Ohio · 55+ Tax Guide
How Ohio Taxes Retirement Income
Good news and a real catch: Ohio leaves Social Security and military retirement alone — but it taxes your pension, IRA, and 401(k) withdrawals as ordinary income. Here is the full picture.
What Ohio does NOT tax
Two big exemptions work in a retiree’s favor:
Social Security — fully exempt
Ohio does not tax Social Security benefits at all. Whatever portion the federal government taxes, Ohio excludes from your state return.
Military retirement pay — fully exempt
Ohio fully exempts military retirement income. Combined with the disabled-veteran homestead exemption, this makes Columbus a genuinely tax-friendly landing spot for military retirees.
The catch most movers miss: Ohio does tax pension income, and IRA, 401(k), and other tax-deferred withdrawals, as ordinary income. If your retirement is funded mainly by a pension and 401(k) distributions — not Social Security — Ohio is not a no-tax state for you. This is the opposite of the “Ohio doesn’t tax retirement” impression many buyers arrive with.
The rate: flat 2.75% in 2026
Ohio has been flattening its income tax. The top rate was 3.125% in 2025, and the state is moving to a flat 2.75% rate in 2026 on taxable income above roughly $26,050; income below that threshold is effectively untaxed. So your pension and 401(k) withdrawals above the threshold are taxed at 2.75% — low compared with many states, but not zero.
The retirement income credit is tiny
Ohio offers a “retirement income credit,” but do not count on it for much: it maxes out at just $200, and phases down as income rises. It is a rounding error against a real pension, not a meaningful shelter. Treat it as a small bonus, not a planning tool.
Worked example: $60,000 of retirement income
| Income source | Amount | Ohio tax treatment |
|---|---|---|
| Social Security | $24,000 | Exempt |
| Pension | $20,000 | Taxable |
| 401(k) withdrawals | $16,000 | Taxable |
| Ohio-taxable income | ~$36,000 | $24k excluded |
At the flat 2.75% on the portion above the ~$26,050 threshold, the Ohio income tax here is modest — on the order of a few hundred dollars — far less than the property tax on a Courtyards home. For most Columbus retirees, property tax, not income tax, is the bigger number.
The takeaway for relocation math: if you are comparing Ohio to a true no-income-tax state, the income-tax difference on retirement income is real but usually small at the flat 2.75%. The property-tax difference between communities — and especially Franklin vs. Delaware County — will usually swamp it. Plan around the property tax first.
Moving from another state?
We will help you compare the all-in tax picture — income and property — against where you live now.
Get the real numbersTax rates, brackets, thresholds, and credits change and depend on your full financial picture. Confirm current figures with the Ohio Department of Taxation and consult a tax professional. This is general information, not tax advice.