Georgia has a flat 4.99% income tax in 2026 — the target rate, reached ahead of schedule under HB 463. Social Security is fully exempt. Retirement income exclusions are very generous for residents over 62. Property tax averages 0.92%. No estate or inheritance tax.
At a glance
Key Facts
State Income Tax
Flat 4.99% (2026) — target rate reached ahead of schedule under HB 463
Retirement Income Exclusion
Age 65+: up to $65,000 per person exempt; Age 62–64: $35,000 exempt; Under 62: $5,000 pension exempt; Social Security exempt at all ages
Property Tax
Effective average ~0.92%; varies by county; Atlanta/Fulton County approximately 1.0%; Cobb County lower
Sales Tax
4% state rate; with county local option tax typically 7–8%; Atlanta 8.9% with MARTA and special purpose taxes
Estate and Inheritance Tax
None — Georgia has no state estate tax and no inheritance tax
Introduction
Georgia is in the middle of one of the most significant income tax transformations of any US state. After decades of a six-bracket graduated system topping at 6%, Georgia switched to a flat tax and has been cutting it aggressively: from 5.75% to 5.49% in 2024, down to 5.39% in 2025, and reached 4.99% in 2026 under HB 463 — ahead of the original 2029 target. This makes Georgia increasingly competitive with the Sun Belt’s lower-tax states and has contributed to Georgia’s remarkable population growth — the Atlanta, Savannah, and Augusta metros have all seen significant in-migration from the Northeast and Midwest.
For retirees, Georgia offers some of the most generous state-level retirement income exclusions in the Southeast: residents over 65 can exclude up to $65,000 of retirement income per person ($130,000 for a married couple), and Social Security is fully exempt at all ages. This guide covers the complete 2026 Georgia tax picture: income tax rates and planned cuts, the retirement income exclusion tiers, property taxes by county, sales tax, and how Georgia stacks up against Florida, Tennessee, and the Carolinas.
Section 01
Georgia’s Income Tax: HB 463 and the Rate History
Georgia’s income tax transformation is one of the most aggressive tax-cut stories in the US. Under HB 463 (signed 2026), Georgia accelerated its rate-cut schedule and reached 4.99% — the original long-term target — in the 2026 tax year, ahead of the original 2029 timeline:
Tax Year
Georgia Flat Income Tax Rate
2022 and prior
5.75% (top bracket of graduated system)
2024
5.49%
2025
5.39%
2026 (current)
4.99% — target reached under HB 463
2027 onward
4.99% (maintained)
The 4.99% rate places Georgia among the more competitive flat-tax states in the Southeast and marks the completion of the tax-cut trajectory that began with HB 1437 in 2022.
How Georgia Compares to Neighbors
State
Income Tax
Annual Tax on $150,000 (approx)
Florida
0% (no income tax)
$0
Tennessee
0% (no income tax)
$0
Georgia (2026)
4.99% flat
~$5,880
North Carolina
3.99% flat
~$5,985
South Carolina
5% flat
~$6,800
Alabama
2–5% progressive
~$6,750
Georgia’s 4.99% rate now undercuts South Carolina (5%) and is competitive with North Carolina (3.99%). The meaningful additional advantage lies in Georgia’s exceptional retirement income exclusions.
Section 02
Georgia Retirement Income Exclusions: Among the Best in the Southeast
The Age-Tiered Retirement Income Exclusion
Georgia’s retirement income exclusion is structured by age and is one of the most generous in any state that has an income tax. The exclusions apply per person (not per household for married couples — each spouse has their own exclusion):
Age
Maximum Retirement Income Exclusion Per Person
Under 62
$5,000 of pension/retirement income; $4,000 of other income
Age 62–64
$35,000 total retirement income per person
Age 65 and older
$65,000 total retirement income per person
Qualifying retirement income includes: pension income, IRA distributions, 401(k) distributions, annuity income, and similar retirement account distributions. Social Security benefits are exempt at all ages separately — they do not count against the retirement income exclusion limit.
Married Couple Retirement Example
Consider a married couple, both age 67, living in Georgia. Each spouse has $60,000 in IRA distributions and $20,000 in Social Security. Their Georgia income tax calculation:
Spouse 1: $60,000 IRA distribution – $65,000 exclusion = $0 taxable retirement income; $20,000 SS = fully exempt. Georgia taxable income: $0
Spouse 2: Same situation. Georgia taxable income: $0
Total Georgia income tax: $0 on $160,000 combined income
This is a compelling advantage. A couple with $160,000 in retirement income pays zero Georgia income tax. If they had $100,000 each in IRA distributions ($200,000 total), only $35,000 total (the excess above both exclusions) would be taxable at 4.99% — a bill of approximately $1,817. This makes Georgia genuinely competitive with Florida for retirement, when factoring in Georgia’s lower property taxes in many areas and lower cost of living in cities like Augusta, Macon, and even suburban Atlanta.
Section 03
Georgia Property Tax, Sales Tax, and Atlanta’s Tax Landscape
Property Tax Rates Across Georgia
Georgia’s effective property tax averages approximately 0.92% statewide, but varies significantly by county. Atlanta sits within Fulton County at approximately 1.0%, while surrounding suburbs — Cobb, Gwinnett, Cherokee, and Forsyth counties — often have lower rates and are among Georgia’s fastest-growing areas.
County
Approximate Effective Rate
Example: $400,000 Home Annual Tax
Fulton (Atlanta)
~1.03%
~$4,120
Cobb (Marietta)
~0.86%
~$3,440
Gwinnett
~1.01%
~$4,040
DeKalb
~1.15%
~$4,600
Cherokee
~0.74%
~$2,960
Forsyth
~0.71%
~$2,840
Georgia Homestead Exemption
Georgia offers a basic homestead exemption of $2,000 off the assessed value of your primary residence for state and county general taxes. Many counties offer additional local homestead exemptions on top of this. Senior homestead exemptions exist in many counties that can provide significant additional relief for residents 65 and over.
Sales Tax in Georgia
Georgia’s state sales tax is 4% — one of the lowest base rates in the country. However, counties add a Local Option Sales Tax (LOST) of 1% and may add other special purpose taxes, bringing the typical total to 7–8%. Atlanta is higher due to the MARTA (transit) tax and special purpose local option sales taxes, reaching 8.9% in some areas. Most groceries are exempt from the 4% state portion but may be subject to local taxes. Prescription drugs are exempt.
No Estate or Inheritance Tax
Georgia has no state estate tax and no inheritance tax. Only the federal estate tax applies to Georgia residents’ estates, with the $15M (2026, OBBBA) federal exemption covering virtually all Georgia estates. This, combined with the generous retirement income exclusions, makes Georgia an attractive state for both retirement and estate planning.
Need help maximizing Georgia’s retirement income exclusions, understanding the flat tax transition, or planning around Georgia’s property tax system? TaxHub connects you with licensed CPAs who know Georgia tax law.
⚠ Not for simple single-state returns. Free filing is fine for straightforward W-2 situations.
Georgia’s income tax rate in 2026 is a flat 4.99%, applied to all taxable income. Georgia switched from a graduated multi-bracket system to a flat tax and has been cutting the rate annually — 5.49% in 2024, 5.39% in 2025 — before HB 463 accelerated the schedule and landed at 4.99% in 2026, the original long-term target. There are no local income taxes in Georgia. The flat rate applies equally to wages, self-employment income, capital gains, and most other income.
Q
How much retirement income is tax-free in Georgia?
Georgia provides age-tiered retirement income exclusions: residents under 62 can exclude $5,000 of pension income; residents aged 62–64 can exclude $35,000 of retirement income per person; residents 65 and older can exclude $65,000 of retirement income per person. Social Security is fully exempt at all ages and does not count against these limits. For a married couple aged 65+, the combined exclusion is $130,000 of retirement income plus full Social Security exemption. This is one of the most generous state-level retirement tax treatments in the Southeast.
Q
Does Georgia tax Social Security income?
No — Georgia exempts Social Security benefits from state income tax at all income levels and all ages. This is a separate exemption from the retirement income exclusion for pensions and IRA distributions. Even high-income Georgia retirees pay zero Georgia income tax on their Social Security benefits. Federal taxation of Social Security still applies (up to 85% of benefits may be federally taxable depending on combined income), but Georgia adds nothing on top.
Q
Are property taxes high in Georgia?
Georgia’s effective property tax averages about 0.92% — below the national average of approximately 1.1%. For a $400,000 home in the Atlanta suburbs, expect to pay roughly $2,800–$4,600 per year depending on county. Outer suburban counties like Forsyth and Cherokee have notably lower rates than Fulton (Atlanta) or DeKalb. Georgia’s property taxes are considerably lower than northeastern states (New Jersey averages 2.23%; Illinois 2.05%) and moderately lower than the national average, though higher than Arizona (0.63%) or South Carolina.
Q
What is Georgia’s sales tax rate?
Georgia’s state sales tax is 4%, one of the lowest base rates in the US. Counties add Local Option Sales Tax (LOST) of typically 1%, bringing the base to 5% in most areas. Additional special purpose taxes can bring the total higher — Atlanta reaches 8.9% due to MARTA and other local taxes. Most groceries (unprepared food) are exempt from the state 4% portion but may be subject to county sales taxes. Prescription drugs are fully exempt. Compare to Arizona (5.6% + local) and North Carolina (4.75% + local).
Q
Is Georgia a good state for retirees from a tax perspective?
Yes — Georgia is one of the more tax-friendly states for retirees, particularly for those over 65. The combination of: full Social Security exemption, $65,000 per-person retirement income exclusion, no estate or inheritance tax, moderate property taxes, and the declining flat income tax rate makes Georgia competitive with Florida (no income tax but higher property taxes in many areas and no retirement-specific exemptions needed). For a retired couple with $150,000–$200,000 in combined income, Georgia’s effective state income tax can be near zero. Georgia also has lower housing costs than Florida’s coastal markets, which is a growing consideration for budget-conscious retirees.
Q
Does Georgia have an estate tax or inheritance tax?
No — Georgia has no state estate tax and no inheritance tax. Georgia eliminated its state estate tax in 2014. All estates of Georgia residents are subject only to the federal estate tax, which has a $15M per-person exemption (2026, OBBBA — raised from $13.61M and made permanent). With proper planning (portability between spouses), a married couple can pass $30M to heirs with no estate tax at any level. Georgia is therefore an excellent state for estate planning compared to states like Oregon, Massachusetts, or Washington that impose state estate taxes starting at $1–2M.
Disclaimer:This guide provides general tax information for educational purposes only. Georgia’s income tax rate reductions are subject to annual revenue triggers and legislative action. Retirement income exclusion amounts, property tax rates, and sales tax rates can change. Always consult a qualified Georgia CPA or tax professional before making significant financial, relocation, or retirement planning decisions.