U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Retirement
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 05-23-2014, 08:51 AM
 
Location: Central Massachusetts
4,800 posts, read 4,842,106 times
Reputation: 6377

Advertisements

Quote:
Originally Posted by CSRSJim View Post
Everybody should do their own analysis, counting all the things mentioned by the various posters.
If person A has a million dollar per year retirement income, then income tax is a big cost.
If person B only has social security income, then income tax is not a big cost.

Person C may own a large home with high property taxes, ultilities, etc.
Person D may rent an efficiency apartment with low ultility costs and the property taxes are included in rent (and likely small).

In my opinion, sales tax is not as big a factor as many people think. Typically (check your own) the amount spent per year on items with sales tax is much smaller than the income that is taxed by both the feds and many states. But a state/locality with high sales tax can drive the cost of a new car, some people keep a car for 10 years, others 2-3 years.

Exactly right CSRS. Sales taxes as well as other taxes themselves are not as much an issue as is your situation. There are a number of tax strategies that can make up for sales taxes and even high property or income taxes. A sales tax is the least problematic as it is a user tax. If'n you dont want to pay that tax don't buy that item.

A case in point on that is in SC and for you S Carolinians please do not take offense. I am just using your state for this example. There are a number of other states that have issues too. But to the point here SC has in their books that sales taxes can be added from state, county and city/town. This can add up. I recently went to a SC resturaunt and had a wonderful meal. When it was all done and I got my check I noticed all the sales taxes added to the bill. It broke it down nicely and was a bit of a shocker since in our state we do not have that.

I am not complaining just making that point. Taxes need to be considered as well as COL, living conditions, quality of life, and family/friends. All of that should be part of your planning. If'n you're married/committed then your partner needs to be part of that process. It is an evolving and fluid plan until you make that switch from one life to another as I understand what retirement is going to be in my case.

It is all something that can consume you or just drive you. Which then provides us with a topic to discuss.
Reply With Quote Quick reply to this message

 
Old 05-23-2014, 11:12 AM
 
14,253 posts, read 23,969,886 times
Reputation: 20025
Quote:
Originally Posted by Robyn55 View Post
Yes - Stubhub would work for someone who lives in a particular area or knows his/her plans in advance. And - at least in Houston - there were "scalpers" on the street. Apparently they can buy up "cheap seats" from season ticket holders for $2-3 - and sell them for $5 (the seats are $7 at the box office).

Your "get a good meal before the game" is a sound plan - at least in Houston. My husband and I were most disappointed that the peanuts came in a sealed plastic bag - and tasted old and stale.

If you're ever in JAX during the season - catch a Suns game. We have a pretty new stadium - and it's really nice (although nothing compared to the Astros stadium in Houston - which has a retractable roof). Robyn


Robyn,

You are right. SOMETIMES you can do better buying from scalpers. However, I hate to bring out a wad of bills in front of someone I don't know. And in some parks those guys look pretty shady.

Where we have had great luck is wondering around the park and hoping someone has an extra ticket. In St. Louis, a lady gave us two great tickets adjacent to Cardinals game adjacent to the TBS camera behind the plate. That was great. We always OFFER to pay but most people don't care. By the way, if someone gives you FREE tickets, buy the first round of drinks for them and a couple of hot dogs.

Then there was the one GOOD scalper story. As I parked my car at Anaheim stadium, a scalper offers to sell me a ticket. I negotiate a more reasonable price. As I am pulling out my wallet, an Anaheim cop slaps his badge on my car. The scalper says, "officer, I am NOT selling the ticket, I am giving it to my friend." The cop chased him from the lot ... and I had a ticket.

We buy our own peanuts and snacks. The Brewers do NOT care if you bring in outside food as long as there are no bottles and cans and you are NOT sitting in the luxury suites.
Reply With Quote Quick reply to this message
 
Old 05-23-2014, 11:30 AM
 
Location: Los Angeles area
14,018 posts, read 17,723,738 times
Reputation: 32304
Quote:
Originally Posted by CSRSJim View Post
Everybody should do their own analysis, counting all the things mentioned by the various posters.
If person A has a million dollar per year retirement income, then income tax is a big cost.
If person B only has social security income, then income tax is not a big cost.

Person C may own a large home with high property taxes, ultilities, etc.
Person D may rent an efficiency apartment with low ultility costs and the property taxes are included in rent (and likely small).

In my opinion, sales tax is not as big a factor as many people think. Typically (check your own) the amount spent per year on items with sales tax is much smaller than the income that is taxed by both the feds and many states. But a state/locality with high sales tax can drive the cost of a new car, some people keep a car for 10 years, others 2-3 years.
CSRSJim, you have an uncommon quality - common sense. What you are talking about accounts for a lot of the talking past each other that we observe here in the retirement forum.
Reply With Quote Quick reply to this message
 
Old 05-23-2014, 03:20 PM
 
Location: Lakewood OH
21,699 posts, read 23,648,620 times
Reputation: 35449
Quote:
Originally Posted by golfingduo View Post
Exactly right CSRS. Sales taxes as well as other taxes themselves are not as much an issue as is your situation. There are a number of tax strategies that can make up for sales taxes and even high property or income taxes. A sales tax is the least problematic as it is a user tax. If'n you dont want to pay that tax don't buy that item.

A case in point on that is in SC and for you S Carolinians please do not take offense. I am just using your state for this example. There are a number of other states that have issues too. But to the point here SC has in their books that sales taxes can be added from state, county and city/town. This can add up. I recently went to a SC restaurant and had a wonderful meal. When it was all done and I got my check I noticed all the sales taxes added to the bill. It broke it down nicely and was a bit of a shocker since in our state we do not have that.

I am not complaining just making that point. Taxes need to be considered as well as COL, living conditions, quality of life, and family/friends. All of that should be part of your planning. If'n you're married/committed then your partner needs to be part of that process. It is an evolving and fluid plan until you make that switch from one life to another as I understand what retirement is going to be in my case.

It is all something that can consume you or just drive you. Which then provides us with a topic to discuss.
In reading your very well written post I want to add that I didn't mean to give the impression that I didn't think that taxes shouldn't be taken into consideration in my last post but I probably did.

It seems though that in reading many of the comments here I get the impression that the thoughts are it's only one way or another but I think in reality it's a little bit of both. It all depends upon a person's financial situation.

Taking mine into consideration, I don't buy big ticket items so moving from a place with no sales tax to a place that has it won't be a big deal for me. For someone else it might be. I usually don't have to pay income tax because I don't earn enough with my retirement benefits but many do. And I sometimes have large enough medical co-pays to offset them anyway. And so on.

If someone has investment income or property on which taxes are owed at the end of the year, that's something to take into consideration. The tax situation in a new area will be of importance to them.

So yes, absolutely, taxes can be a factor into one's decision to choose a relocation spot depending upon budget and financial circumstances.
Reply With Quote Quick reply to this message
 
Old 05-23-2014, 10:02 PM
 
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
22,525 posts, read 39,903,732 times
Reputation: 23629
Quote:
Originally Posted by Minervah View Post
...
If someone has investment income or property on which taxes are owed at the end of the year, that's something to take into consideration. The tax situation in a new area will be of importance to them.

So yes, absolutely, taxes can be a factor into one's decision to choose a relocation spot depending upon budget and financial circumstances.
Thus, a strategic move to a "border area" is a motivator for many relocation's, but is a bit limited in geographies.
Living in an income tax free state and driving 5 minutes to shop in a sales tax free state.
Registering vehicles in an LLC that you form in a 'sales tax free state' (be legal...rules and potential penalties exist)
  • Holding your domicile and your income properties in income tax free states.
  • Forming your businesses in tax free states (or US protectorates, very common with internet businesses and corporations)
  • Tailoring your income to miss tax thresh-holds (I would assume most of us already do this if possible)
  • There are some states that have a pretty equitable and moderate tax structure (Property, sales, income...)
Certainly 'medium-high rollers' are prudent to consider tax implications of a relocation. For the rest of us serfs, it may not be a big enough difference to sway the decision.

My FIL moved from CO to OR in late retirement and took a big hit, tho I hope to eventually get him to WA.
I moved to an income tax free state when I was age 25, and during my earning yrs. It was a big help in getting to critical mass before age 50 (on a single income hourly wage).

I stay for convenience, and have structured my income and assets and trust / LLC's with tax planning objectives. But I really dislike my $14,400 in annual property taxes (I built it for under $100k, but the assessor really seems to like it). At the moment I have chosen to stay and enjoy the view and 20 minute commute to international airport. I bought a 'retirement' home 2 minutes away that is taxed 1/10th, so if I ever choose to sell Casa Grande, I can 'retreat' to a low property tax alternative. (It is in a different county, school and fire district)

I keep income property in TX (Income Tax Free) that I can also retreat to ($1700 Property tax)
Adding props in SD and TN (Income tax free)

I tend to shop "in-state" (and pay sales tax to support local businesses (my tenants)), but I am no longer in "Accumulation mode"

If I ever get a high dollar RV, I will change my domicile to SD (only one 24 hr period stay is necessary to meet residency), and register RV in MT LLC. Of course you need to stay on the move to be very careful to not trigger domicile in tax hungry states like CA. It is not hard to remain in compliance and avoid triggering unnecessary State taxation.


Just like portfolio planning and management, consider the 'end game', as well as your risk profile (or environmental / community / family / financial needs) in the case of strategic relocation planning.

Thank goodness we all have different criteria.
Reply With Quote Quick reply to this message
 
Old 05-24-2014, 05:45 AM
 
Location: Near a river
16,042 posts, read 18,964,817 times
Reputation: 15649
Quote:
Originally Posted by CSRSJim View Post
Everybody should do their own analysis, counting all the things mentioned by the various posters.
If person A has a million dollar per year retirement income, then income tax is a big cost.
If person B only has social security income, then income tax is not a big cost.

Person C may own a large home with high property taxes, ultilities, etc.
Person D may rent an efficiency apartment with low ultility costs and the property taxes are included in rent (and likely small).

In my opinion, sales tax is not as big a factor as many people think. Typically (check your own) the amount spent per year on items with sales tax is much smaller than the income that is taxed by both the feds and many states. But a state/locality with high sales tax can drive the cost of a new car, some people keep a car for 10 years, others 2-3 years.
This is why those silly retirement advice articles ("Low COL states," etc.) fail to make sense. They assume a common set of circumstances, so common that their "advice" proves meaningless.

As for sales tax, for large ticket items (or even food and clothing, for that matter), if one is close to another state that has none, it's a simple drive over the border once or twice a month (unless of course you reside in the middle of say North Dakota).
Reply With Quote Quick reply to this message
 
Old 05-24-2014, 05:50 AM
 
Location: Central Massachusetts
4,800 posts, read 4,842,106 times
Reputation: 6377
NORTH DAKOTA

Sales Taxes

State Sales Tax: 5% (food and prescription drugs exempt); 6% on lodging, 7% on alcoholic beverages. Cities or counties which have adopted home rule charters may levy additional sales and use taxes up to 3.0%.
Gasoline Tax: 41.4 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 47.4 cents/gallon (Includes all taxes)
Cigarette Tax: 44 cents/pack of 20
Personal Income Taxes

Tax Rate Range: * Low – 1.51%; High – 3.99%
Income Brackets: *Lowest – $35,350; Highest – $388,350 (2013) (See tax table)
Number of Brackets: 5 The tax brackets reported are for single individuals. For married taxpayers the same rates apply to income brackets ranging from $59,100 to $388,350. An additional $300 personal exemption is allowed for joint returns or unmarried head of household.
Personal Exemptions: ** Single – $3,900; Married – $7,800; Dependents – $3,900. There is also a new marriage income tax credit with a maximum limit of $300.
Standard Deduction: Federal amount ($6,100 – single, $12,200 – joint; single over 65 – $1,400; married $1,100))
Medical/Dental Deduction: Full
Federal Income Tax Deduction: *None
Retirement Income Taxes: A total of $5,000 can be excluded from military, civil service, some state/local government, and qualified pensions, minus amount of Social Security received. Out-of-state government pensions are fully taxed. Call 701-328-3275 for more information.
Retired Military pay: North Dakota’s individual income tax law provides only one special deduction for active members of the military. It does not include combat pay that is exempt from federal income tax. The current income tax law does not provide for any special deductions for retired military members.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.
Property Taxes

All real property in the state is subject to tax by the state, counties, townships, and municipalities. Residential property is taxed as 9% of assessed value. For the most part, personal property is exempt from property tax. Personal property of utilities companies that are assessed by the State board of Equalization is subject to property tax. Household personal property, inventories, and machinery and equipment used in trade or manufacture are exempt from property taxes. Machinery and equipment used in refining products from oil or gas extracted from the earth is deemed to be real property and therefore subject to property taxes. A mobile home used as a residence or place of business is also subject to a property tax.
There is also a Homestead Tax Credit available to senior citizens (65+) or disabled persons who own or rent their home. Your income, plus the income of your spouse and any dependents, may not exceed $26,000 for the calendar year preceding the assessment date. Your assets may not exceed $75,000. The maximum homestead credit is $4,500 (income $0 to $18,000). Click here for details. For a brochure on the Homestead Tax Credit, click here. Call 701-328-3127 for details.
Inheritance and Estate Taxes

North Dakota does not have an inheritance tax. There is an estate tax based on a decedent’s total gross estate and limited to the credit for state death taxes allowed on the Federal 706 estate tax return. North Dakota’s definition of a deceased person’s taxable estate is identical to the federal definition and North Dakota recognizes all federal exemptions and deductions.
Reply With Quote Quick reply to this message
 
Old 05-24-2014, 06:00 AM
 
2,626 posts, read 4,948,496 times
Reputation: 2220
Quote:
Originally Posted by golfingduo View Post
NORTH DAKOTA

Sales Taxes

State Sales Tax: 5% (food and prescription drugs exempt); 6% on lodging, 7% on alcoholic beverages. Cities or counties which have adopted home rule charters may levy additional sales and use taxes up to 3.0%.
Gasoline Tax: 41.4 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 47.4 cents/gallon (Includes all taxes)
Cigarette Tax: 44 cents/pack of 20
Personal Income Taxes

Tax Rate Range: * Low – 1.51%; High – 3.99%
Income Brackets: *Lowest – $35,350; Highest – $388,350 (2013) (See tax table)
Number of Brackets: 5 The tax brackets reported are for single individuals. For married taxpayers the same rates apply to income brackets ranging from $59,100 to $388,350. An additional $300 personal exemption is allowed for joint returns or unmarried head of household.
Personal Exemptions: ** Single – $3,900; Married – $7,800; Dependents – $3,900. There is also a new marriage income tax credit with a maximum limit of $300.
Standard Deduction: Federal amount ($6,100 – single, $12,200 – joint; single over 65 – $1,400; married $1,100))
Medical/Dental Deduction: Full
Federal Income Tax Deduction: *None
Retirement Income Taxes: A total of $5,000 can be excluded from military, civil service, some state/local government, and qualified pensions, minus amount of Social Security received. Out-of-state government pensions are fully taxed. Call 701-328-3275 for more information.
Retired Military pay: North Dakota’s individual income tax law provides only one special deduction for active members of the military. It does not include combat pay that is exempt from federal income tax. The current income tax law does not provide for any special deductions for retired military members.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.
Property Taxes

All real property in the state is subject to tax by the state, counties, townships, and municipalities. Residential property is taxed as 9% of assessed value. For the most part, personal property is exempt from property tax. Personal property of utilities companies that are assessed by the State board of Equalization is subject to property tax. Household personal property, inventories, and machinery and equipment used in trade or manufacture are exempt from property taxes. Machinery and equipment used in refining products from oil or gas extracted from the earth is deemed to be real property and therefore subject to property taxes. A mobile home used as a residence or place of business is also subject to a property tax.
There is also a Homestead Tax Credit available to senior citizens (65+) or disabled persons who own or rent their home. Your income, plus the income of your spouse and any dependents, may not exceed $26,000 for the calendar year preceding the assessment date. Your assets may not exceed $75,000. The maximum homestead credit is $4,500 (income $0 to $18,000). Click here for details. For a brochure on the Homestead Tax Credit, click here. Call 701-328-3127 for details.
Inheritance and Estate Taxes

North Dakota does not have an inheritance tax. There is an estate tax based on a decedent’s total gross estate and limited to the credit for state death taxes allowed on the Federal 706 estate tax return. North Dakota’s definition of a deceased person’s taxable estate is identical to the federal definition and North Dakota recognizes all federal exemptions and deductions.
What about Indiana?
Reply With Quote Quick reply to this message
 
Old 05-24-2014, 06:03 AM
 
Location: Central Massachusetts
4,800 posts, read 4,842,106 times
Reputation: 6377
Per your request

INDIANA

Sales Taxes

State Sales Tax: 7% (food and prescription drugs exempt)
Gasoline Tax: 56.6 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 74.6 cents/gallon (Includes all taxes)
Cigarette Tax: 99.5 cents/pack of 20
Personal Income Taxes

Tax Rate Range: Flat rate of 3.4% of federal adjusted gross income. See tax info. Also click here. Counties also have the authority for a local option income tax whose goal is to provide income for the counties instead of raising property taxes. Carroll, Clark, Clay, Madison and Wabash counties have adopted new county option income rates. For details, click here and here.
Personal Exemptions: Single – $1,000; Married – $2,000; Dependents – $1,500; $1,000 for taxpayer and/or spouse if age 65 or over; $1,000 for taxpayer and/or spouse if blind; $500 additional exemption for each individual age 65 or over if federal adjusted gross income is less than $40,000.
Standard Deduction: None
Medical/Dental Deduction: None
Federal Income Tax Deduction: None
Retirement Income Taxes: Social Security is exempt. Taxpayers 60 and older may exclude $2,000 from military pensions minus the amount of Social Security and Railroad Benefits received. Taxpayers age 62 and older may deduct from their adjusted gross income $2,000 from a federal civil service annuity. Out-of-state pensions are fully taxed. Homeowners can deduct up to $2,500 from their income taxes for property taxes on their residence. To view information for seniors, click here.
Retired Military Pay: Military retirees who are age 60 are entitled to deduct up to $5,000 of military or survivor benefits.
Active Duty or Reserve Military Pay: Military personnel (regardless of age) on active duty or in the reserves may deduct up to $5,000 of taxable military pay if it is not already excluded or deducted from their adjusted gross income.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.
Property Taxes

Property taxes in Indiana are administered at the local level with oversight by the Indiana Department of Local Government Finance. They are imposed on both real and personal property. Property, which is assessed at 100% of its true value, is subject to taxation by a variety of taxing units (schools, counties, townships, cities and towns, libraries, etc.) making the total tax rate the sum of the tax rates imposed by all of the taxing units in which the property is located. Homeowners are eligible for a credit against the property taxes that they pay on their homestead. The amount of credit to which the individual is entitled equals 10% of the individual’s property tax liability, which is attributable to the homestead during the calendar year. A taxpayer entitled to receive a homestead credit is also entitled to a standard deduction from the assessed value of the homestead. The deduction is the lesser of one-half of the assessed value of the real property or $35,000. Homeowners 65 and older who earn $25,000 or less are eligible to receive a tax reduction on property with an assessed value of $182,430 or less and the individual received no other property tax deductions except for mortgage, standard, and fertilizer storage deductions. Click here for details. A surviving spouse is entitled to the deduction if they are at least 60 years old. The amount of the deduction is the lesser of one-half of the assessed value of the real property or $12,480. Call 317-232-3777 for details. Also click here.
A circuit breaker program is aimed at helping residents by ensuring they don’t pay more than 2% of their property value in taxes. The goal is to provide predictability in tax bills and equity among Hoosier taxpayers.
For more information on property tax deductions, click here .
Inheritance and Estate Taxes

The inheritance tax (Class A) ranges from 1% to 10% based on fair market value of property transferred at death. The estate tax is the amount by which federal credit exceeds inheritance taxes paid to all states. Click for details.
For further information, visit the Indiana Department of Revenue site.
*Includes local county taxes
Reply With Quote Quick reply to this message
 
Old 05-24-2014, 06:28 AM
 
Location: Ponte Vedra Beach FL
14,628 posts, read 17,917,951 times
Reputation: 6716
Quote:
Originally Posted by newenglandgirl View Post
This is why those silly retirement advice articles ("Low COL states," etc.) fail to make sense. They assume a common set of circumstances, so common that their "advice" proves meaningless.

As for sales tax, for large ticket items (or even food and clothing, for that matter), if one is close to another state that has none, it's a simple drive over the border once or twice a month (unless of course you reside in the middle of say North Dakota).
WRT buying big ticket items out of state - and not paying your state's sales tax - most people who do this are breaking the law. Since most states have a "use tax" that you owe if you buy something out of state to use in state. Doubt most states will chase you when it comes to your fall wardrobe. But you'll definitely have issues if you're talking about something like a car. Or a boat (here in Florida - the tax people go around visiting marinas to make sure that Florida residents have paid Florida sales tax on their boats). Robyn
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Retirement
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

© 2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top