Social Security retirement benefit checks work the same way in every State in the United States. Any retiree living in one of these states can cash his or her check on the same day as everyone else. By following the calendar of days we can know when we will receive the benefit.
So every month any retiree with an accepted benefit will receive one of these checks. The only thing you need to check is whether you will cash the check on the second, third or fourth Wednesday of the month. Fortunately, the Social Security Administration always announces the schedule well in advance so we can keep track of our finances.
But there are certain items that don’t have to do directly with the Social Security Administration but do affect the retirement check. We are talking about taxes, and it is not the same to collect the Social Security benefit in all States. Each state has its own rules regarding Social Security taxes and living in some states may cause us to have a little less money when we file our taxes with the IRS.
States that collect Social Security taxes
When it comes to Social Security retirement checks, it should be clear that we always have to pay federal taxes. This depends on a number of factors, but as a general rule we always have to file our taxes. On the other hand, when it comes to state taxes, things change a bit.
Not all states require us to pay state taxes. This means that depending on the State in which we live we must pay extra taxes from our Social Security check or not. These are the states that require us to pay taxes on our retirement check:
- Colorado
- Connecticut
- Kansas
- Minnesota
- Missouri
- Montana
- Nebraska
- New Mexico
- Rhode Island
- Utah
- Vermont
- West Virginia
However, this does not mean that all retirees who receive a Social Security check in these states will have to pay taxes on their annual tax return.
Since every American taxpayer is totally different, you may find that some will have to pay both state and federal taxes and others may not have to pay either.
The bottom line is that the important thing to do to avoid tax problems is to never forget to file a tax return. When you start collecting your monthly Social Security check, you should also include it as a source of income. It is the best way to pay your mandatory taxes.