new to forum, tax question (calculator, income, income tax)

[kikiart_4U]

Anyone know if bonds,dividends retirement accounts are taxed and at what percent? Looking at possibly New Mexico or Tennessee ( family) for retirement. However learned Tennessee taxes your dividends, bonds etc at
6%. Thanks.

[yukon]

You can lookup personal income tax for NM at this site, looks confusing on the monitor but once you print it out and can see the footnotes, it's not so bad.

http://www.taxadmin.org/fta/rate/ind_inc.html

[jb124]

Here's the NM-specific table:

7-2-7. INDIVIDUAL INCOME TAX RATES.--The tax imposed by Section
7-2-3 NMSA 1978 shall be at the following rates for any taxable year beginning on or after January 1, 2007:

A. For married individuals filing separate returns:
If the taxable income is: The tax shall be:
Not over $4,000 1.7% of taxable income
Over $ 4,000 but not over $ 8,000 $ 68.00 plus 3.2% of excess over $ 4,000
Over $ 8,000 but not over $ 12,000 $ 196 plus 4.7% of excess over $ 8,000
Over $ 12,000 $ 384 plus 4.9% of excess over $ 12,000.

B. For surviving spouses and married individuals filing joint returns:
If the taxable income is: The tax shall be:
Not over $8,000 1.7% of taxable income
Over $ 8,000 but not over $ 16,000 $ 136 plus 3.2% of excess over $ 8,000
Over $ 16,000 but not over $ 24,000 $ 392 plus 4.7% of excess over $ 16,000
Over $ 24,000 $ 768 plus 4.9% of excess over $ 24,000.

C. For single individuals and for estates and trusts:
If the taxable income is: The tax shall be:
Not over $5,500 1.7% of taxable income
Over $ 5,500 but not over $ 11,000 $ 93.50 plus 3.2% of excess over $ 5,500
Over $ 11,000 but not over $ 16,000 $ 269.50 plus 4.7% of excess over $ 11,000
Over $ 16,000 $ 504.50 plus 4.9% of excess over $ 16,000.

D. For heads of household filing returns:
If the taxable income is: The tax shall be:
Not over $7,000 1.7% of taxable income
Over $ 7,000 but not over $ 14,000 $ 119 plus 3.2% of excess over $ 7,000
Over $ 14,000 but not over $ 20,000 $ 343 plus 4.7% of excess over $ 14,000
Over $ 20,000 $ 625 plus 4.9% of excess over $ 20,000.

E. The tax on the sum of any lump-sum amounts included in net income is an amount equal to five multiplied by the difference between:
(1) the amount of tax due on the taxpayer's taxable income; and
(2) the amount of tax that would be due on an amount equal to the taxpayer's taxable income and twenty percent of the taxpayer's lump-sum amounts included in net income.
(Laws 2003, Chapter 2, Section 6)

[nodule11]

Just punch in the nymbers with an income tax calculator try, [url=http://www.income-tax-calculator.org]Income Tax Calculator - Calculate your income taxes[/url]

[jiminnm]

New Mexico uses your federal taxable income as a basis for state income tax, subject to certain adjustments (form PIT-ADJ).

I always advise that you use the state's web site, not a third party site, for this info. Start here:
http://www.tax.state.nm.us/forms/year08/individual.htm

[loborick]

jim is right. If it is taxable by the feds, it'll be taxable in NM.

[Bear's Mom]

Seems like I read somewhere that SS income in NOT taxed (state) in NM.
Can someone confirm that?

I imagine all of the $$#'s reference in earlier posts are going to be much higher in the future!

thanks.
good info

[Poncho_NM]

Originally Posted by Bear's Mom

Seems like I read somewhere that SS income in NOT taxed (state) in NM.

If you pay Federal tax on SS Income, then you probably will pay tax on it in NM:



http://www.tax.state.nm.us/tax/trd_ques.htm#pit

New Mexico imposes a tax on the net income of every resident. Residents are taxed on the net income from employment, unearned income, gambling, pensions, annuities, and income from real or personal property in this state or from businesses located in this state.

New Mexico's personal income tax "piggybacks" on the federal return and uses the federal adjusted gross income figure as its base. Net income usually equals federal taxable income, although some special deductions are available. New Mexico uses the same dollar amounts as the federal government for personal exemptions, standard deductions and itemized deductions.

Rich

[mortimer]

Originally Posted by kikiart_4U

However learned Tennessee taxes your dividends, bonds etc at 6%.

According to here:
Tax Tables for bond income by state.
Tennessee taxes at 6% if you make more than $1,250 per person
in your household. ( I looked it up thinking it would be like NM
that just lumps it into overall taxable income as it should. )

In NM if you have taxable bond income of $10,000 or more, it's 4.7%.
Effectively, there is no difference between NM and TN if you are living
on bond income. For $10k income, you pay $130 more tax in NM - BFD.

If you have $100k bond income, your rate is 4.9% and the difference
is $1,100. Again, BFD. (*)

BTW, in TN, if you have taxable bond income of $11,500, your effective
tax rate is 4.7% due to the $2,500 exclusion. All income above that is
at the 6% rate.

Life's too short to live where you don't like it. When you retire, choose the
place that you like the best and figure out how to live within your means.
Picking a place based on saving a few dollars in taxes is just nuts.

(*) Big Friggin' Deal <--- I don't cuss on the forum.

[mrgoodwx]

Originally Posted by mortimer

Life's too short to live where you don't like it. When you retire, choose the place that you like the best and figure out how to live within your means. Picking a place based on saving a few dollars in taxes is just nuts. (*) Big Friggin' Deal <--- I don't cuss on the forum.

It looks like the original poster disappeared from the forum about 2 1/2 years ago. Still...it's a good topic. I would add to Mortimer's comment: These days, considering the financial health (or lack of) of so many states, it would be very risky to place a lot of emphasis on the present tax structure of a state. Expect taxes for many states to change at a rate not seen in years beginning next year. So...if one is choosing to move to a state because of any tax advantages, by the time they actually get up and make the move, taxes in their "state of choice" may have changed (uh...risen) drastically!