Moving to Florida From New Jersey: Is Your Annuity Taxed?
Florida has no personal income tax, and New Jersey generally does not tax annuity income paid to a nonresident. Once Florida is your legal home, the New Jersey tax on that income generally stops. Federal tax stays the same. The contract stays in force. What decides the outcome is whether New Jersey agrees you actually left.
That last sentence is where the money is won or lost. Buying the condo in Naples is the easy part. Showing Trenton that your life moved with the furniture takes planning. Here is how it works, with each state's own rules linked.
Does Florida tax annuity income?
No. Florida does not have a personal income tax, so a Florida resident owes no state income tax on annuity payments, pension checks, IRA withdrawals, or Social Security.
The Florida Department of Revenue puts it in one line: the state "does not have a personal income tax." The Tax Foundation's Florida profile also shows no estate or inheritance tax.
Federal tax follows you to every state. The taxable part of each payment still goes on your federal return, as the IRS explains in Topic 410, Pensions and Annuities. Florida simply adds no second layer.
Does New Jersey still tax your annuity after you move?
Generally not, once you are a nonresident. The New Jersey Division of Taxation states that a nonresident's pension, annuity, and IRA income is not subject to New Jersey Income Tax.
The tax year you move is split in two. New Jersey treats you as a part-year resident. You file the regular resident return, Form NJ-1040, show the dates you lived there, and report only the income you received in that window.
Two details from the state's bulletin on part-year residents (GIT-6) matter that year. A month counts as a New Jersey month if you were a resident for 15 days or more of it. And your exemptions, along with any retirement income exclusion, are generally prorated to match your months of residence.
This is general education and is not tax or legal advice.
What makes you a Florida resident in New Jersey's eyes?
Your domicile does. Domicile is the legal word for your one permanent home, the place you intend to return to after any time away. You can own several houses. You get only one domicile.
For New Jersey income tax purposes, your domicile continues until you establish a new permanent home somewhere else. The Division of Taxation lists what it weighs:
Your intent
Where you register to vote
Your driver's license and vehicle registration
Where you have family ties
Whether your federal tax return lists New Jersey as your home address
Where your bank accounts are
Whether you took part in a New Jersey property tax relief program
Then come the day counts.
If New Jersey is still your domicile, you are a resident unless you keep no permanent home in New Jersey, keep a permanent home elsewhere, and spend no more than 30 days in the state.
If New Jersey is no longer your domicile, you are still treated as a resident if you maintain a permanent home there and spend more than 183 days in the state. Tax professionals call this statutory residency.
The second rule matters to anyone keeping the house in Bergen County. A Florida driver's license may not be enough if the number of days in New Jersey tells a different story. Keep a calendar.
On the Florida side, the homestead exemption is granted on property you make your permanent residence, and it can lower the home's taxable value by as much as $50,000. Claiming it while still taking New Jersey property tax relief on the old primary residence tells two stories at once.
What happens to the annuity contract when you move?
The contract itself generally does not change. Your rate, your term, your income rider, and your surrender schedule (the declining charge for taking money out early) are set by the contract, and a new address does not rewrite them.
What needs updating is the paperwork around it:
Your address on file with the insurance company
Your state tax withholding election, so New Jersey tax is not withheld from payments made to a Florida resident
Your beneficiary designations
At Lehman Brothers I led the fixed income and foreign exchange strategy team, and the question behind that work was whether an institution could keep its promise. A move is a good moment to ask it again. Annuity guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company.
If you are buying around the move, product features and availability vary by state. Start with how a fixed index annuity works.
Should you start annuity income before or after the move?
If you have the choice, timing deserves a conversation before anything is switched on. Income received as a Florida resident is generally outside New Jersey's reach. Income received as a New Jersey resident is not.
Here is a hypothetical. A married couple, both 66, file jointly. Their other income places them in New Jersey's 6.37% bracket, which covers taxable income from $150,000 to $500,000 on a joint return under the state's tax rate schedules. They take $30,000 of taxable annuity income, all of it inside that bracket.
Here is the tax on that $30,000, before and after the move:
Federal income tax: owed either way, and the same amount.
New Jersey income tax: about $1,911 while a New Jersey resident (6.37% of $30,000), and $0 after Florida is the legal home.
Florida income tax: $0. Florida has none.
Hypothetical illustration only, not a projection. New Jersey rate from the tax rate schedules for tax years 2020 and after, as published in October 2026. Your numbers will differ.
Two limits on that example. First, New Jersey residents who are 62 or older with total income of $150,000 or less can exclude part or all of their pension and annuity income, up to $100,000 on a joint return when total income is $100,000 or less (tax year 2025 figures). For that household, the move saves less on this line.
Second, tax should never be the only reason to delay income you need. If the annuity's job is to cover essential bills, the right start date is the day the bills start. That is the core of retirement income planning, and it is why I look at sequence of returns risk before anyone picks a date.
What else changes besides income tax?
Two things travel with the same move.
The home sale. What people call the New Jersey exit tax is an estimated income tax payment on real estate, not a toll for leaving. Nonresident sellers generally pay 2% of the sale price at or before closing, and the state allows certain exemptions and waivers.
Inheritance tax. New Jersey imposes an inheritance tax that depends on who the beneficiaries are and whether the person who died was a legal resident. Florida has none. An estate attorney should review your documents after the move.
Want your annuity reviewed before the move?
Thirty minutes, your numbers, and a clear look at how a change of address changes the picture. I am licensed in New Jersey and Florida. Book an Annuity Review.
Frequently asked questions
Does New Jersey tax my annuity income after I move to Florida?
Generally no. Once you are a nonresident, New Jersey does not subject pension, annuity, or IRA income to its income tax. In the year you move, New Jersey taxes only the income you received while you were still a resident.
Does Florida tax annuity income?
No. Florida does not have a personal income tax, so residents owe no state income tax on annuity payments, pensions, IRA withdrawals, or Social Security. Federal income tax still applies to the taxable part of each payment, exactly as it would in any other state.
Do I need a new annuity contract when I move to Florida?
Generally no. Your existing contract moves with you, and its rate, term, and income provisions are set by the contract itself. Update your address, your state tax withholding election, and your beneficiaries with the insurance company. Guarantees remain backed by the claims-paying ability of the issuing insurer.
How does New Jersey decide whether I am still a resident?
New Jersey looks at your domicile, meaning your one permanent home. It weighs your intent, voter registration, driver's license, family ties, bank accounts, and the address on your federal return. Separately, keeping a permanent home in New Jersey and spending more than 183 days there can make you a resident even after your domicile changes.
Do I file a New Jersey tax return the year I move?
Usually yes. New Jersey has no separate part-year form, so you file the regular resident return, Form NJ-1040, and show the dates you lived there. You report only the income received during that period, and exemptions are prorated by months of residence.
What is the New Jersey exit tax?
It is an estimated income tax payment, collected when a nonresident sells New Jersey real estate. The seller generally pays 2% of the sale price at or before closing, and the state allows certain exemptions and waivers. It applies to the home sale, not your annuity.
Does moving to Florida change the federal tax on my annuity?
No. Federal rules are the same in every state. The taxable part of each payment is generally taxed as ordinary income, any after-tax money you put in comes back without tax, and withdrawals before age 59½ may owe an additional 10% federal tax.
Michael Trefel is a licensed insurance producer in New Jersey, Colorado, Florida, and Texas. Annuities are insurance products. They are not bank deposits and are not FDIC insured. Guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company. Withdrawals may be subject to surrender charges, ordinary income tax, and, before age 59½, a 10% federal tax penalty. This article is general education and is not tax, legal, or investment advice.
