Updated October 4, 2026. Quick answer: Yes, but a retiree aged 65 or older can exclude a lot. Georgia taxes IRA and pension distributions, and its booklet says “The maximum retirement income exclusion is $65,000” per person at 65 or older, with up to $5,000 of it earned income.
State retirement-income forms, line by line: Georgia retirement income exclusion.
Inherited an IRA? What the state’s own documents say about taxing those withdrawals: Georgia tax on inherited IRA withdrawals.
Hold a 403(b) or 457(b)? What the state’s own documents say about taxing those withdrawals: does Georgia tax 403(b) and 457(b) withdrawals.
Withdrawing from an IRA or 401(k)? Whether the state withholds tax from it, from its own documents: Georgia tax withholding on IRA and 401(k) withdrawals.
Inheriting from, or planning for, someone in this state? Whether the state has an inheritance tax, from its own tax documents: Does Georgia have an inheritance tax?.
What Georgia does with 401(k) and IRA withdrawals
The booklet says “the income tax rate is 5.19%” on the 2025 return.
| Item | What the documents say |
|---|---|
| Treatment | Taxable, with a retirement income exclusion |
| Exclusion | $65,000 per person at 65 or older ($35,000 at 62 to 64); up to $5,000 of it may be earned income |
| State rate | 5.19% for 2025, 4.99% for 2026 |
| Source | Georgia Department of Revenue, 2025 IT-511 booklet and Important Tax Updates page |
A $40,000 withdrawal
A $40,000 withdrawal is all retirement income and below the $65,000 limit, so a single filer aged 65 or older excludes all of it and owes $0 of Georgia tax on it. Anything else you earn or receive counts against the same limit.
Conditions that decide the answer
- Each spouse must qualify separately and each may claim the $65,000 amount.
- At 62 to 64 the amount is $35,000; up to $5,000 of any exclusion may be earned income.
- The booklet’s Schedule 1 lists taxable IRA distributions and taxable pensions as separate lines.
What changes in 2026
The Department’s updates page says the rate was reduced to a flat rate of 4.99% for 2026.
Federal rules
The state’s treatment sits on top of the federal one. The IRS explains the federal tax on these withdrawals in Publication 590-B, Distributions from Individual Retirement Arrangements and Publication 575, Pension and Annuity Income.
Related: whether Georgia taxes pensions, how Georgia taxes retirement income, whether Georgia taxes Roth conversions, and the state-by-state table of 401(k) and IRA withdrawal tax.
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Answer againSources
- 2025 IT-511 Georgia Individual Income Tax Forms and Instructions Booklet: https://dor.georgia.gov/document/document/2025-it-511-individual-income-tax-booklet/download
- Important Tax Updates (2026 Income Tax Changes): https://dor.georgia.gov/taxes/important-tax-updates
Sources: the primary documents linked above, read on October 4, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.