What's your biggest worry regarding retirement? For most people, it's simply outliving their money. That's why so many of us are working so hard to save as much as we possibly can right now.

The good news is, your retirement income might actually go a little bit further than you expect. Although Social Security was never intended to be an individual's sole source of retirement funding, at least this part of your future cash flow isn't taxed in most states.

Still, there are a few things you'll need to know about that taxation of your retirement benefits.

State taxation of Social Security retirement benefits

As of the latest look, 41 states don't tax Social Security retirement benefits. In alphabetical order, these states are:

1. Alabama

2. Alaska

3. Arizona

4. Arkansas

5. California

6. Delaware

7. Florida

8. Georgia

9. Hawaii

10. Idaho

11. Illinois

12. Indiana

13. Iowa

14. Kansas*

15. Kentucky

16. Louisiana

17. Maine

18. Maryland

19. Massachusetts

20. Michigan

21. Mississippi

22. Missouri

23. Nebraska

24. Nevada

25. New Hampshire

26. New Jersey

27. New York

28. North Carolina

29. North Dakota

30. Ohio

31. Oklahoma

32. Oregon

33. Pennsylvania

34. South Carolina

35. South Dakota

36. Tennessee

37. Texas

38. Virginia

39. Washington

40. Wisconsin

41. Wyoming

* Kansas altered its tax laws just last month to make Social Security benefits tax-free beginning this tax year.

But what if you live (or plan on living) in one of the other nine states? Don't sweat it. Most of them are still relatively gentle when it comes to taxing these benefits.

Take Colorado as an example. Its residents between the ages of 55 and 64 aren't taxed on their first $20,000 worth of yearly Social Security income, while anyone over the age of 65 living in the Centennial State doesn't owe any income tax on their Social Security benefits. This means a huge swatch of older Coloradans are actually side-stepping the state's 4.4% flat income tax on at least a portion of their retirement income.

Meanwhile, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah, and Vermont each offer some degree of income-based tax breaks on Social Security income. That is to say, in several of these seven locales, only the highest of retirement earners will owe state taxes on any such benefits. In other states a decent-sized chunk of Social Security income is deductible from the federally reported taxable income generally used to determine state-based tax liabilities.

Last year was also the final year West Virginians' Social Security income will be fully taxed by the state. Earlier this year the state's legislature passed measures that will gradually phase out the taxability of these benefits. Only 65% of this income will taxable this year, and only 35% next year. Come 2026, the state won't be taxing any portion of anyone's Social Security income.

And the District of Columbia? Social Security retirement income is tax-exempt there as well.

By the way: Feeling compelled/pressured to join the crowd, many of the few states that do still tax even a portion of Social Security retirement income are now regularly considering a repeal of these tax laws.

That said, regardless of which state you live in, your Social Security benefits are at least still subject to federal income taxation. Not all of it, though.

Individuals with adjusted gross annual income between $25,000 and $34,000 will potentially owe income tax on up to half of their benefits. For anyone with retirement earnings in excess of $34,000, up to 85% of their Social Security benefits are considered taxable income. And for joint filers, these thresholds are raised to $32,000 and $44,000.

Still, even if you can save just a few thousand bucks in taxes every year just by living in a different state, it may well be worth the move.

A big enough benefit to consider when making plans

Of course, there's more to life than minimizing your annual tax bill. Maybe you've got close family in a state that still taxes Social Security benefits. Perhaps the cost of living is low even in a state that still taxes a sizable portion of your retirement income. There's always more to the story.

For many current and soon-to-be retirees, however, saving just a few thousand bucks per year could make a major difference with their budgets -- particularly for relatively high-earning retirees with income subject to state-level taxation. At the very least, it's something worth considering. That's especially true if you can sell your current home at an attractive price and/or find a new one at a price you also like.

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41 States That Don't Tax Social Security Benefits was originally published by The Motley Fool