Cost of Living? (Cleveland, Akron, Youngstown: sales, to rent, credit)

[kaydub]

We are contemplating a move to the Cleveland area (probably closer to Kent or Akron area) and I was wondering if a salary of $80,000 is considered good for that area. Here in Florida that would be good, but here there is no state income tax, and as you know in Ohio there are state and perhaps even local income taxes. What kind of "bite" will those taxes take out of that salary? Since that would be our main household income, I am a little concerned.

Unfortunately the online cost of living calculators do not take taxes into account, so they don't seem very helpful. They make Ohio look super cheap compared to here, but those taxes make me wonder...

Thanks!

[airics]

do you know what city you will be living in? property taxes and rita (regional income tax) will play a big role...

[JR_C]

Maybe you've seen this already:
Ohio Income Tax Rates - Ohio & other state tax rates information. OH tax calculator.

If your income range is between $40,001 and $80,000, your tax rate on every dollar of income earned is 5.201%.
If your income range is between $80,001 and $100,000, your tax rate on every dollar of income earned is 5.943%.

So, the most the state will take is $4800. (but talk to a tax professional at tax time, because if the $80k is the total you and your spouse's income, there is a difference if you file jointly or separately)

Youngstown has the highest local income tax in the state, and that's 2.75%. Akron has a 2.25% rate. That's another $1800.

So, the income tax you'll pay will be in the $6500-6800 range.

I think what you should be more concerned about are property tax rates, if you're not going to rent. They vary widely depending on the community.

$80k/year seems like plenty to me. I make about $30k/year, and live quite comfortably. But, I'm single, and own a home in Youngstown--where houses can be half the price of an equivalent place in Akron or Kent.

P.S.

"RITA" as airics mentioned above, is just the organization that local entities use to collect their income tax. It's not an additional tax.

[CortlandGirl79]

Cities like Akron, Youngstown and Cleveland have a wage tax if you live or work in the city limits. Most suburban areas do not have a wage tax. If you live in the suburbs in work in a city w/a wage tax, you still have to pay.

For example, i used to live in an area (Cortland) w/no wage tax, but worked in Warren, which has a wage tax. Because i worked there i had to pay it.

I think $80k is plenty to live on as long as you don't live beyond your means. If you have 3 cars, a boat and a $200k house it probably isn't enough. It all depends on your lifestyle.

Another thing i should mention as different school districts usually mean a big difference in taxes. Also, the best schools don't always have the highest taxes.

[kaimik]

Ditto what was said above about looking into property taxes if you are planning on buying. Property taxes here are about double where we came from! Overall, taxes here seem very high to us. We'd never heard of city or regional taxes before, and lived in a state without sales tax as well. Outside of taxes though, the cost of living here seems reasonable.

[airics]

my property taxes here are almost TRIPLE what they are on my home in Las Vegas... Home in vegas valued at more than double here...

[jlawrence01]

Originally Posted by kaydub

Unfortunately the online cost of living calculators do not take taxes into account, so they don't seem very helpful. They make Ohio look super cheap compared to here, but those taxes make me wonder...!

The local taxes can be very expensive. you may end up paying taxes in both the city you live in and the city you work in.

I won't say that the taxes ran me out of Ohio ... but it sure made the decision a lot easier.

[JR_C]

Originally Posted by jlawrence01

The local taxes can be very expensive. you may end up paying taxes in both the city you live in and the city you work in.

I won't say that the taxes ran me out of Ohio ... but it sure made the decision a lot easier.

Really? I thought that one only had to pay the higher tax rate. For example, if I lived in Youngstown, but worked in Akron, I would still have to pay the 2.75%. But Akron would get their 2.25%, and Youngstown would only get .5%.

I could certainly be wrong, though.

[jlawrence01]

Originally Posted by JR_C

Really? I thought that one only had to pay the higher tax rate. For example, if I lived in Youngstown, but worked in Akron, I would still have to pay the 2.75%. But Akron would get their 2.25%, and Youngstown would only get .5%.

I could certainly be wrong, though.

I am a CPA in Illinois (but was licensed in Ohio). I am not a tax expert. Most municipalities in Ohio have an LOCAL income tax. Some of the cities give you credit for what you pay the city that you work in; others do NOT.

CPAs in Ohio make a fortune because the state and local taxes are a royal PITA. In Ohio, high income earners often benefit from filing federal taxes as Married Filing Separate.

When I lived in Ohio, I did the prudent thing. I hired a CPA to do my taxes. (In fact, it was part of the benefits package I negotiated.) It was the smartest thing that I did. My wife worked as an contract employee and worked in as many as ten cities per year. It was not uncommon to file a federal return, a state return and as many as TEN local returns.

I moved out of Ohio in 2000. I understand that there are lower tax rates at this point so thing may be less difficult these days.

In Illinois, the state return takes ten minutes by hand. Income less expemptions less a couple of deductions and multiply by 3%. And there are NO local INCOME taxes. (And my property taxes are $25 less per year.)

I hope that helps.

My only advice is that you talk to coworkers and neighbors and get a good idea of what the tax ramification are of where you live.

[jmlicb]

You would live like a king in kent or Akron. Cleveland that would be around middle class