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"Some states offer attractive tax benefits for retirees. Then there are these ten tax hells, which have earned a place on our "do not live here for your second act" list either because of higher-than-average taxes across the board or because of policies that don't exempt much retirement income from state taxation."
We live in one of those states and we are leaving ASAP when Mrs. Tek retires. It's not only the taxes, though. The entire personality of the state has changed to the point that I'm embarrassed to admit I live here sometimes. And, no, it's not Wisconsin, the Nazi Germany of the Great Midwest.
Thanks for the link Laura, I'm going to bookmark it.
Interesting. Who would have thought Iowa and Nebraska would have made the list? And I'm surprised New York State did not make it. Our impressions are not always totally accurate. For example, everyone knows that California is a high tax state, so its inclusion is no surprise, but when you look at the details it is not really worse than the other nine, at least not to a substantial degree. Yet people talk as if California were a unique horror in the USA, and it's just not so.
I take issue with the aritcle's statement, "Do not live here for your second act". There are many other factors besides taxation in choosing where to live in retirement, cost of living being a major one. Despite their tax status, I'll bet Iowa and Nebraska have a fairly low cost of living, and I'll bet further that the low cost of living would save a person more than the high taxes would cost. Who would want to live in Iowa or Nebraska? That's yet another issue.
Some everyday items tend to remain off our radar, such as utilities. In California, if you don't live in the desert (very high summer heat) or the mountains (very cold winter weather), you don't have to run the heat or the air conditioning very often. This could save more than what Californians pay in state income taxes, depending on one's income of course.
While the article is interesting and useful, I think it reflects an over-emphasis on taxation issues to the exclusion of so much else. At least that is my take on it with my middle-class income. People with high incomes also have a higher stake in all this.
I am surprised Nevada is not on the tax friendly list. We don't have an income tax at all and sales taxes are about 8% with food and medical exempt. The funny thing I noticed about "low cost" and "low tax" states is that they are generally states nobody really wants to live in. You want to retire and live in freezing cold weather? Or in the southeast? No thanks. I would live here, CA or FL only.
I am surprised Nevada is not on the tax friendly list. We don't have an income tax at all and sales taxes are about 8% with food and medical exempt. The funny thing I noticed about "low cost" and "low tax" states is that they are generally states nobody really wants to live in. You want to retire and live in freezing cold weather? Or in the southeast? No thanks. I would live here, CA or FL only.
You seem to be contradicting yourself. Florida is in the southeast, about as far southeast as you can get. What is it that makes Florida more desireable as a retirement destination than the rest of the southeast? That whole region shares the unbearable heat and humidity of the long, long summers.
Interesting. Who would have thought Iowa and Nebraska would have made the list? And I'm surprised New York State did not make it. Our impressions are not always totally accurate.
NYS has quite a few exemptions for retirees. Pensions are treated differently than income and there is a $20K exemption, military retirement is not taxed with property tax exemptions for serving in a combat zone and disability, seniors receive a reduction on school/property taxes, and there is a STAR Energy credit reduction on school/property taxes.
I am surprised Nevada is not on the tax friendly list. We don't have an income tax at all and sales taxes are about 8% with food and medical exempt. The funny thing I noticed about "low cost" and "low tax" states is that they are generally states nobody really wants to live in. You want to retire and live in freezing cold weather? Or in the southeast? No thanks. I would live here, CA or FL only.
Everyone to their own liking. We love living in NYS, snow and all and great people. We spend 6-8 weeks in the FL Keys in the winter, but would NEVER live there or Nevada. Heat and humidity! Ugh!
My pension is 'taxable' here. But it is not high enough to reach into any tax bracket, so it is not taxed.
We did file for the $10k 'homestead' exemption on our home which lowered the assessment value on our house. Our property taxes on a 2400sq ft house with 42 acres of land is under $900/year.
In my personal experience the data used to go into this article is completely bogus.
I am not 'from' here. I moved here after I retired, in part because of how low the taxes and cost-of-living are here. Now I see many others that have been likewise migrating here for their retirements.
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