In a significant boost for West Virginia residents, almost 500,000 recipients could see higher monthly payments for their Social Security as the state phases out its income tax on benefits.
West Virginia lawmakers are concluding the three-year plan to eliminate the tax on Social Security, allowing seniors to receive a higher payment in line with what 41 states already offer, according to Newsweek.
How will West Virginia beneficiaries benefit from the move?
The decision marks a major shift in retirement policy and is expected to deliver meaningful savings for retirees while reshaping West Virginia’s appeal as a destination for older Americans.
For years, West Virginia gradually reduced taxes on Social Security income through income thresholds and partial exemptions.
This year, Social Security income will be fully exempt regardless of income level, providing across-the-board relief to beneficiaries.
Delegate Jonathan Pinson, a Mason Republican, remarked removing the tax for seniors could amount to an extra month of groceries.
“It’s another opportunity to pay bills and to get caught up on bills. It’s an opportunity to live the life that they’ve worked all these years to prepare for” Pinson said, as reported by local news station WCHS. He added that the extra money in seniors’ pockets will help the communities they live in, as they have more money to spend.
“For every one dollar that remains local, we see that it generates about a dollar and a half of local economic activity,” Pinson said. “By allowing seniors to keep more of their money, that’s allowing communities to grow,” he added.
How much can people save under the new law?
Retirees receiving average annual benefits may see savings in the low hundreds, while higher-income filers, especially married couples, stand to save substantially more.
Previously, some retirees paid state taxes on up to 65 percent of their benefits once income thresholds were exceeded. Eliminating that tax removes an ongoing expense that compounded each year, according to MARCA.
Which other states tax Social Security payments?
States like Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah and Vermont continued to tax Social Security in 2025.