Oddly specific question regarding taxes (Vancouver: low income, sales, school)

[badkarma318]

Hello everyone,



My longtime sweetie will be retiring from a federal job soon (VA hospital in California), and one of the places we will be visiting as a potential retirement spot is the Vancouver area. I understand there is no state income tax, but does federal still apply? I'm trying to find out which taxes would be taken out of her pension checks if we move there - none, just federal, or state and federal.


Thank you.

[texasdiver]

There is no place on the planet where Federal income tax does not apply.

You can retire in Equatorial Guinea and will still owe Federal income taxes.

[StealthRabbit]

Many USA residents with on-line business income locate to a US Protectorate for income tax relief / benefit. A few friends from WA did that due to WA business taxation headaches abd burden.

Often there will be a territory income tax, but is lower and excluded from US Federal income tax.

https://www.irs.gov/individuals/inte...us-possessions

If you have income from one of these U.S. territories, you may have to file a U.S. tax return only, a territory tax return only, or both returns. This generally depends on whether you are considered a bona fide resident of one of the U.S. territories. In some cases, you may have to file a U.S. return, but be able to exclude income earned in a territory from U.S. tax. Filing requirements for specific U.S. territories are explained in Publication 570, Tax Guide for Individuals With Income From U.S. Possessions.

It is usually a good idea to get away from wage income and into Business / corporate income ASAP. (about age 12)

WA state is income tax free, but Federal taxes apply to those meeting the requirements to file. (Which excludes a lot of retirees / cash economy / barter / communal living..,.)

Many retirees have to file, but owe nothing. (There are ways to assure that )

Some WA residents think it is swell to shop in Oregon (no sales tax), here is how you can pay the REQUIRED WA Use Tax for items purchased in a state with no sales tax, but used in WA.
As a business I file this with WA DOR monthly.
https://dor.wa.gov/contact-us/local-offices/vancouver
https://dor.wa.gov/taxes-rates/use-tax

Good training programs through WADOR + auditors to assure you have met the learning expectations.

Another 'low income tax' resource... (I would prefer American Samoa or North Mariana's)

https://octavianreport.com/article/t...nd-high-temps/
The jewel in the crown of this program is a 90 percent reduction in the individual income tax rate

Significantly lowering your tax rate means, in many cases, unattractive tradeoffs like moving somewhere much less desirable. But there is a solution that nicely splits the difference between these options, allowing you to enjoy all the benefits of U.S. residence at a significant tax advantage — assuming that you derive most of your income from the ownership of a business and are willing to relocate to the U.S. Virgin Islands.

[texasdiver]

Yes, but the OP is talking about Federal pension income, which is taxable. No state can waive Federal tax obligations, so the Federal income tax owed will be the same in every state, all other things being equal (which they never are). For example, state and local property taxes in WA may be higher than in a different state which will provide more tax deductions in WA.

In any even, the Federal tax burden for a Federal pensioner is not likely to be all that high unless there is a lot of other income coming in from someplace else.

[TheOrca]

Yup there are plenty of people, most of the time very wealthy, that don't pay any federal income taxes

Poor people are most targeted for taxation in today's society

[zerp]

Originally Posted by TheOrca

Yup there are plenty of people, most of the time very wealthy, that don't pay any federal income taxes

Poor people are most targeted for taxation in today's society

“ The share of reported income earned by the top 1 percent of taxpayers rose to 21 percent, from 19.7 percent in 2016. Their share of federal individual income taxes rose to 38.5 percent, from to 37.3 percent in 2016.

In 2017, the top 50 percent of all taxpayers paid 97 percent of all individual income taxes, while the bottom 50 percent paid the remaining 3 percent.

The top 1 percent paid a greater share of individual income taxes (38.5 percent) than the bottom 90 percent combined (29.9 percent).

The top 1 percent of taxpayers paid a 26.8 percent average individual income tax rate, which is more than six times higher than taxpayers in the bottom 50 percent (4.0 percent).”

https://taxfoundation.org/summary-of...a-2020-update/

[TheOrca]

This is left wing propaganda created by the elites so that they don't pay taxes - you probably spend a lot of time around working class people and most people do so they never understand taxes

There are 2 tax systems in America, the worker tax and the investor tax

The investor tax rate is 0-20% on liquidated gains. If you never cash out the rate is 0%

The worker tax rate in America yes is very high no doubt about that - one of the highest in the worlds.

So yes while the worker tax on middle class people is one of the highest in the worlds, the investor tax is very low

Look into what they call "income tax" - that's what all of the working class people think of when they think of taxes. Then look into something called "capital gains".

They won't teach you this in school or on the news

[TheOrca]

Originally Posted by zerp

“ The share of reported income earned by the top 1 percent of taxpayers rose to 21 percent, from 19.7 percent in 2016. Their share of federal individual income taxes rose to 38.5 percent, from to 37.3 percent in 2016.

In 2017, the top 50 percent of all taxpayers paid 97 percent of all individual income taxes, while the bottom 50 percent paid the remaining 3 percent.

The top 1 percent paid a greater share of individual income taxes (38.5 percent) than the bottom 90 percent combined (29.9 percent).

The top 1 percent of taxpayers paid a 26.8 percent average individual income tax rate, which is more than six times higher than taxpayers in the bottom 50 percent (4.0 percent).”

https://taxfoundation.org/summary-of...a-2020-update/

This is left wing propaganda created by the elites so that they don't pay taxes - you probably spend a lot of time around working class people and most people do so they never understand taxes - just talk about raising the worker tax all the time

Basically There are 2 tax systems in America, the worker tax and the investor tax

The investor tax rate is 0-20% on liquidated gains. If you never cash out the rate is 0%

The worker tax rate in America yes is very high no doubt about that - one of the highest in the worlds.

So yes while the worker tax on middle class people is one of the highest in the worlds, the investor tax is very low

Look into what they call "income tax" - that's what all of the working class people think of when they think of taxes. Then look into something called "capital gains".

They won't teach you this in school or on the news

Worker tax never applies to the elites because they don't have jobs they just invest old money