TN vs NC for Tax Advantage (car insurance, home, income)

[hiknapster]

It is 5.5 percent. Your local municipality adds on their tax. I don't think they can go beyond 2.75 percent, by state law.

Grocery tax reduction among new Tennessee laws

It's all in here:

http://www.tennessee.gov/revenue/tax...alesanduse.pdf

The local sales tax:

http://www.tennessee.gov/revenue/pubs/taxlist.pdf

I just wrote in the Knoxville forum, about a week ago, that I should throw this up on the main TN page:

Sales and Use Tax (http://www.tennessee.gov/revenue/tntaxes/salesanduse.htm - broken link)

Originally Posted by Big TR

If the grim reaper is around the corner waiting for you, Tennessee has a pretty onerous death tax. I'm not sure how it compares to NC, but I know some wealthy people leave Tennessee to avoid it before they eat the dirt sandwich.

Excuse me? I'm guessing you mean estate taxes, in which case we are ranked 45th in the country. I have never heard of anyone moving out of the state to die.

The Tax Foundation - Federal Estate Tax Collections, by State and Per Capita, 2007

[Big TR]

For the wealthy, the estate tax in Tennessee is not good.

For your average Joe, estate taxes don't matter because you don't have millions sitting around that you're trying to pass on to heirs.

[yarddawg]

Y'know, I always get a kick out of the generalizations in the tax threads. Because when you start applying this stuff to specific people the state rankings mostly fall apart into semi-meaningless. Which state taxes bite you the most depends so much on your lifestyle, how you live, how you spend your money and whether or not you end up paying out of pocket for things that were government funded in your previous location.

But, all that being said, I think this has to be one of the worst times in history to make a permanent move based on low taxes. For a very simple reason. This state is broke. Really broke, even with all the cost cutting and fed money we're over $70 million in the hole after the first quarter. So are a lot of the others. And the fed isn't looking good either. Taxes are going up in the next few years people. I don't know which ones or how much. Neither does anyone else. As in all things political there'll be a lot of random in it. So if your make-or-break for relocation to any area is low taxes...... you might want to either keep looking or hang onto the idea that it might be temporary.

[hiknapster]

Well, you will have to be very wealthy. There is only tax IF there is more than $1M. Otherwise, no tax. And it is incremental after that. Inheritance Tax (http://tennessee.gov/revenue/tntaxes/inherit.htm - broken link)

First of all, as far as broke states go, we look great. Sad to say, but true.

Taxes are a consideration, but it shouldn't be at the top of the list, unless you are a retiree. Then it is often very important.

There are so many better reasons to move to this state, though, in a recession or not.

[Jimrob1]

Thanks everyone for all the info and views. Hiknapster you are correct. Taxes are a huge consideration for retirees. Many of us by law are only allowed to earn so much money beyond our pension or SS until we reach a certain age. It seems that age requirement keeps getting closer to 70 every few years now. As much as I think I would like many areas of Tenn, I think for me personally this type of and amount of sales tax would be to much. I have been told its not just on items one buys it is also on services. One person told me he thinks it is on the rent one pays for an apt. I found that hard to believe but then I don't live there to really know.

Thanks Again.

[hiknapster]

Originally Posted by Jimrob1

Thanks everyone for all the info and views. Hiknapster you are correct. Taxes are a huge consideration for retirees. Many of us by law are only allowed to earn so much money beyond our pension or SS until we reach a certain age. It seems that age requirement keeps getting closer to 70 every few years now. As much as I think I would like many areas of Tenn, I think for me personally this type of and amount of sales tax would be to much.

I have been told its not just on items one buys it is also on services.

WRONG.

My husband is a business owner.


One person told me he thinks it is on the rent one pays for an apt.

WRONG.

I rented for three years before I bought my house.

I found that hard to believe but then I don't live there to really know.

Thanks Again.

For the life of me I can't understand why you do NOT want to move to TN in your retirement. Was I not clear?

ONLY FIVE OTHER STATES HAVE LESS OF A TAX BURDEN.

TENNESSEE DOES NOT TAX YOUR PENSION OR SOCIAL SECURITY.

I hope that was clear.

Oh, and one more thing. Tennessee is dirt cheap. The cost of living is incredibly cheap compared to Oregon. Or Massachusetts, for that matter.

[Tony1790]

Originally Posted by yarddawg

I think this has to be one of the worst times in history to make a permanent move based on low taxes. For a very simple reason. This state is broke. Really broke, even with all the cost cutting and fed money we're over $70 million in the hole after the first quarter. So are a lot of the others. And the fed isn't looking good either. Taxes are going up in the next few years people. I don't know which ones or how much. Neither does anyone else. As in all things political there'll be a lot of random in it. So if your make-or-break for relocation to any area is low taxes...... you might want to either keep looking or hang onto the idea that it might be temporary.

Of course you are correct about state/local taxes needing to go up, but please consider this, when you say this state is broke, yes, but that's with a small "b". States like Calf are broke with a capital "B" and actually are likely insolvent if truth be told. So taking taxes into account is still important as all states/locals should be raising taxes across the country and you need to be where they are the lowest and unlikely to rise all that much, i.e. TN.

And to those other people that are harping about sales taxes, yes they are high and yes they tax the poor disproportionately, but they aren't much higher than in NC, plus NC has all of the other taxes to go with them, and this thread was originally about NC vs TN in taxes, TN wins hands down. I figured it out to the dollar and I could make $5 less per hour in TN than in NC and have the same amount of cash left over at the end of the day.

Good luck to all, I made my TN move based on taxes, cost of living (home buyer not renter as renting isn't much cheaper here) and quality of life...TN wins hands down.

Good luck all, but I'd seriously reconsider moving anywhere if where you are you have a decent paying job and can't transfer or have a similar job lined up before you move. You can't pay taxes if you are unemployed, right?

Tony

[Big TR]

Originally Posted by hiknapster

For the life of me I can't understand why you do NOT want to move to TN in your retirement. Was I not clear?

ONLY FIVE OTHER STATES HAVE LESS OF A TAX BURDEN.

TENNESSEE DOES NOT TAX YOUR PENSION OR SOCIAL SECURITY.

I hope that was clear.

Oh, and one more thing. Tennessee is dirt cheap. The cost of living is incredibly cheap compared to Oregon. Or Massachusetts, for that matter.

This completely depends on your source of income in retirement. If this person earns only SS and pension income, then it is probably a good decision. If they are living off dividends of stock or bond interest, it's a terrible decision to move to Tennessee from a tax standpoint.

[hiknapster]

Originally Posted by Big TR

This completely depends on your source of income in retirement. If this person earns only SS and pension income, then it is probably a good decision. If they are living off dividends of stock or bond interest, it's a terrible decision to move to Tennessee from a tax standpoint.

Give me a break. First it was the death tax. That was just terrible. You'd have to move to another state to die, you wrote!

I proved that wrong. We are ranked 45th in estate taxes.

So now you're saying that the dividends and capital gains tax is a reason to avoid Tennessee?

We are ranked 32nd! On top of that, there is a break for persons over 65. The Tax Foundation - Dividends and Capital Gains Income Compared to Other Income by State, 2005

I really, really get angry when people move to Tennessee JUST because you can get such a fabulous bang for your buck. This state is really attracting retirees. I lived in Florida for 10 years and I would really like to avoid the hordes of retirees and transplants, too. But let's get the facts straight:

There are huge tax and monetary advantages to retiring to Tennessee.

[Big TR]

If you would like 6% of your non-pension dividend, CD and Bond interest and capital gains to be taxed every time you get a check in the mail, feel free to move the Tennessee for your retirement. After all, we're ranked 45th!!! We're ranked 32nd!!!!! What could go wrong??

As a blanket rule, if you are living off pension and SS and don't have a ton of assets to pass on to relatives, TN would be a great state to retire to. If any of these are not the case, you have to evaluate the varying taxes that either you or your estate will be assessed.

I am participating in this thread to give specific examples of taxes a retired person has to concern themselves with if they are thinking of relocating to Tennessee. I specifically mentioned wealthy individuals when referencing the estate tax. Spouting grand studies of overall taxation is ridiculous, Hik. Yarddawg is right on with his previous post.

Edited to add: Hik, did you even read the "We're 32nd!!!!!" and "We're 45th!!!" links you posted. The report is saying that TN is 32 out of 50 in in average income related to "Capital Gains and Dividend Income" and 45th in collected estate taxes. This basically proves that Tn is a crappy place to retire as nobody is paying these taxes. These reports are not saying what you think they are saying.