Just compiled a pretty useful guide on tax breaks for retirees across the Midwest — turns out there's way more opportunity to keep more money than most people realize.

Starting with the heavy hitters: Illinois basically doesn't tax retirement income at all. No taxes on 401(k) withdrawals, pensions, or Social Security benefits. That's huge. But here's the catch — property taxes there are brutal, so you'll want to offset that advantage by looking into Roth conversions and timing your Social Security claims strategically.

Iowa's another solid option. Social Security is completely exempt, and if you're over 55, your retirement income sources like 401(k)s, IRAs, and pensions don't get taxed either. Roth conversions can also unlock additional exemptions.

Now, Indiana has a different approach with specific credits — there's the Over 65 Circuit Breaker Credit that caps how much your taxes spike year to year, plus the Unified Tax Credit for the Elderly offering $1,000 exemptions for those over 65.

Kansas gives you a mixed bag. Social Security and public pensions are tax-free, but IRAs and 401(k)s are fully taxable. Fair warning though — they treat capital gains as regular income, which catches a lot of people off guard.

Michigan introduced the 2023 Lowering MI Costs Plan, letting retirees choose how they deduct taxable retirement income. You can pick tiered subtraction systems or phase-in options that increase deductions annually.

Minnesota recently added a means-tested deduction for Social Security — if you're single making under $82,190 or married filing jointly under $105,380, you're not paying state income tax on those benefits.

Missouri focuses on property tax relief. If you're 65 or disabled, you can deduct $1,100 from property taxes if you own, or $750 if you rent.

Nebraska has the homestead exemption for those over 65 with income below $51,301 (individual) or $60,901 (married). That can reduce your property taxes by 10% to 100% depending on your situation.

North Dakota's homestead credit is similar — retirees over 65 with income under $70,000 can get 50-100% credit on property taxes.

Ohio offers a homestead exemption for retirees over 65 with adjusted gross income under $38,600, protecting up to $26,200 of your home's value from taxation.

South Dakota has an interesting one: if you're making less than $15,218 (single) or $20,110 (household), you can reduce municipal taxes by 25-100%.

And here's what caught my attention — Wisconsin state income tax rate considerations for retirees. If you're over 65 in Wisconsin and making less than $15,000 individually or $30,000 filing jointly, you can deduct $5,000 of retirement income from IRAs or qualified retirement plans. The wisconsin state income tax rate structure actually makes this particularly valuable for those borderline cases.

The takeaway? Each state has different priorities. Some go hard on income tax exemptions, others focus on property tax relief. The key is knowing which state's strategy aligns with your specific retirement income sources. Worth running the numbers if you're flexible on location.