Social Security: 40 States Where You’ll Feel the Biggest Increase This Year

Jordan Rosenfeld
zimmytws / Getty Images/iStockphoto
zimmytws / Getty Images/iStockphoto

This year, 2024, brought increases to Social Security and Supplemental Security Income (SSI) for millions of Americans through the annual cost of living adjustment (COLA) that increases benefits to account for inflation.

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Social Security is a federal program, so while people in every state receive the same adjustment, some states still tax Social Security income, which makes those beneficiaries in the states that don’t tax them feel as though they’re getting more of an increase than others.

Here’s a look at the average benefits and which states will feel like they’re seeing more of an increase than others due to the way benefits are taxed.

Estimated Payments for 2024

Since the increase was only 3.2%, compared to the 8.7% COLA in 2023 (the highest in forty years), this may have felt slim in contrast to many beneficiaries.

More than 66 million beneficiaries receive Social Security benefits and around 7.5 million receive SSI.

The average monthly benefits for 2024 are as follows:

  • All retired workers: $1,907 (up from $1,848)

  • Aged couple, both receiving benefits: $3,033 (up from $2,939)

  • Widowed mother and two children: $3,653 (up from $3,540)

  • Aged widow(er) alone: $1,773 (up from $1,718)

  • Disabled worker, spouse and one or more children: $2,720 (up from $2,636 )

  • All disabled workers $1,537: (up from $1,489)

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States That Tax Social Security

Taxing Social Security benefits can really reduce the COLA and make it feel like you just aren’t getting much of an increase.

The states that do this are: Colorado, Connecticut, Kansas, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont and West Virginia. As GOBankingRates previously reported, a state with an effective rate of 5% is taking $1,500 of $30,000 in benefits — not an insignificant amount if you’re living on a fixed income.

States That Don’t Tax Social Security

The states that don’t tax Social Security and where you’ll feel that increase the most, are:

  • Alabama

  • Alaska

  • Arizona

  • Arkansas

  • California

  • Delaware

  • Florida

  • Georgia

  • Hawaii

  • Idaho

  • Illinois

  • Indiana

  • Iowa

  • Kentucky

  • Louisiana

  • Maine

  • Maryland

  • Massachusetts

  • Michigan

  • Mississippi

  • Missouri

  • Nebraska

  • Nevada

  • New Hampshire

  • New Jersey

  • New York

  • North Carolina

  • North Dakota

  • Ohio

  • Oklahoma

  • Oregon

  • Pennsylvania

  • South Carolina

  • South Dakota

  • Tennessee

  • Texas

  • Virginia

  • Washington

  • Wisconsin

  • Wyoming

Changes To Earnings Limits

A few other changes have taken place this year related to Social Security and SSI benefits for those who continue to work while drawing their benefits.

For one, the Social Security Administration increased the earnings limit for workers who are younger than the “full” retirement age to $22,320. In other words, SSA deducts $1 from benefits for each $2 earned over $22,320.

For people who reach their “full” retirement age in 2024, this earnings limit increased to $59,520. SSA deducts $1 from benefits for each $3 earned over $59,520 until the month the worker hits “full” retirement age.

For those who are “full” retirement age, there is no limit on earnings.

While the state you live in doesn’t matter in terms of how big your COLA is, whether you get taxed or not will make your benefits more or less robust this year.

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This article originally appeared on GOBankingRates.com: Social Security: 40 States Where You’ll Feel the Biggest Increase This Year

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