Pennsylvania retirement taxes in 2026: what retirees pay
Pennsylvania taxes income at a flat 3.07% in 2026. Three example retirees, worked through Pennsylvania's rules.
Monte Climb3 min readPennsylvania has a flat income tax, but for many retirees the more important fact is what it leaves out. Social Security isn't taxed here. Neither is income from a pension or a retirement account. That means the money many people live on after they stop working may never show up on a Pennsylvania return. There is one exception the facts point to. An IRA withdrawal taken before the age when early withdrawals stop applying is taxed. So when you start drawing on your savings matters as much as how much you draw.
Pennsylvania retirement taxes at a glance (2026)
Pennsylvania's income tax rate for 2026
Pennsylvania taxes income at a flat 3.07% 1.
How Pennsylvania treats retirement income
Pennsylvania does not tax pension or retirement-account income. An IRA withdrawal taken before 59½ is taxed. 3
What three retirees would pay in Pennsylvania
These are estimates from Monte Climb's planner on 2026 law, for three example households. They start, as the app does, from federal taxable income: the 2026 standard deduction plus the extra amount at 65 4, the taxable part of Social Security 5 and the senior deduction 6. Those federal deductions are already taken off, and most states allow less of their own, so Pennsylvania's real bill can be higher than shown.
| Single, 67 | Couple, both 67 | Couple, both 62 | |
|---|---|---|---|
| Social Security | $24,000 | $42,000 | $0 |
| Pension | $0 | $24,000 | $0 |
| IRA withdrawals | $30,000 | $36,000 | $70,000 |
| Interest and dividends | $0 | $4,000 | $6,000 |
| Federal taxable income | $17,150 | $52,200 | $43,800 |
| Pennsylvania subtractions | $41,300 | $95,700 | $70,000 |
| Income Pennsylvania taxes | $0 | $0 | $0 |
| Pennsylvania tax | $0 | $0 | $0 |
| Share of total income | 0% | 0% | 0% |
- A single retiree, 67 with $54,000 of income would owe about $0 to Pennsylvania, after $30,000 of retirement income is excluded and $11,300 of taxable Social Security is left out.
- A married couple, both 67 with $106,000 of income would owe about $0 to Pennsylvania, after $60,000 of retirement income is excluded and $35,700 of taxable Social Security is left out.
- A married couple, both 62, before Social Security with $76,000 of income would owe about $0 to Pennsylvania, after $70,000 of retirement income is excluded.
The same couple next door
The married couple, both 67, with $106,000 of income, in Pennsylvania and the states around it:
| State | State tax |
|---|---|
| Pennsylvania | $0 |
| Delaware | $0 |
| Maryland | $1,246 |
| New Jersey | $0 |
| New York | $0 |
| Ohio | $0 |
| West Virginia | $394 |
Every figure here starts from federal taxable income, as above, so a state whose own deductions are smaller can tax more than shown.
What these estimates leave out
- Pennsylvania's own standard deduction, exemptions and credits: the estimate starts from federal taxable income instead, which takes off the larger federal deductions.
- City income taxes, and capital gains rules a state applies apart from its rate.
- Rules for military and public-employee pensions that some states treat separately.
What this means for your plan
For a Pennsylvania retiree, the question is less about rates and more about timing. Social Security, pension income and retirement-account withdrawals taken at the usual age fall outside the state's tax, so what's left to tax is mostly other income and any early IRA withdrawals. If your plan includes stopping work early and leaning on an IRA before that point, the picture changes. Monte Climb runs Pennsylvania's rules on your own plan, so you can see how your withdrawal timing plays out year by year.
Sources
- Pennsylvania income tax for 2026 (Monte Climb's audit grades it high)
- Pennsylvania: a further official source for the 2026 tables
- Pennsylvania's retirement-income rule: 2025 PA-40 instructions
- Rev. Proc. 2025-32 §4.14(1) and §4.14(3): the 2026 standard deduction and the additional amount at 65
- IRC §86 and IRS Publication 915: how much of Social Security is taxable (thresholds set by statute, not indexed)
- P.L. 119-21 (One Big Beautiful Bill Act) §70103: the $6,000 deduction for each person 65 or older, 2025–2028
Figures computed by code from Monte Climb's 2026 state tables (snapshot f024e17). An illustration, not tax advice.
Frequently asked questions
Does Pennsylvania tax Social Security?
In 2026, Social Security is not taxed in Pennsylvania.
What is Pennsylvania's income tax rate in 2026?
Pennsylvania has a flat 3.07% for 2026.
How much state tax would a retired couple pay in Pennsylvania?
A married couple, both 67, with $106,000 of Social Security, pension and IRA income would owe about $0 to Pennsylvania in 2026, by Monte Climb's estimate.
Part of Retirement taxes by state (2026).
When can you actually retire?
Three numbers. We run your savings through 1,000 simulated futures, the same engine behind the app, and give you one clear answer.
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