Updated October 5, 2026. Quick answer: Yes, with a break. Georgia’s Department of Revenue lists “Income from pensions and annuities” as retirement income that residents 62 or older, or “permanently and totally disabled regardless of age”, can exclude, up to $35,000 at ages 62 to 64 (or under 62 and permanently disabled) and up to $65,000 at 65 or older for 2025. Anything above the cap is taxed at the flat rate, 5.19% for 2025.
State retirement-income forms, line by line: Georgia retirement income exclusion.
How Georgia treats annuity income
| Item | What the documents say |
|---|---|
| Treatment | Taxed at the flat rate, with a retirement income exclusion for age 62 or older, or for permanent and total disability at any age |
| 2025 rate | 5.19% |
| 2026 rate | 4.99% |
| Exclusion, ages 62 to 64, or under 62 and permanently disabled | Up to $35,000 per taxpayer |
| Exclusion, age 65 or older | Up to $65,000 per taxpayer |
| Above the cap | “exceeding the maximum adjustable amount will be taxed at the normal rate.” |
A $24,000 example
A taxpayer 65 or older with $24,000 of annuity payments and no other retirement income is below the $65,000 cap, so the exclusion covers all of it and it adds $0 of Georgia tax.
A taxpayer under 62 who is not permanently and totally disabled gets no exclusion: $24,000 x 5.19% = $1,245.60 for 2025, and $24,000 x 4.99% = $1,197.60 for 2026, before any other income or deduction.
What changes in 2026
The Department’s Important Tax Updates page says the Georgia income tax rate has been “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 side in Topic no. 410, Pensions and Annuities and Publication 575, Pension and Annuity Income.
Related: whether Georgia taxes pensions, how Georgia taxes retirement income, annuity income tax by state, how a surrendered annuity is taxed, and pension and annuity decisions.
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Answer againSources
- Retirement Income Exclusion (Georgia Department of Revenue): https://dor.georgia.gov/retirement-income-exclusion
- 2025 IT-511 Individual Income Tax Booklet (Georgia Department of Revenue): https://dor.georgia.gov/document/document/2025-it-511-individual-income-tax-booklet/download
- Important Tax Updates (Georgia Department of Revenue): https://dor.georgia.gov/taxes/important-tax-updates
Sources: the primary documents linked above, read on October 5, 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.