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Pennsylvania has been recognized in Kiplinger’s “10 Most Tax-Friendly States for Retirees” in part due to its retirement-friendly tax benefits.

Flat personal income tax

Pennsylvania’s personal income tax is a flat 3.07%. Unlike most states, the state does not have a graduated income tax (for example, compared to ranges of up to 5.75% in Maryland, 6.5% in West Virginia, 10.75% in New Jersey and 10.9% in New York). Interest and dividends are taxed at a flat 3.07% as well.

Tax-exempt retirement income

With its income-tax exclusions, Pennsylvania is one of the most generous states to retirees. The following retirement income sources are exempt from the state’s income tax—even if earned in another state:

• Social Security benefits
• Public or private pension
• Distributions from 401(k) plans, IRAs, deferred-compensation plans or other retirement accounts

Here at Country Meadows, we provide our residents with everything they need for Independent Living, Assisted Living or Personal Care, specialized Memory Care or Rehabilitative Services—even Skilled Nursing Care at our Bethlehem campus—all on a vibrant campus with activities, social events, day trips and personalized services. Contact us today to set up a visit or to learn more.

Source: Federation of Tax Administration, January 2024