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Having not quite yet retired I did not realize until last night that Oregon does not tax Social Security. Maybe another good reason to max it out.
There is an initiative on the ballot for 2024 to Freeze Property Taxes on people 65 and older.
I live just minutes from Washington State that does not tax income, but, does have a sales tax. Washington tends to have a higher cost of living than Oregon. It may not be worth making that move; but, if you are downsizing it may be worth considering. Maybe when RMD's kick in (for me at 75) when I am also ready to downsize.
I live it the wonderful state of Massachusetts. It doesn't tax SS and qualified pensions like FERS CSRS Military and State pensions. We do have a sales tax on stuff with exceptions on clothing and food stuffs. Some people think our property taxes are too high but they are half of what the state just north of us NH that has no income tax at all and no sales tax. But that leads me to believe that property owners pay the bulk of everyone's travel on the streets and such. They do require me to pay taxes on my withdrawals from my 401k.
I have lived in Washington state years ago and found it a wonderful place with awesome people but that time was a very long time ago so economics I cannot give you more than you already know. Oh and I am paying $7k in taxes a year for a property Zillow has estimates of $650k property value.
Yes, I realize I can research it myself. I wanted to hear first-hand accounts from actual people regarding their local tax situations. Reading about it never tells the whole story. People may have relocated in consideration, at least in part, of the tax consequences.
No chance for TN to have an income tax of any kind. TN did away with the Hall tax on dividends/interest/capital gains.
For groceries now have 3 month "sales tax holiday". Over time that holiday could be extended to 12 months. You do need to watch which items are groceries or other items not. Part of the sales tax problem is each city/county adds to the state tax rate.
Back to the OP, there are 13 states that tax Social Security benefit. Movement is on to reduce the number.
What may be more important is on the FIT. There is a threshold where you start to include SS income in your tax calculation. About 60% pay this tax. Nothing has happened to change this since 1980's.
I'm well aware that there will not be an income tax in Tennessee. Those in power would rather put a burden on those who can afford it the least so they can continue to trumpet "no income tax in Tennessee!"
I don't think that the food tax holiday will be extended past the three months as it costs the individual counties a lot of income.
I'm well aware that there will not be an income tax in Tennessee. Those in power would rather put a burden on those who can afford it the least so they can continue to trumpet "no income tax in Tennessee!"
I don't think that the food tax holiday will be extended past the three months as it costs the individual counties a lot of income.
I can see how this is a double edged sword. Taxing food hurts those that can least afford it.
On the other hand, much of Tennessee's huge growth is because of a lack of income tax. Many people along with job creating industries have moved there because of that reason. It seems many people especially retirees won't consider moving to a state with income taxes anymore, no matter how small they are. Florida is somehow able to do it without taxing grocery store foods but I know little about all of this.
I don't live in Reno but visited once on business trip. The locals told me about the following.
Reno has no lack of water. It enjoys rain from the water moisture from Sierra Nevada mountain nearby to the west, but the rain overshoot Reno and falls to the east and collects at the Pyramid Lake. The Truckee river flows the water through Reno.
Interesting fact I found out when visiting Pyramid Lake is that Nevada used to be one great lake millions of years ago. Look up Lake Lahontan
You can easily Google this; there are lists of taxes applied in every state. It's a useful retirement tool. Mine isn't a particularly retiree-friendly state, which is yet another reason to move. However, it seems where taxes are low, other things are high, so they get you one way or another!
I know. People here are pointing out some of the nuances of their tax laws (which are not all apparent in various articles on the subject). Plus things are changing with taxes all the time (especially recently).
No state income tax
No estate or inheritance taxes
Homestead exemption for the first 50K.
But beware of other taxes and insurance. In 9 years our insurance went from $1200 to $8000. Our neighbor who sits a little lower on a stream pays $12000. If you live on or near the water, even more! Counties here vary in how they charge property tax, but it can make for an awkward conversion with new neighbors who find out they are paying almost 3 times what their neighbors are paying. A house down the street recently sold for $985K, the only sale on our street since 2014, when most of the homes were built, and those sold at ~$550 on average. They are paying way more than us original owners but even we have seen it go up every year by about $100.
Other things that people forget about when moving to Florida is that yard work and its costs are year-round, and as growing grass here is hard, many end up going with professional lawn care, everyone needs sprinklers etc. We use reclaimed water in my neighborhood, but for many, it is paid for by the homeowners. My mother's water bill was on average $150 a month, while mine is $85 but that includes trash and recycling pickup and 3 people. Hers was just water for a single person..with a yard. More bugs mean more aggressive pest control, an additional cost. Mold and mildew grow on everything here so powerwashing etc is an additional expense people who move from other places don't consider.
So the income tax thing is just a tiny part to consider.
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Maybe another good reason to max it out.
