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Old 12-17-2006, 08:47 AM
 
Location: SE Florida
135 posts, read 437,776 times
Reputation: 54

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Is there a 'pension tax' in Colorado? My husband is retiring from our local police dept in Jan, 2011 and we want to relocate out west. There are under 15 states with NO pension taxes.

Colorado, from what we can tell, does have some type of pension tax. Although, we can't seem to locate a website that gives specifics/%'s on this.

Does anyone have any knowledge of Colorado's pension taxes?

Thanks.
mes3fils
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Old 12-17-2006, 09:54 AM
 
17,373 posts, read 24,625,888 times
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Default There is a sort of exemption....on GOVERNMENT pensions

...I say "sort of" because you must be 55 years of age and because there are limits to how much is exempt. Oddly enough, I found it on a state of Massachusetts site....http://www.dor.state.ma.us/help/guid...s/fed_annu.htm

The table summarizes the "out of state" exemptions for government pensions, if any, for all the states. Pretty cool info. This link is going into my favorites list.

Found it by googling [ Colorado +pension +exemption ]. I LOVE google, wish I'd bought stock in it long ago.....

In the case of Colorado, the site says: "All out-of-state government pensions qualify for the pension exemption: age 55 to 64 qualify for a $20,000 exemption; age 65 or older qualify for a $24,000 exemption." That's just one more of the reasons why we decided to retire here.

No personal income tax at all: NV, SD, TX, WA and WY.
Partial exemptions on government pensions: CO, OK, MT and UT.
Fully taxed: AZ, CA, ID, KS, NE, NM and ND.

s/Mike
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Old 12-17-2006, 10:04 AM
 
Location: SE Florida
135 posts, read 437,776 times
Reputation: 54
Default Mike some questions again...

Ok, my husband will only be 41 at retirement/drawing age. It is a pension from our local police dept, is that considered government?

How does this pertain to us and how we'd be taxed if we moved to CO? Thanks so much.
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Old 12-17-2006, 10:52 AM
 
1,904 posts, read 4,636,622 times
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I've been researching the same thing and from what I have found out, you basically pay state income tax (5%) on your retirement income, whether that is a government pension or retirement from private industry. Once you reach 55 years of age you qualify for the $20K exemption.

What do you think Mike, do I have this right?

We currently live in a state (Texas) that has no income tax and doesn't tax retirement income, but we're still moving to Colorado. You have to look at more than one tax when considering where to live. I have found that it basically all equals out in the long run in most states. For instance, in Texas my property taxes are over $10K a year. They will be much lower in Colorado but we'll have to pay 5% income tax. It all equals out.

Here's the important thing, Colorado is absolutely gorgeous and we love it there! That's all that matters in the long run.
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Old 12-17-2006, 11:03 AM
 
17,373 posts, read 24,625,888 times
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Austin Traveler....that's right. My wife took an early pension and didn't get the deduction, but will when she is 55.
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Old 12-17-2006, 12:49 PM
 
1,904 posts, read 4,636,622 times
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Thanks for the info Mike!!
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Old 12-18-2006, 02:58 AM
 
Location: IE CA.
377 posts, read 1,434,895 times
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Thank you so much for the info ... My parents are worried about moving from WA as both are former State Workers and my Dad retired Military as well. I very well may have several questions for you tomorrow I hope you dont mind! Have a nice night ...
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Old 03-05-2010, 08:43 AM
 
1 posts, read 11,968 times
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Question on State Tax. I am a Colorado resident and earn income from Wyoming State Govt, do I have to pay state tax on that income?

I also am retired military but am 47 and understant I have to pay tax on that pension till age 55 when I get a $20,000 exemption.
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Old 03-05-2010, 02:32 PM
 
16,448 posts, read 10,785,861 times
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Quote:
Originally Posted by AustinTraveler View Post
For instance, in Texas my property taxes are over $10K a year. They will be much lower in Colorado but we'll have to pay 5% income tax. It all equals out.
This low prop tax will likely change in the near future. Also look for TX to start an income tax. FWIW

I'm from Texas, but Colorado is for me.
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Old 03-06-2010, 10:48 AM
 
Location: cemetary
363 posts, read 558,116 times
Reputation: 189
Quote:
Originally Posted by bterence View Post
Question on State Tax. I am a Colorado resident and earn income from Wyoming State Govt, do I have to pay state tax on that income?
I believe so.

I had to pay on income earned in South Dakota. Just remember you are paying a percentage of your Fed Tax liability.

Last edited by plainsman48; 03-06-2010 at 11:01 AM..
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