance, prescription drugs, and nursing home, assisted living or in-home care are subtracted. (Washington Department of Revenue, Property Tax Exemption for Senior Citizens and People with Disabilities (publication PT0017))

The program becomes more generous for taxes due in 2027 under Engrossed Substitute Senate Bill 6162. The tiers rise to 60%, 70% and 80% of county median income, participants become exempt from the whole state school levy, and the regular-levy exemptions increase to the greater of $80,000 or 80% of value for the lowest tier and the greater of $70,000 or 45% of value, capped at $200,000, for the middle tier. Applicants may also subtract a flat $7,500 each for themselves and a spouse in place of itemized medical costs. (Washington Department of Revenue, Special Notice: Changes to property tax relief programs and state school levy (ESSB 6162, June 10, 2026))

The published 2027 through 2029 thresholds are $76,000, $89,000 and $101,000 in King County, $64,000, $74,000 and $85,000 in Pierce County and $56,000, $65,000 and $74,000 in Spokane County. Deferral thresholds move to 90% of county median income: $113,512 in King County and $83,136 in Spokane County. (Washington Department of Revenue, Income Thresholds for the Senior Citizen and Disabled Persons Exemption and Deferral, tax years 2027-2029)

Retail sales tax is Washington’s principal source of tax revenue. The state rate is 6.5% and each city or county adds a local rate; the tax is charged at the rate where the buyer receives the goods or service. (Washington Department of Revenue: Retail sales tax (6.5% state rate, local rates))

The Tax Foundation puts the average combined state and local rate at 9.51% as of January 2026, third highest in the country. (Tax Foundation, State and Local Sales Tax Rates, 2026 (comparative figures))

Food and food ingredients bought as groceries are exempt. The exemption does not cover prepared food, soft drinks, bottled water, dietary supplements or alcoholic beverages. (RCW 82.08.0293, Retail sales tax exemption for food and food ingredients)

Drugs for human use dispensed under a prescription are exempt from sales tax. (RCW 82.08.0281, Retail sales tax exemption for prescription drugs)

Since October 1, 2025, sales tax has also applied to a group of services that were previously untaxed, among them advertising services, information technology support and training, custom website development, custom software, live presentations such as workshops and webinars, security and investigation services, and temporary staffing. Most are bought by businesses, but a household can meet the tax on a live online workshop or a home security service. (Washington Department of Revenue: Services newly subject to retail sales tax (ESSB 5814, effective October 1, 2025))

Washington taxes estates and has no inheritance tax, so heirs owe nothing on what they receive. The exclusion, which is also the filing threshold, is $3,076,000 for deaths from January 1 through June 30, 2026 and $3,000,000 for deaths on or after July 1, 2026. The Department of Revenue notes that the $3,000,000 figure is not set to rise with inflation. (Washington Department of Revenue: Estate tax (2026 filing threshold and exclusion amounts))

Two rate tables apply during 2026. For deaths from July 1, 2025 through June 30, 2026 the rates run from 10% on the first $1,000,000 of taxable estate to 35% above $9,000,000. For deaths on or after July 1, 2026 the earlier table returns: 10% on the first $1,000,000, 14% on the next $1,000,000, then 15%, 16%, 18%, 19% and 19.5%, reaching 20% above $9,000,000. The rates apply to the estate after deductions and after the exclusion. (Washington Department of Revenue: Estate tax tables (exclusion amounts and Table W rates by date of death))

Washington does not recognize portability, so a surviving spouse cannot use a deceased spouse’s unused exclusion. Bequests to a spouse and to charity are deductible, and a qualified terminable interest property (QTIP) election is available. A return is due nine months after death whenever the gross estate exceeds the threshold, even if no tax is owed, and it is required of non-residents who own real estate or tangible property in the state. (Washington Department of Revenue: Estate tax FAQ (portability, community property, non-residents, out-of-state property))

Washington is a community property state. Most property acquired during a marriage belongs equally to both spouses, and at the first death the whole of a community asset, including the survivor’s half, generally takes a new federal tax basis equal to fair market value, provided at least half of it is included in the deceased spouse’s estate. (IRS Publication 555, Community Property)

The federal estate tax applies in every state. The estate tax calculator estimates both the federal tax and any state tax.

Estate tax: Engrossed Senate Bill 6347, passed in 2026, undid the rate increase that had applied since July 1, 2025. For deaths on or after July 1, 2026 the top rate is 20% rather than 35%, and the exclusion is a flat $3,000,000. (Engrossed Senate Bill 6347, Laws of 2026 (estate tax rates and exclusion for deaths on or after July 1, 2026))

Income tax: Engrossed Substitute Senate Bill 6346 created the 9.9% tax on income above $1 million for income earned in 2028 and later, with credits for capital gains excise tax and for income tax paid to other states. (Washington Department of Revenue, Summary of 2026 Legislation (ESSB 6346, ESB 6347, HB 1376, ESSB 6162))

Initiative Measure 645 on the November 3, 2026 ballot asked voters to repeal that tax and prohibit taxes on individual income. With all 39 counties reporting but the count not yet final or certified when this page was reviewed, the Secretary of State’s tally stood at 42.02% yes and 57.98% no, which would leave the tax in place. (Washington Secretary of State, November 3, 2026 General Election results (Initiative Measure 645; not yet certified))

Capital gains: a 2026 law lets taxpayers prepay the excise tax up to six months before it is due. For tax year 2026, payments can be made from October 15, 2026 toward the April 15, 2027 due date. Quarterly estimated payments are still not required. (Washington Department of Revenue, Special Notice: Prepayment of capital gains tax (August 3, 2026))

Sales tax: the same 2026 act partially repeals the 2025 extension of sales tax to services, but not until January 1, 2029, and it exempts over-the-counter drugs, grooming and hygiene products and diapers. The Department of Revenue notes that many of the act’s relief provisions do not take effect until January 1, 2029. (Washington Department of Revenue, Summary of 2026 Legislation (ESSB 6346, ESB 6347, HB 1376, ESSB 6162))

WA Cares: benefits from the state long-term care insurance program became available on July 1, 2026. Applicants must meet a contribution requirement and a care-needs requirement, and an approved beneficiary can draw up to $36,500 of covered services and supports. (WA Cares Fund: WA Cares Fund benefits now available (July 1, 2026))

Because there is no income tax, residency matters in Washington mainly for the capital gains excise tax and the estate tax. Gains on intangible assets such as stocks and bonds are allocated to Washington if the seller is domiciled there at the time of the sale. The Department of Revenue’s screening questions also ask whether the person lived in Washington for more than 183 days in the year. (Washington Department of Revenue: Do you owe capital gains tax? (domicile questions; standard deduction and charitable deduction amounts by year))

The capital gains rule treats a person domiciled in Washington as a resident in most cases, and also anyone not domiciled there who kept a place of abode in the state and was physically present for more than 183 days in the year, counting any part of a day. A credit may be available for income or excise tax legally imposed by another jurisdiction and paid on the same gain. (WAC 458-20-301, Capital gains excise tax: definitions, deductions, exemptions, and allocation of gains and losses)

For someone arriving from an income-tax state, 4 U.S.C. 114 reserves pensions, IRA distributions and 401(k) income to the state of residence, so the former state cannot tax retirement income received after a completed move. It can still tax income arising within its borders, such as rent or the gain on property located there, and a part-year return is normally due for the year of the move. (4 U.S.C. 114, Limitation on State income taxation of certain pension income)

For the estate tax, a Washington-domiciled decedent’s return reports all property wherever located, and the tax is then apportioned so that real estate and tangible property outside Washington are not taxed by the state. For someone domiciled elsewhere, only Washington real estate and tangible property are in the Washington share. (Washington Department of Revenue: Estate tax FAQ (portability, community property, non-residents, out-of-state property))