Just looked into whether Virginia taxes retirement income since I'm thinking about relocating there. Interesting thing - Social Security is completely off the hook, no state tax on it. But here's the catch: basically everything else gets taxed. Pensions, 401k withdrawals, IRA distributions - all hit with Virginia's income tax, which ranges from 2% to 5.75% depending on your bracket.

The one break you get is if you're 65+, there's a deduction up to $12,000 for pension income, which helps a bit. Roth IRAs are actually solid though - qualified withdrawals come out tax-free. What caught me off guard is that Virginia doesn't have estate or inheritance taxes, which is nice, but you still have to deal with property tax, sales tax (4.3% state plus local), and vehicle property taxes. So yeah, does Virginia tax retirement income overall? Depends what type, but most of it does get hit except Social Security.

Seems like a decent state if you're getting a decent Social Security check, but if you're relying on pensions or account withdrawals, you'll want to plan around those taxes. Anyone else here thinking about the Virginia move?