Does Missouri Tax 401(k) Distributions for Retirees?

Yes, Missouri does tax 401(k) distributions. Traditional 401(k) withdrawals count as ordinary income on your Missouri return and are taxed at graduated rates topping out at 4.7%. The state offers a private pension deduction of up to $6,000 per taxpayer, but only if your Missouri adjusted gross income is below $25,000 (single) or $32,000 (married filing jointly), so many retirees end up paying tax on the full amount they withdraw.¹ Roth 401(k) distributions are a different story and generally escape Missouri tax entirely.

Missouri starts with your federal adjusted gross income when it calculates state tax.² Whatever the IRS treats as taxable from your 401(k) flows straight onto your Missouri return. A $40,000 traditional 401(k) withdrawal lands in your Missouri income at $40,000. From there, the only real question is whether you qualify to knock some of it back out with the state’s pension deduction.

The $6,000 Private Pension Deduction

Missouri law treats 401(k) plans as a qualifying “annuity, pension, or retirement allowance” for its private pension deduction.³ Traditional IRAs, Keogh plans, deferred compensation, and defined benefit annuities qualify as well. Roth IRAs are explicitly excluded.

The maximum deduction is $6,000 per taxpayer per year. On a joint return where both spouses have qualifying retirement income, each spouse can claim up to $6,000 individually.¹

Who Actually Qualifies

To claim the full $6,000, your Missouri adjusted gross income has to fall at or below these limits:¹

Single, head of household, or qualifying widow(er): $25,000
Married filing jointly: $32,000
Married filing separately: $16,000

Go over the limit and the deduction drops dollar for dollar. A single filer with $28,000 in Missouri AGI is $3,000 above the threshold, so the deduction shrinks from $6,000 to $3,000. Once you exceed the limit by $6,000 or more, the deduction is gone. For a single filer, that cutoff is $31,000.

The threshold looks at all your Missouri AGI, not just the 401(k) piece. Part-time wages, investment income, and other retirement distributions all count toward it. Realistically, a retiree drawing meaningful income from a 401(k) will exceed these numbers, which is why the deduction sounds more useful than it usually is.

If You Also Have a Government Pension

Missouri offers a separate, much more generous deduction for public pensions from federal, state, or local employment. Starting with the 2024 tax year, that deduction has no income limits and can shelter up to 100% of your public retirement benefits, capped at the maximum Social Security benefit for the year.¹

The tradeoff: your private pension deduction is reduced by the amount of your public pension deduction. If your public pension deduction already matches or exceeds $6,000 per spouse, your 401(k) deduction drops to zero.⁴ This mostly hits retired government workers who also built up a 401(k) in the private sector.

Missouri’s Tax Rates on What’s Left

For the 2026 tax year, Missouri’s individual income tax tops out at 4.7% on taxable income above $9,191, with graduated rates starting at 2.0% just above the roughly $1,313 zero bracket.⁵ Because the top bracket kicks in so low, most 401(k) money gets taxed at the full 4.7% rate. The graduated structure provides only modest relief on the first few thousand dollars.

Roth 401(k) Distributions Are Not Taxed

Qualified Roth 401(k) distributions aren’t included in your federal AGI, and since Missouri builds its income calculation on federal AGI, they don’t show up in your Missouri taxable income either.² A qualified distribution generally means you’re at least 59½ and the Roth account has been open five years or more.

You won’t find Roth accounts on the private pension deduction list, but that doesn’t cost you anything. There’s nothing to deduct when the income was never taxable to begin with.³ If you have the option to contribute to a Roth 401(k) during your working years, it’s one of the cleanest ways to avoid Missouri tax on retirement withdrawals altogether.

Social Security Is Separately Exempt

Since the 2024 tax year, Missouri does not tax Social Security retirement benefits for anyone age 62 or older, or Social Security disability benefits at any age, as long as those benefits appear in your federal AGI.¹ This exemption is completely separate from the pension deductions and doesn’t eat into your $6,000 private pension deduction.

The practical result: if you’re drawing both Social Security and 401(k) money, the Social Security piece is fully shielded from Missouri tax while the 401(k) piece is fully taxable with only the limited deduction available. That distinction matters when you’re deciding which account to tap first.

Early Withdrawals Before Age 59½

Missouri does not impose its own penalty on early 401(k) withdrawals. The 10% federal penalty still applies, and it isn’t deductible on your Missouri return. The full withdrawal also counts as taxable income on your Missouri return.

Most people taking early distributions are still working, which means their wages typically push Missouri AGI well past the $25,000 or $32,000 threshold. In that case, the private pension deduction is gone and the whole distribution is taxed. Between the federal penalty, federal income tax, and Missouri income tax, an early withdrawal can easily cost 30% or more of the amount you pull out.

Required Minimum Distributions

Once you hit RMD age, federal law forces money out of a traditional 401(k), and every dollar of that RMD lands in your Missouri AGI.¹ Under the SECURE 2.0 Act, RMDs begin at age 73 for people born between 1951 and 1959, and at age 75 for those born in 1960 or later. Your first RMD must be taken by April 1 of the year after you reach the applicable age; every RMD after that is due December 31.

Watch the first-year timing. If you push your first RMD to the April 1 deadline, you’ll take two RMDs in that same calendar year, which can blow past the private pension deduction thresholds and wipe out the deduction entirely. Taking the first RMD in the year you turn 73 or 75 (rather than delaying) keeps the income spread out.

Withholding or Estimated Payments

Missouri does not require state withholding from pension or 401(k) payments. You can voluntarily elect it using Form MO W-4P, with a minimum of $10 per month if you do.⁶

Skip withholding and you’ll likely need quarterly estimated payments. Missouri requires them when your expected state tax liability is $100 or more for the year, with due dates of April 15, June 15, September 15, and January 15.⁷ To avoid an underpayment penalty, your total payments have to hit either 100% of last year’s liability or 90% of this year’s, whichever is less. For most retirees taking regular distributions, arranging withholding through the plan administrator is simpler than tracking quarterly deadlines.

Claiming the Deduction on Your Return

You file Form MO-1040 and attach Form MO-A to claim the private pension deduction.⁸ The calculation lives in Part 3, Section B of MO-A, where you enter the taxable pension amount from your federal return and the form applies the $6,000 cap and income phase-out. The result flows over to reduce your Missouri taxable income.⁴ Keep your 1099-R forms from the plan administrator in case the Department of Revenue asks.

What Happens If You Move Out of Missouri

Federal law bars any state from taxing retirement income paid to a non-resident.⁹ 401(k) distributions, IRA withdrawals, government pensions, and most other qualified retirement payments are all covered. If you retire from a Missouri employer and move to Florida or Texas, Missouri can’t tax the 401(k) money you built up while you lived there.

The protection depends on you actually not being a Missouri resident or domiciliary under state law. A vacation home or a Missouri bank account alone doesn’t make you a resident, but splitting time between states can complicate the facts-and-circumstances test for domicile. Establishing clear residency in your new state before taking large distributions is the safer path.

1
Missouri Department of Revenue. Pension FAQs
2
Missouri Revisor of Statutes. Missouri Code 143.121 – Missouri Adjusted Gross Income
3
Missouri Revisor of Statutes. Missouri Code 143.124 – Annuities, Pensions, Retirement Benefits, or Retirement Allowances
4
Missouri Department of Revenue. Form MO-A – Individual Income Tax Adjustments
5
Missouri Department of Revenue. 2025 Individual Income Tax Year Changes
6
Missouri Department of Revenue. Form MO W-4P – Withholding Certificate for Pension or Annuity
7
Missouri Department of Revenue. MO-1040ES – Declaration of Estimated Tax for Individuals
8
Missouri Department of Revenue. Missouri Department of Revenue Individual Income Tax Long Form MO-1040 Instructions
9
Office of the Law Revision Counsel. 4 U.S. Code 114 – Limitation on State Income Taxation of Certain Pension Income