Tax burden in MA vs NH (Boston, Newton: mortgage, houses, preschool)

[cali2east]

Didn't know if this was the best place to post this and I posted in the NH forum as well, but I was wondering about how people feel about tax burden in one state vs the other. I'm taking a field-based position and will be relocating to the Northeast. Outside of my home, my business will primarily be in Boston (2-3X/wk). If we were to settle in NH, I'd only have to pay NH property taxes - is that right? I've heard of people living in NH and working in Boston and so they are taxed by both states. I can't imagine a situation where MA would tax us since my primary residence would be NH and corporate headquarters is in Chicago. Aside from contacting an accountant, just wanted to see if anyone knew anything about this. We have a large family, so we're looking to settle into a nice, family-friendly town (w/a vibrant town center), houses that are in the $350-$400K range for a 4-bdrm w/plenty of backyard space. I know this is a tall order in a Boston suburb, which is why we're thinking to look in NH. Does anyone have any suggestions for towns that is convenient to commuter rail into Boston? Thanks so much!

[holden125]

I'm not sure that Chicago HQ makes much of a difference, but if you are working even 2/3 days a week out of an actual field office in Mass. you will likely to be taxed in Mass., while if you are not based out of a particular field office based in Mass. you're unlikely to be taxed in Mass. Will you be a free floater essentially based out of your home (or the home office) but roaming around the area for your job, or is there a Boston-based office?

The commuter rail does not go to Boston from NH. The last stops are in Mass. on all lines to the north. The Anderson/Woburn station is right off 93 just north of the 128 interchange, and it is about half an hour to North Station from there. Ample parking. You have to get to the station first, and there's a bit of a drive from, say, Salem, NH to Anderson/Woburn, and there is some traffic if you do it during a rush hour. There are other stations closer to the line but with less parking available, and farther from the highway.

There are many towns on the rail, "convenient" depends on which line, how far out, which station in Boston you prefer to go into, how easy to park at the train (some have small lots, fill early, big problem). Some lines going out of South Station have no trains between 6:30 and 8:30 PM. A long wait if you get held up at work.

Here is the map:
http://www.mbta.com/schedules%5Fand%5Fmaps/rail/

A house like you seek is indeed a tall order as you get close to Boston but is doable within Mass. without going too, too far. Mass. income tax is 5.3%, which is clearly higher than NH's 0% but could be offset, depending on your income level, by property tax disparities. The towns in NH along the MA border with better schools, etc., often have high property taxes to make up for the lack of state support. At a higher income you absorb that difference more easily and see in your pocket the lack of an income tax, but more moderate incomes might pay more in property tax in NH than they'd pay to MA for income tax and property tax combined. Obviously the worst situation is to pay MA income tax AND NH property tax, so if you are going to be taxed in MA you should probably live in MA as well. There is also the cost of the gas, etc. getting around. NH towns are more rural and spread out, and you'd also have to drive 50 miles a day to get to and from a place like Anderson/Woburn.

Not sure what it's like where you live, but NH towns also have sparse services (often no town trash collection) and are very dark and quiet at night. There is very little up there and that is often a surprise to newcomers.

I'd suggest determining whether you'll pay Mass. income tax first, then where the location is you'd have to go in Boston. It can make a significant difference in terms of the convenience of commuting by train (e.g. a lot easier to live near a train going into South Station, not North Station, if you work near South Station). Some offices are not really convenient to either train station, or to Back Bay Station. Someone here was taking a position at WGBH, which is located in Brighton (NW corner of the city of Boston, near Brookline and Newton). To get there from any commuter rail station would take almost an hour in itself, not counting the actual commuter rail time. For that job, you kind of have to live real close to it or drive the whole way.

[cali2east]

Thanks for the extensive information. I believe I will not be obligated to pay MA tax as, yes, I am a free-floater based out of a home office (my territory includes MA, NH, VT, ME, CT, RI). I have client meetings (primarily w/physicians and researchers) sporadically throughout my territory but will be focused on Boston and the hospitals and research universities located within. I will also be doing some national and international travel so access to the airport would be nice (commuter rail will again come in handy here). You talk about a higher income absorbing the difference between high property tax and no income tax - would $120K fall in that range? I'm not sure what high income involves as here in Southern CA, that salary is not considered a high income by any means. I'm not too worried about cost of gas as this is subsidized by my company. My time at home and quality of life are much more important for me as we have 3 young children at home. My husband is a stay-at-home dad so a town that has places to take the kids when they've got cabin fever (parks, ponds, indoor playgrounds) would be nice. Our oldest is also soon to enter preschool and with two others following close behind, so good quality schools is also essential.

[holden125]

It gets hard to pinpoint as taxes are so complex. It depends on your deductions and such, as the main issue is comparing the actual Mass. income tax paid on your final taxable income for Mass. state income tax purposes, to the difference in property tax. Say (I am just making up the numbers, Val C. would know better) you would pay $4,000 in property tax in Mass. and $8,500 in N.H. for a comparable house. If you are paying Mass. state taxes on a final adjusted income of $80,000, that would be $4,240 or so. The $4,500 you pay in extra property taxes more than offsets the $4,240 you save. I am not sure, after deducting for kids and mortgage interest and so on, what the taxable income would be for $120,000.

In my book, if you're going to break even, or close, it's not worth it to drive another 25 minutes each way and not be home. Though, due to the shape of Mass. and the road structure, there are plenty of towns in Mass. that would require more driving to get to Boston (or the train to Boston) than, say, Salem, N.H., a straight shot on 93. It's important to research the options for getting there and how long they take, as towns that look to be the same distance from Boston can take a very different amount of time due to the roads.

Commuter rail to the airport is dicey from the north. From the south or west (trains going into South Station) there is the silver line from South Station direct into the airport. Still adds some time to the trip, but it's direct. Coming into North Station, as far as I know, you'd have to take the Orange line to the Blue line at State St. and change platforms in the middle of the city, luggage and all. From the west, about Framigham, there is a shuttle bus to Logan. I know there is also a bus from Concord and Manchester, but not sure about anywhere between Boston and Manchester. Manchester Airport is increasingly used for domestic flights.

I do not know the ins-and-outs of every town but most Mass. towns have public kindergarten, but not public pre-school that I'm aware of. In N.H. it's not unheard of for a town not to have public kindergarten. There is a complaint from some longtime N.H. residents that Mass. people move in and expect all kinds of services that N.H., which is a rural state not overrun with amenities, traditionally doesn't have. Personally my rural threshold stops about 15 minutes from Boston, so I wouldn't want to move there except maybe one of the cities. If you are used to Southern California, you might want to get a better sense of what N.H. is like before moving there.

[tmclaughlin11]

This is a bit late, but Anderson/Woburn does have shuttle buses to Logan. For that matter, it also has shuttles to Manchester Airport.