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Old 11-18-2013, 07:32 AM
 
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Maine is one of my favorite states. I've heard the taxes are really high there. Is this true?
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Old 11-18-2013, 08:01 AM
 
Location: Bangor Maine
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Realestate taxes are set by the idividual town you live in. Some are high and some are low. The sales tax now is 5.5%. The town I live in it is considered high by some standards. I think, but not absolutely sure, it is about $21 per thousand. I don't have my tax bill in front of me. I guess compared to New Jersey our taxes are low. I know that NH has no sales tax but their realesate tax is very high.
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Old 11-18-2013, 11:18 AM
 
Location: Maine
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Everyone tells me it's high. But we make less money in Maine than we did in Washington State (which has no state income tax), and our quality of life is FAR higher in Maine than we had in Washington.

How that shakes down ... I couldn't tell you. But it does.
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Old 11-18-2013, 11:23 AM
 
Location: Somewhere in deep in Maine
3,658 posts, read 2,792,381 times
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The state income tax has a feature that is often not considered. Whether this impact you strongly depends on whether you live in the interior or the coast. In many states, local taxes are a deduction. This deduction is often not much more than a couple of hundred bucks off of your state income tax bill.
Also in Maine, local taxes are one lump sum. In many states the local government is different than the government operation that runs the schools. So you have local taxes, county taxes, and school taxes, all with separate agencies. Only your local municipal agency is often a deduction.

But in Maine, local taxes are a credit. This means that you can take the total of your local tax bill off the amount that you owe the state. Since you owe the state no matter what, this is a huge thing. For example, I have a cousin who lives in PA. She has to pay $3000 in school taxes and 1.5% of her income in county taxes, . She has to pay 6% of her income in state taxes. Lets suppose she made $100K a year. She would have to pay $6000 in state taxes, and $1500 in county taxes and $3000 in school taxes. In PA her total state and local taxes would be about $10,300. She would get about $200 in deduction from her state taxes for her local taxes. But in Maine, she pays maybe $5500 in state taxes. Instead of being nickel and dimed to death by different agencies, the local agency is just the town and it pays also for the school, and so her local taxes are also her real estate taxes so she live on the coast and its a high $2200 a year. But instead of having to pay $7500 total, she actually pays $3300 total since the local taxes are deducted completely from her state tax bill.

Most Mainers don't know what a deal they have with their local taxes being a credit on state taxes. Most other places, its a tiny little deduction. Of course, if Maine did it like PA or other states do, they could out of their budget conundrum very very fast. But people would freak big time.

I like the Maine way.
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Old 11-18-2013, 01:42 PM
 
Location: Forests of Maine
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From our experience, our taxes dropped significantly when we moved to Maine.

How your taxes will change will be largely up to you. If you lived in a high tax area before, where you go in Maine, and how you live once your here.

Generations old tribal knowledge here includes the idea that Maine's taxes are the highest in the nation. If you question this, or if you point out how your taxes were higher at a previous home; folks here may become angry at you. Because you are defiling their tribal knowledge.
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Old 11-18-2013, 03:45 PM
 
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foodservice/restaurants/lodging,,,,that tax is around 7% im thinking it just went up recently
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Old 11-19-2013, 08:04 AM
 
Location: Somewhere in deep in Maine
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Quote:
Originally Posted by Submariner View Post
folks here may become angry at you. Because you are defiling their tribal knowledge.
I love it! Tribal knowledge!
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Old 11-19-2013, 08:07 AM
 
Location: Somewhere in deep in Maine
3,658 posts, read 2,792,381 times
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Quote:
Originally Posted by 3l7e2t5i View Post
The Pine Tree State, like the majority of states, exempts Social Security benefits from state income taxes. Up to $6,000 per person of eligible pension income can be deducted.
A deduction is not the same as a credit. Credit is the whole thing; deduction is some miniscule amount.

You really need a computer program or a tax consultant to figure the whole thing out. Its way too convoluted for an average Joe to compute.
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Old 11-19-2013, 09:11 AM
 
Location: Central Maine
1,472 posts, read 2,694,328 times
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The tax burden on Mainers has been so often documented here that I'm not going to go through it again. If the OP does a search, he/she will find lots of independent research on the matter. Maine's taxes are very high. Don't let anecdotal "stories" stand in the way of the cold, hard, truth. Those citing "tribal knowledge" as being the source of the research are just trying to trivialize reality and sugarcoat the taxes here.
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Old 11-19-2013, 10:10 AM
 
68 posts, read 167,050 times
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Quote:
Originally Posted by slyfox2 View Post
But in Maine, she pays maybe $5500 in state taxes. Instead of being nickel and dimed to death by different agencies, the local agency is just the town and it pays also for the school, and so her local taxes are also her real estate taxes so she live on the coast and its a high $2200 a year. But instead of having to pay $7500 total, she actually pays $3300 total since the local taxes are deducted completely from her state tax bill.

Most Mainers don't know what a deal they have with their local taxes being a credit on state taxes. Most other places, its a tiny little deduction. Of course, if Maine did it like PA or other states do, they could out of their budget conundrum very very fast. But people would freak big time.

I like the Maine way.
I have either misunderstood the Maine tax laws my entire life or your friend is way out in left field in how she deducts her property tax. The amount one pays in property tax comes off your gross income, not the actual tax. This translates to much less off your actual tax. In the example you gave, it may mean a $500 difference, not $2,200. Her total income tax would be $5,000 (hypothetically), not $3,300 as you stated.

Somebody please correct me if I am wrong in this.
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