Retiring in Washington: No Income Tax, and What It Actually Costs

Washington charges nothing on retirement income. That is the line every comparison leads with, and it is true.

It is also one line of three. Property tax runs about $5,191 a year on the state's $617,990 median home, and home insurance averages $1,650. Together the three come to $6,841 a year, which places Washington 20th of 50.

A note before you start. This is general education, not tax advice. Every Washington figure comes from this site's own fifty-state income-tax dataset and its retirement tax engine, computed for a single filer aged 70 unless stated otherwise; property tax, median home price and insurance figures come from the site's core state dataset. Rates are for tax year 2026. Property tax is assessed locally in most states, so the effective rate here is a statewide figure rather than your county's.

1. What Washington takes from retirement income

Every one is $0 for one structural reason. Washington has no individual income tax, so it never draws the distinctions most states spend pages on — no exclusion amount, no age gate, no income ceiling, and no separate treatment of a government pension against a private one.

2. Why Washington charges nothing, and how durable that is

Washington has NO general personal income tax on wages, salaries, pensions, interest, or dividends, and this is not merely a policy choice: the Washington Supreme Court held in Culliton v. Chase (1933) that income is property under the state constitution's uniformity clause, which is why every subsequent attempt at a graduated income tax has failed.

The exception that makes Washington different from every other no-income-tax state: Washington levies a standalone capital gains excise tax on long-term capital gains above an annually indexed standard deduction. Treating Washington as a flat no-tax state produces a materially wrong answer for anyone selling appreciated securities in a taxable account.

That matters more than it sounds. Most state tax advantages rest on a statute, and a statute is one legislative session from changing. Several states have cut or expanded retirement exemptions in the past three years alone.

3. What Washington charges at three income levels

The same state, three retirements. All figures are for a single filer aged 70.

The row that matters is that they are identical. Washington charges nothing at any income, so unlike most states there is no level at which an exemption runs out and the bill starts climbing.

A married couple with $48,000 of Social Security and $62,000 of distributions pays $0.

4. Property tax, and why it lands harder in retirement

An effective rate of 0.8% on the state's $617,990 median home is about $5,191 a year.

For a retiree this is a harder cost than income tax, and the reason is structural: property tax is levied on the house, while retirement income falls. A bill sized to a working income arrives every year after the income has gone.

It is also assessed locally almost everywhere, so a statewide effective rate conceals real variation between counties. Treat the figure above as the state's shape rather than as your bill.

Washington does have a homestead provision, and it is the one lever on this line worth understanding.

Washington has no ad-valorem homestead exemption that reduces annual property tax bills for the general homeowner (its 'homestead exemption' — currently the greater of $125,000 or the county median home value, under RCW 6.13 — is a bankruptcy/creditor-protection exemption, unrelated to property tax). For actual property tax relief, the Department of Revenue's Property Tax Exemption Program for Senior Citizens, People Retired Due to Disability, and Veterans with Disabilities freezes the home's assessed value and exempts qualifying low-income (county-varying, roughly under $84,000-$90,000+ depending on county) senior/disabled/disabled-veteran homeowners from regular and/or excess levies; a separate deferral program lets qualifying seniors/disabled homeowners postpone paying property taxes.

Two things about homestead rules catch people out after a move. They almost always require the property to be your primary residence, which a snowbird splitting the year has to be able to demonstrate. And several states require an application to the county rather than granting it automatically — a benefit you qualify for and never claimed is worth nothing.

5. Insurance, the line nobody prices

Average home insurance in Washington: $1,650 a year — 8th cheapest of the fifty states.

This is the line almost no retirement comparison includes, and across the country it varies more than income tax does: from Hawaii's $900 to Florida's $8,375, a ninefold spread.

For a retiree it behaves like a second property tax. It rises independently of income, a fixed-income household absorbs the whole increase, and it is a condition of the mortgage if you still have one.

6. What retiring in Washington actually costs

Income tax on the typical retirement profile, plus property tax and insurance on each state's own median home. Washington is shown against its own neighbours in the ranking, and against the extremes.

Washington comes to $6,841, 20th of 50.

Income tax is 0% of that total, which is the whole point: the number everybody checks contributes nothing to the number that matters.

One large caveat, and it matters. Each row uses that state's own median home, and those differ a great deal. So this compares the typical house in each state, not the same house in each state — buying below a state's median improves its figure materially.

7. "No income tax" tells you almost nothing

Nine states charge no individual income tax. If that were what decided the cost of retiring somewhere, those nine would cluster. They span rank 1 to rank 45.

The spread is $7,707, or 2.9 times, between states whose income tax rate is identically zero.

Two different causes drive the bottom of that table. Florida is expensive on insurance, at $8,375; New Hampshire on property tax, at $8,498. Whatever "no income tax" is worth, it is not what decides the total.

8. What a Roth conversion costs in Washington

A Roth conversion costs $0 in Washington state tax, at any size.

This is the most under-used consequence of living in a state with no income tax, and it is worth more than the annual saving to many people. A conversion is taxed in the year you make it, at the rate of the state you live in that year. Convert while resident here and the state's share is zero — permanently, because the Roth balance is never taxed again.

The federal tax is unchanged and still due. Converting $50,000 adds $50,000 to federal taxable income for that year, can push you into a higher federal bracket, and raises the IRMAA determination two years later. Washington removes one of those three costs, not all of them.

The window is the years between retiring and required distributions, when income is low and there is room in the lower federal brackets. Someone who moves here at 62 and starts required distributions at 73 has about eleven of them.

9. What part-time work costs here

$20,000 of part-time work costs $0 in Washington state tax.

Worth stating because it is not true everywhere, and because part-time work in early retirement is common — it is the bridge people use to delay Social Security to 70, which raises the benefit for life.

Federal tax still applies, and if you claim Social Security before full retirement age the federal earnings test can withhold part of the benefit. Neither is a state question.

10. The order to draw your accounts in

The order you draw accounts in is worth real money, and the right order depends on the state.

In Washington the state drops out of the decision entirely, which is a simplification rather than a strategy. Order the accounts on federal grounds alone: taxable first for the capital-gains treatment, then pre-tax, then Roth last so it compounds untaxed longest.

The one state-specific move is to front-load conversions while you live here. Anything converted now is permanently free of state tax, including if you later move somewhere that taxes income.

Required minimum distributions overrule all of this from 73 onward. Once they begin you must take the calculated amount whether the order suits you or not, which is the argument for drawing down or converting the pre-tax balance in the years before.

11. Or move across the state line

For most people the real alternative to Washington is not Wyoming — it is the state on the other side of the line, near the same family, the same doctors and the same weather.

Washington is the cheapest of the group on these three lines, at $6,841. Crossing any of these borders costs money.

One thing this table cannot show is the county. Property tax is set locally, and the spread inside a single state is routinely wider than the gap between two neighbouring states. A border move to a cheaper state and an expensive county can leave you worse off.

12. If you are moving to Washington from somewhere else

The eight most populous states people leave, measured against Washington on the same three lines.

Washington is cheaper than 5 of these eight. Which means the answer genuinely depends on where you are starting from.

A move is not free, and this table does not price it. Transaction costs on both houses run to several per cent of the sale price, and at typical values that is often more than the first two or three years of the saving.

Washington charges a transfer tax on the purchase itself — 1.1%, customarily paid by the seller. On the state's $617,990 median home that is about $6,798, once, at the point of sale. Closing costs here run about 2% to 3% of the price — $12,360 to $18,540 on the median home, which is the real entry fee for the annual saving this article has been describing.

13. What Washington does not exempt you from

The federal system, entirely. This is the commonest misunderstanding about state retirement taxation, and it is worth stating plainly.

Required minimum distributions still apply. The amount is federal — your prior-year balance divided by an IRS life expectancy factor — and identical in all fifty states. A state changes what the distribution costs you, not whether you must take it.

Social Security is still federally taxable, on the federal provisional-income calculation, whatever your state does with it.

IRMAA still applies, with its two-year lag. A large conversion or distribution raises a Medicare premium two years later regardless of address.

And capital gains are still federally taxed. What Washington adds on top is a separate question from what the federal system takes.

14. Establishing that you actually live here

Any state tax advantage is worth nothing until Washington is your domicile, and the state you left may disagree about when that happened.

High-tax states audit departing residents. The question is not whether you own a home here; it is whether you genuinely abandoned the old domicile. Days spent in each state, voter registration, vehicle registration, where your doctors are and where you claim a homestead all bear on it.

The snowbird case is the risky one. Splitting the year between two states while keeping a home in both is exactly the profile a residency audit is built for. If a plan depends on the saving, count the days from the first year rather than reconstructing them afterwards.

15. Who Washington actually suits

Someone drawing down a large pre-tax balance who rents, or buys modestly. The income tax saving scales with the withdrawal; property tax and insurance attach to the house. Separating those two is the whole game.

Someone with a large pension of any kind. Washington draws no distinction between private, government and military, which several states do.

And it suits someone buying below the median, because $5,191 of property tax on the median home is the largest single line in this article.

16. What to check before you decide

Get your county's actual property tax rate, not the state average. Property tax is levied locally almost everywhere, and the spread inside a state is often wider than the spread between states.

Get a real insurance quote on a real address. $1,650 is the state average; construction, roof age and exposure move it a long way.

Work out your own income tax rather than using the profile above. $95,000 split one way is not $95,000 split another, and in Washington that makes no difference, because the answer is zero at every level.

And check what your current state actually charges you before assuming it is worse. On these three lines the ranking surprises people in both directions.

Frequently asked questions

Does Washington tax Social Security? No. Exempt. Washington has no tax on Social Security benefits because it has no general income tax, and benefits are not a capital gain, so the capital gains excise cannot reach them either.

Does Washington tax 401(k) or IRA withdrawals? Exempt, and here the second half of the answer is the one that matters. Distributions from a 401(k), 403(b), or traditional IRA are untaxed by Washington because there is no general income tax. Separately and importantly, retirement account assets are expressly exempt from Washington's capital gains excise tax — gains realized inside a qualified retirement account do not enter the excise base at all, no matter how large. The excise reaches gains realized in a taxable brokerage account, not gains inside an IRA or 401(k).

What about pensions — private, government, or military? A $50,000 pension costs $0 if private, $0 if a government pension, and $0 if military retired pay.

What does retiring in Washington actually cost? Income tax of $0 on the typical profile, plus about $5,191 of property tax and $1,650 of insurance on the median home — $6,841, which is 20th of 50.

Is Washington a cheap state to retire in? On these three lines it ranks 20th of 50. Whether that makes it cheap for you depends far more on the house than on the tax code.

What does a Roth conversion cost in Washington? An extra $0 in state tax on $50,000 converted, and $0 on $100,000. The federal tax on the conversion is unchanged and still due.

Does part-time work get taxed differently from my 401(k) withdrawals? No. Washington taxes neither, so both cost $0 at the state level. Federal tax still applies to both.

Would a neighbouring state be cheaper than Washington? No — Washington is the cheapest of itself and its neighbours on these three lines, at $6,841.

Do required minimum distributions change if I move here? No. The required amount is a federal calculation and identical in every state. What changes is what the distribution costs once taken.

Does this article include local income tax? No local income tax applies to retirement income in Washington on the figures used here.

Will Washington's treatment still apply in ten years? State legislatures revise retirement taxation regularly — several states have changed theirs in the past three years. Figures here are for tax year 2026 and are worth re-checking before a move.

What to do next

Two numbers decide this and neither is the one in the headline: your county's actual property tax rate, and a real insurance quote on a real address.

• Retirement state tax calculator — what any state charges on your income, cited per state
• RMD calculator — the distribution you must take, which no state changes
• Home insurance premium estimator — the line this article says decides it
• The Relocation Tax Playbook — establishing domicile, and the states that contest it