- Florida levies no personal income tax, so no retirement income category is taxed at state level — Social Security, pensions, annuity payments, 401(k) and IRA withdrawals, capital gains, dividends and interest.
- The mechanism is constitutional: Article VII, Section 5(a) caps any state tax on a natural person's income at the amount creditable against a similar federal tax, and no such federal credit exists.
- Federal tax still applies to all of it. Up to 85% of Social Security benefits remain federally taxable, and the 2025 senior deduction does not change that.
- IRMAA surcharges on Medicare premiums are driven by federal MAGI, which annuity and IRA withdrawals feed regardless of where you live.
- Florida charges plenty of other things: 6% sales tax plus county surtaxes, and property tax that homestead and Save Our Homes only partly offset.
The short answer is no, in every category, with no exceptions worth caveating. That takes one paragraph. The rest of this page is the part that actually helps: what Florida residency does not protect you from, and what it is worth in dollars against the state you are leaving.
The short answer: no, on every category
Florida does not tax:
- Social Security benefits — no state tax, any amount
- Pension income — public and private
- Annuity payments — immediate, deferred, qualified, non-qualified
- 401(k), 403(b) and IRA withdrawals — including Roth conversions
- Capital gains, dividends and interest — no separate state capital gains tax exists
There is no retirement-income category that Florida taxes, because there is no personal income tax for a category to sit inside.
Why Florida can't tax it
This is not a policy choice a legislature could reverse next session. Article VII, Section 5(a) of the Florida Constitution caps any state tax on a natural person's income at the amount creditable against a similar federal tax. No such federal credit exists, so the permitted amount is zero.
One precision worth having, because most pages get it wrong: the constitution does not ban income tax outright. Section 5(b) expressly permits a corporate income tax, which Florida levies at 5.5%. The ban is specific to natural persons, and changing it would require a constitutional amendment — a 60% voter threshold, and arguably two-thirds if the amendment itself imposed a new state tax.
What Florida does not save you from
This is the section that matters, and the one most pages skip entirely. People move expecting a clean sweep and get blindsided in April.
Federal income tax on every withdrawal. A traditional IRA distribution is ordinary income to the IRS in Miami exactly as it was in Newark. Florida removes a state layer; the federal layer is untouched. For most retirees the federal bill is the larger of the two to begin with.
Federal tax on up to 85% of Social Security. Depending on provisional income — adjusted gross income, plus tax-exempt interest, plus half your benefits — up to 85% of benefits are federally taxable. The 85% tier begins above $34,000 of provisional income filing single, $44,000 married filing jointly.
A specific correction, because it is the most common error in current retirement content: the 2025 federal senior deduction did not make Social Security tax-free. It is a deduction of $6,000 per qualifying taxpayer aged 65 or older, available for 2025 through 2028 and phasing out above $75,000 of modified AGI single and $150,000 joint. It reduces taxable income. It does not exempt benefits, and any page implying otherwise is going to cost someone an estimated payment.
IRMAA surcharges on Medicare. Income-Related Monthly Adjustment Amounts raise Part B and Part D premiums for higher-income beneficiaries, based on federal MAGI from two years prior. Annuity withdrawals, IRA distributions and Roth conversions all feed that figure, and Florida residency does nothing to it. A large one-time conversion can lift premiums two years later — worth modelling before you execute, not after.
Federal estate tax. Florida has no state estate or inheritance tax, which is genuinely valuable. The federal estate tax is a separate regime with its own exemption and it applies to Florida residents identically.
What Florida residency is actually worth
The saving is arithmetic, not a slogan: your annual state-taxable retirement income, multiplied by your departure state's effective rate on that income. Do it with your own numbers.
Two things swing the result more than people expect. First, the departure state's treatment: several states already exempt Social Security, and some exempt a slice of pension or IRA income, so the delta may be far smaller than the headline rate implies. Second, one-time events — a Roth conversion, a large annuitization, a business sale — are where the difference becomes material, because they concentrate income into a single year that a high-tax state would have taxed heavily. Our planning guide for the move covers sequencing those events around the residency date, which is where the real money is.
The taxes Florida does charge
Sales tax: 6% state, plus county discretionary surtaxes that vary by county and often apply only to the first portion of a single item's price. Florida funds itself substantially through consumption, so high spenders give some of the income-tax saving back.
Property tax. Assessed and levied locally, and the largest recurring tax most Florida retirees pay. The homestead exemption reduces assessed value on a primary residence, and the Save Our Homes cap limits annual assessment increases on homesteaded property — which is worth more the longer you stay, and which resets when you buy. Confirm current amounts with your county property appraiser rather than any published figure, including this one; Florida has homestead changes on the November 2026 ballot that would reset the numbers from January 2027.
No annual intangibles tax. Florida's annual intangible personal property tax on stocks, bonds and similar assets was repealed effective 1 January 2007. A separate nonrecurring intangible tax on notes secured by Florida real property still exists — a one-time charge at closing, not an annual levy on your portfolio. Stale content still conflates the two.
Who gains the most
The move pays best for someone with high, controllable, state-taxable income leaving a high-tax state — large IRA balances facing required distributions, a planned Roth conversion, a deferred compensation payout, or an annuitization about to begin. It pays least for someone whose income is mostly Social Security, whose departure state already exempted their pension, or who is buying an expensive Florida house and trading an income tax bill for a property tax bill.
If an annuity is part of the picture, two Florida-specific checks belong on the list before you move: whether your carrier is licensed to do business in Florida, and what Florida's guaranty association limit is against your premium, since guaranty coverage follows your state of residence rather than where you bought the contract.
General information on state and federal tax rules, not tax advice. Rates, exemptions and thresholds change, and property tax figures in particular vary by county and are subject to pending ballot measures — confirm current amounts with the Florida Department of Revenue, your county property appraiser, and a CPA before acting.
Frequently asked
Moving to Florida with an annuity in hand?
The state tax answer is simple. Sequencing withdrawals, timing an annuitization, and checking your carrier is licensed in Florida are not. Send us the contract and the plan.
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