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As of November 2012, there were seven states that did not charge any type of state income tax, including taxes on Social Security benefits. These states include Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Two more states, Tennessee and New Hampshire, do not tax income or Social Security benefits, but do tax interest and dividends.
Half of your benefits may be taxable when your combined income falls between $25,000 and $34,000. 85 percent of your benefits may be taxable when your combined income exceeds $34,000. If you file as single, none of your Social Security benefits are taxable if your combined income falls below $25,000. Half of your benefits may be taxable when your combined income falls between $25,000 and $34,000. 85 percent of your benefits may be taxable when your combined income exceeds $34,000.