Mexico is the number-one destination for American retirees: close to the US, warm climate, low costs and quality healthcare. Here are the key questions for a US retiree — taxes, Social Security and residency in 2026.
Is Social Security taxed in Mexico
Under the US-Mexico double-taxation treaty, Social Security payments are taxed only in the US, even if you become a Mexican tax resident. This protects retirees from double taxation.
Taxes overall
- The US taxes citizens on worldwide income regardless of where they live — you must still file with the IRS.
- The US-Mexico treaty and tax credits prevent double taxation for most retirees.
- If you become a Mexican tax resident (183+ days), confirm your status with a specialist.
Residency for retirees
There is no special retirement visa; you get residency by income. A pension (including Social Security) counts as income. 2026 requirements: temporary from ~$4,400/mo, permanent from ~$7,300/mo. Many US retirees qualify for permanent status directly. More in our retire in Mexico article.
Cost of living and healthcare
A retired couple lives comfortably on $1,800–$3,000/month. Private healthcare costs 50–70% less than the US. Residents can join the public IMSS system. More in healthcare for expats.
Best cities
Popular choices are Lake Chapala, San Miguel de Allende, Merida and Playa del Carmen — with large American communities.
Planning retirement in Mexico? We arrange residency turnkey. Message us.