Why do I not have to pay tax on my pension?

It depends.

What type of pension are you referring to? With respect to Federal taxes, generally, Social Security Benefits are not taxable as well as many military type pensions.

With respect to states, many states exempt pension income of different types or amounts, even if taxed federally. Each state is different and unique but many states have some provision to help retirees with pension or other retirement income.

If you tell us more about your pension and whether you are referring to federal tax or state tax and we will be happy to provide more insight.

pensions are taxable, however, if your TOTAL income is low enough there is no tax to pay.