Does Hawaii tax pensions and retirement income?
Taxed, with a retirement exclusion
Partly. Hawaii does not tax qualifying distributions from employer-funded pension plans, including government and military pensions. Plans you fund yourself, such as IRAs and 401(k) contributions, are treated as your own investments and taxed.
In the state's own words
Copied word for word from the official document linked below each quote:
“Hawaii does not tax qualifying distributions from an employer-funded pension plan.”
“Retirement vehicles that you fund yourself, such as annuity plans and Individual Retirement Accounts (IRAs) that are not funded through a Simplified Employee Pension (SEP) plan, are considered to be your own investments.”
And Social Security?
No. Hawaii does not tax Social Security. The Hawaii Social Security page quotes the rule.
Federal tax still applies
Whatever Hawaii does, pensions, annuities and traditional IRA or 401(k) withdrawals are generally taxable on your federal return. See the federal tax brackets and, if you are 73 or older, the required minimum distribution calculator.
State rules change, and the details (age limits, income limits, which plans qualify) matter. Check with the Hawaii Department of Taxation before you file or move.
Other states in the same group
Check our work
The answer above comes from this document. Follow the link and compare.
- 2025 Form N-11 InstructionsHawaii Department of Taxation. Read on November 12, 2026.