Updated October 5, 2026. Quick answer: Yes, at a flat rate. Utah’s code, effective January 1, 2026, says “tax is imposed on the state taxable income of a resident” and sets the rate at 4.45%. The sections read name no exclusion for annuity payments; the only retirement relief printed is a $450 credit for people born on or before December 31, 1952.
State retirement-income forms, line by line: Utah retirement credit.
How Utah treats annuity income
| Item | What the documents say |
|---|---|
| Treatment | Taxed at the flat rate; a small credit for people born on or before December 31, 1952 |
| Rate | 4.45% of state taxable income, effective January 1, 2026 (Utah Code 59-10-104) |
| Credit | “each eligible claimant may claim a nonrefundable tax credit of $450” |
| Phase-down | Reduced by $.025 for each dollar of modified adjusted gross income above $25,000 (single), $32,000 (head of household or joint) or $16,000 (married filing separately) |
| Who is eligible | “who was born on or before December 31, 1952.” |
A $24,000 example
A stream of $24,000 in annuity payments is taxed, computed as $24,000 x 4.45% = $1,068 before credits.
A single filer born on or before December 31, 1952 with modified adjusted gross income under $25,000 could claim the full $450 credit against that tax.
What changes in 2026
The flat rate printed in the statute is effective January 1, 2026 (amended by Chapter 250, 2026 General Session); the code text read does not print the prior rate.
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 Utah taxes pensions, how Utah taxes retirement income, state tax on 401(k) and IRA withdrawals, how a surrendered annuity is taxed, and pension and annuity decisions.
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Answer againSources
- Utah Code 59-10-104: Tax basis, tax rate, exemption (Utah Legislature): https://le.utah.gov/xcode/Title59/Chapter10/C59-10-S104_2026050620260506.html
- Utah Code 59-10-1019: Nonrefundable retirement tax credit (Utah Legislature): https://le.utah.gov/xcode/Title59/Chapter10/C59-10-S1019_2022032320220323.html
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.