Social Security Move Sparks Praise From Seniors

Lawmakers in West Virginia have passed a bill that will end taxes on Social Security benefits, winning the praise of interest groups and campaigners within the state.

The budget for fiscal year 2025 passed the Senate on Saturday and was approved 88-11 with one member absent. It includes an incremental cut down to state taxes levied on Social Security benefits, building on legislation enacted in 2019 that started the gradual elimination of income tax for Social Security recipients with incomes below $50,000, if a single filer, and $100,000, for joint filers.

This was initiated with a 35 percent reduction in benefits for eligible taxpayers starting in 2020, rising to 65 percent in 2021 before reaching 100 percent in 2022. Now, Senate Bill 458, formerly House Bill 4880, would extend the tax reduction to all Social Security recipients regardless of their annual earnings.

This, like the 2019 law, will be gradually introduced over three years, with state income tax being cut by 35 percent this year, retroactive to January 1, 65 percent in 2025, and completely wiped out in 2026. The tax cut would cost around $37 million in both 2025 and 2026 and would impact more than 50,000 households, according to a report by The Associated Press.

It means that in 2026, West Virginia will become one of the majority of U.S. states that do not levy state-level taxes on income from Social Security benefits. Currently, only 11 states still enact taxes on Social Security benefits. These are: Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah and Vermont, according to Bankrate.

“We are tickled and delighted that the House and the Senate both agreed to eliminate in a prudent way, over a three-year period, the tax on Social Security income,” said Gaylene Miller, state director of AARP West Virginia, an interest group that works on issues affecting those aged 50 and over.

“Any increase in their income or any tax break for them is very much needed, and this 35 percent reduction in Social Security taxes the first year, 65 percent the second year and completely gone the third year is something we’ve been pushing for our retirees, and it is a good measure for them,” said Dale Lee, president of the West Virginia Education Association.

The bill will now head to the desk of state governor Jim Justice, a Republican, who has supported the bill throughout its journey through the legislative process. Newsweek has contacted Justice via email for comment outside of normal working hours.

While Justice has not yet commented publicly on the passage of the bill, he wrote on X, formerly Twitter, that cutting taxes in West Virginia is one of his top priorities.

He wrote: “We’ve cut taxes 23 times since I took office in 2017, and this year I proposed three additional tax cuts in my budget: eliminating the tax on social security, a childcare tax credit, and an expansion to the Homestead exemption.”