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IMO, for a low income person who owns a home, VT is a better deal than NH or MA tax wise because of the property tax abatement.
It depends on the town. My Massachusetts mill rate is $8.78. That’s lower than the muni rate in most Vermont towns even if you’re at poverty level and don’t pay any of the Act 68 school tax. I’ll be collecting Social Security shortly. That isn’t taxed in Massachusetts. Unless you’re cardboard box and dog chow low income in Vermont, it’s taxed.
I was a vacation home owner for 26 years. After Act 60, I was taxed at the commercial rate. With required 100% assessment as the law of the land, I saw the writing on the wall and flipped my Vermont place for one in Colorado. I no longer needed to be within a few hours drive. My Colorado property taxes are 1/5th of the 2023 taxes on my previous Vermont place. I’m kind of sad to give up all the friends I met over 35 years but my retirement math didn’t work. I’m totally good with Act 60. It’s a small state and doesn’t have a lot of wealthy people. 17% of the housing stock is vacation homes. It makes complete sense to tax the out of staters heavily. I unfortunately got to the point where I wasn’t willing to pay Vermont property taxes, the high energy costs, or deal with the enormous labor shortage. In Colorado, if you need work done, people actually show up and are conscientious. My experience in Vermont was very hit or miss. The electrician was great. The locksmith/glass business was great. Other things were really unsatisfactory.
I never considered declaring Vermont as my residence. The tax math didn’t make sense when I owned property in a couple other states. Again, I’m fine with Vermont’s public policy. I just chose to not participate. I kept my place as a vacation home and never internalized “I live here”.
To me, Vermont’s bigger problem is the housing shortage. Building rental housing should be encouraged and shouldn’t pay the commercial tax rate if renting to Vermonters. Anything possible should be done to reduce costs for building a starter home. That includes revamping the anti-subdivision tax law. If someone wants to carve up some acres into small lot starter homes, encourage it. Don’t tax them to death if they don’t let the land sit fallow for 5 years.
So, if a home worth $250,000 is currently paying a tax of $3,000/yr and $600 gets tacked on. that is about 1.4% of the value. Add $1,200 required homeowner insurance and that is close to $5,000 plus the mortgage.
Vermont income tax rate is what? Around 8%? Federal on someone making around $80,000 is 22%. ,All totaled after all deductions, about $60,000 would be take home on that $80,000.
Subtract the $5,000 for tax and insurance and you are down to $55,000 spendable. With 7% sales tax on most things after this, you are down to $51,000 spendable.
Figure $4 gallon gas prices and a $25,000 car bought a couple years ago with 20 mpg average, driven 13,000 miles per year. $1,600 gas cost. Auto insurance per year $2000. Summer and winter tires $1000. $400 misc auto and it is about $5000, you are down to $46,000. $500/mo food = 6,000/yr. Now you are down to $40,000.
Health insurance silver plan for just one person is $11,000/yr, you are down to $29,000 or $18,000 if a couple. Now that mortgage? Let's say it is on $200,000. The monthly payment is about $1,300 or $15,600/yr. You are now at either $13,400 or $2,400 if a couple. Oh yeah, that car loan on a $20,000 car is about $4500 per year. The single has about $8,900 left, the couple has gone in the hole or left the state.
$8,900 left. $500 for clothes isn't unreasonable for a thrifty shopper. Dental, glasses, OTC health products, what, $1,000 per year? Christmas gifts and such? $500. Phone $50/mo = $600. Heating costs to get through the winter $2,000. $4,300. Electric $200/mo, water $50/mo = $3,000. $1,300 left. Cable TV and internet access could eat that in a second.
And then comes a flood...
Just in case you were wondering, a GROSS pay of $15/hr, 40 hour work week, 50 weeks per year is $30,000. TWO people working at that rate fall $20,000 short of the $80,000 per year figure I used.
All of the above figures are off-the-cuff and to show a VERY rough accounting. There are errors, (do your own and correct the errors, don't bother nit-picking) but the thrust is there regardless. What is generally considered a "normal" lifestyle is difficult to impossible in Vermont. Even back when I lived there it was common to see people who had inherited their home driving around in old cars, with minimal insurance.
OMG, water is $50.00 a month now!!?? I used to pay $7.50 when I lived on Long Island twenty years ago.
I do see that every company I deal with is raising rates...even my auto insurance company is getting greedy. I did switch homeowners insurance and saved $1000.
I think we may have lurched into the unaffordable if this passes. Remember, too, there is a veto proof majority.
sigh
EDIT: We may be passing the point of diminishing returns. ha!
I will not be able to afford to live here if that rate hike is passed. Even a 10% hike would force me to put my house up for sale. I really have had enough of the BS these government officials are throwing at us. The only people that are going to be able to afford to live here are working in the education system.
I was looking at the stats for Vermont on CD. It states that over 1000 Vermonters moved out of Vermont and over 15,000 foreigners moved in. If they raise our property tax to 20%, it will be unaffordable because taxes and salaries are not balanced. Where I grew up, taxes were high but so were salaries. People weren't forced to work second and third jobs to make ends meet. This state is exhausting.
I will not be able to afford to live here if that rate hike is passed. Even a 10% hike would force me to put my house up for sale. I really have had enough of the BS these government officials are throwing at us. The only people that are going to be able to afford to live here are working in the education system.
I was looking at the stats for Vermont on CD. It states that over 1000 Vermonters moved out of Vermont and over 15,000 foreigners moved in. If they raise our property tax to 20%, it will be unaffordable because taxes and salaries are not balanced. Where I grew up, taxes were high but so were salaries. People weren't forced to work second and third jobs to make ends meet. This state is exhausting.
I feel the same way NYLIER. It IS exhausting to live here. This crap never ends. I've been able to put it aside for reasons previously stated and because the pros and cons of moving deterred me from leaving.
I mean, I COULD continue to pay exhorbitant taxes, if this increase goes through, but this will cut into my disposable income. We are retired and not wealthy although we may actually be doing better than the average working VTer. Maybe. (we own our home). But at some point I feel like I have to say enough is enough. I'm not keen on curtailing my relatively modest lifestyle so I can stay here - despite my comments about how much I enjoy the rural lifestyle. And I'm sure not going to deplete my 401K which will be taxed to pay taxes? Forget that !!!!
The Guv was on the news tonight saying VTers can't afford a 20% increase and 'they' are going to work with the legislature to get a handle on the proposed tax increase.
The education funding system is ridiculously ill-conceived, and I had to laugh our local town has a 'giving tree' for all the stuff the school wants. I guess my taxes are not enough. And I pay plenty.
I also don't want to get a job. I am retired. I've worked my whole life to get to this point and I don't live extravagantly, but I don't think I can live in a place that cares nothing for me other than what income of mine they can tax. Every.Single.Penny. And then they'll tax my Soc Security which I have not yet started to collect. I'm worried. And my husband is not on board with contemplating a move. He thinks that there are no places left to go that are much better than here and I've come to the point where I have to strongly disagree. He just doesn't want to look. This issue is causing problems in our relationship.
NYLier, you are correct as well about salaries not even being balanced with costs here. Good paying jobs are few and far between, and its the main reason the younger generation doesn't stay here. It's an untenable situation that the governing body seems not to understand.
The decision will be where to go where we can enjoy a quiet, rural lifestyle and to get busy, once again, to try to find that next place.
I feel the same way NYLIER. It IS exhausting to live here. This crap never ends. I've been able to put it aside for reasons previously stated and because the pros and cons of moving deterred me from leaving.
I mean, I COULD continue to pay exhorbitant taxes, if this increase goes through, but this will cut into my disposable income. We are retired and not wealthy although we may actually be doing better than the average working VTer. Maybe. (we own our home). But at some point I feel like I have to say enough is enough. I'm not keen on curtailing my relatively modest lifestyle so I can stay here - despite my comments about how much I enjoy the rural lifestyle. And I'm sure not going to deplete my 401K which will be taxed to pay taxes? Forget that !!!!
The Guv was on the news tonight saying VTers can't afford a 20% increase and 'they' are going to work with the legislature to get a handle on the proposed tax increase.
The education funding system is ridiculously ill-conceived, and I had to laugh our local town has a 'giving tree' for all the stuff the school wants. I guess my taxes are not enough. And I pay plenty.
I also don't want to get a job. I am retired. I've worked my whole life to get to this point and I don't live extravagantly, but I don't think I can live in a place that cares nothing for me other than what income of mine they can tax. Every.Single.Penny. And then they'll tax my Soc Security which I have not yet started to collect. I'm worried. And my husband is not on board with contemplating a move. He thinks that there are no places left to go that are much better than here and I've come to the point where I have to strongly disagree. He just doesn't want to look. This issue is causing problems in our relationship.
NYLier, you are correct as well about salaries not even being balanced with costs here. Good paying jobs are few and far between, and its the main reason the younger generation doesn't stay here. It's an untenable situation that the governing body seems not to understand.
The decision will be where to go where we can enjoy a quiet, rural lifestyle and to get busy, once again, to try to find that next place.
You can rant all you want. People that are considering moving to Vermont need to know what this Progressive Gov't is doing to the people, not only financially but emotionally. It is not easy to just pick up and move to another state, especially if you love your home. The extra expense just isn't worth living here, for me anyway.
People get hired at my job and within a week they are gone because they get more staying home collecting welfare. One young guy that moved here from out west got fired because he has a heavy drinking problem. Now he sits in the cafe all day and is getting gov't assistance and Medicaid. I collect Social Security, have a small pension and work a part time job and still don't make what they are getting free and clear from the taxpayers. It scares me to see how expensive everything is now and how these big companies are raising their rates multiple times a year now. Our government knows how hard it is for the people and they plan on slamming a 20% property tax hike on us?! For a dysfunctional education system that will go right in the pockets of the employees?! We are the 3rd or 4th highest state for per pupil spending but they won't be happy until we are the highest and bankrupt half the people in this state.
It isn't just the property taxes either, pretty soon the carbon tax on heating fuels will kick in too. I don't know anyone who isn't talking about looking into leaving the state now.
The cruddy gloomy weather alone is enough to make me want to flee many days.
Nice weather days are few and far between.
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