New Hampshire will provide substantial tax relief to seniors beginning in 2026, as a federal bill exempts most Social Security benefits from federal taxes. The legislation raises the percentage of retirees exempt from income tax on Social Security from 64% to 88%, potentially impacting 14.2 million individuals nationwide. New Hampshire has a high senior population, with around 300,000 retirees, nearly all of whom are expected to benefit from this deduction. Additionally, wage increases for working seniors in the state are projected to be significant, adding to their financial relief.
According to the White House, the bill passed raises the share of retirees who won't pay federal income tax on their Social Security from 64% to 88%-an increase of 14.2 million people across the U.S.
The so-called senior deduction sits on top of existing exemptions and the standard deduction, ensuring most recipients no longer owe taxes on Social Security income.
New Hampshire is home to approximately 300,000 retirees, based on 2023 Census estimates. The state's 65+ population represents about 21.8% of the total.
Projected real wage increases range from $4,500 to $8,100, with real take-home pay improvements of $8,100 to $11,900-among the top 10 states nationally.
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