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Why do people spend money for water to grow grass where it naturally doesn't grow in order to then spend money to mow it year-round? That seems to me the height of insanity. In other words, some of these "hidden costs" can be mitigated with a little common sense.
Ma. says that SS in not included in your gross state income but is included in federal income depending on threshold. But Ma makes sure they tax every other bit of retirement income. And that doesnt include all the other taxes the state of Ma uses to get their pound of flesh.
No state income tax
No estate or inheritance taxes
Homestead exemption for the first 50K.
Homestead reduction is two $25,000 amounts applied to different taxes.
"When someone owns property and makes it his or her permanent residence or the permanent residence of his or her dependent, the property owner may be eligible to receive a homestead exemption up to $50,000. The first $25,000 applies to all property taxes, including school district taxes. The additional exemption up to $25,000 applies to the assessed value between $50,000 and $75,000 and only to non-school taxes. (see section 196.031, Florida Statutes)"
The longer term savings arise from the Save Our Homes cap.
"After the first year a home receives a homestead exemption and the property appraiser assesses it at just value, the assessment for each following year cannot increase more than 3 percent or the percent change in the Consumer Price Index (CPI), whichever is less. This is called the “Save Our Homes” (SOH) assessment limitation. The accumulated difference between the assessed value and the just (market) value is the SOH benefit."
Why do people spend money for water to grow grass where it naturally doesn't grow in order to then spend money to mow it year-round? That seems to me the height of insanity. In other words, some of these "hidden costs" can be mitigated with a little common sense.
depends on your neighbors and your town by laws. dont mow your grass and you might have a hefty fine by the town.
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.
Yes, in Florida property value reevaluations are limited on homes once you purchase but once they sell they are reevaluated. Lots of states do it this way so that long time older owners don't lose their property when values increase considerably. Another break is 100% disabled Veterans (from what I understand you can get 100% disabled if you had boots on the ground, no matter for how long, in Vietnam because of Agent Orange. This means you pay only the fees for police, library, trash etc. They also vary county to county. Insurance here has also gone up ridiculously due to hurricanes last year. I will say that in the past few years my taxes have gone down due to increase in building and thus more paying in and their not approving budget increases. Hope this trend continues.
depends on your neighbors and your town by laws. dont mow your grass and you might have a hefty fine by the town.
In many cities and counties of the SW, people are given money to remove their lawns and replace them with drought tolerant more natural landscapes, but some people are pretty stubborn about their lawns. Personally I couldn't care less what my neighbors do. I owned homes in SoCal for over 30 years in a few cities and never had a lawn.
I'm not aware of any towns that now require you to have lawns where rainfall can't naturally support them but they may be out there still.
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.
Massachusetts. I don't believe it taxes Soc Security. But I don't plan on taking soc security for 6.5 more years (ie, not until I'm 70), and who knows what can happen by then. Even if MA should be taxing soc security, the state tax is flat at 5%, which would not be that much on my soc security income, and would be more than compensated by the massive property tax exemption for my primary home in Boston. Even if MA taxed soc security (which I don't think it does; I guess I should check), other advantages of living in Boston would still greatly outweigh that taxation.
Ma. says that SS in not included in your gross state income but is included in federal income depending on threshold. But Ma makes sure they tax every other bit of retirement income. And that doesnt include all the other taxes the state of Ma uses to get their pound of flesh.
I had owed taxes to various states before retirement (because I worked on medical contracts nationwide), but I don't think MA is all that bloodthirsty compared with some others, particularly for people with upper-middle income who are skinned alive in some other places (CA! NYC! ). MA has a flat state income tax of 5% (now with extra I think 1% on income above $1M), not rapidly progressive beyomd that, and I don't know abput other counties but Suffolk County (central Boston) has huge property tax exemption for the primary home, probably the biggest in the nation. Boston is also a safe walkable city with good medical institutions which is priceless in retirement, and has two big positives for me personally (fast easy access to an excellent airport, and two fantastic public library systems on Boston and Cambridge).
we pay so little in state and local taxes that i have to carry over the tax credit we get for our long term care policy .
we have both a new york state income tax and a new york city one .
a lot of our income is not taxed locally .
treasury interest , my wife’s pension , our ss , the first 20k in qualified retirement money .
Yes, I think people are surprised by the reality vs their preconceptions of living in NYC.
NYS doesn't tax SS nor the first $20K withdrawn from an IRA. Over time I have used this to do Roth IRA conversions with little tax consequence so that now 2/3 of my retirement savings is in the Roth IRA.
So $40K from SS + $20K from IRA + $20K from Roth = $80K income annually with no taxes due at all. NYC RE taxes are suprisingly much less than our surrounding suburbs as well.
If one is able to find a nice place to live with reasonable costs it isn't bad at all for an urban lifestyle, but that is the key element that takes some searching & luck. My non discretionary costs, excluding groceries, barely reaches $1K/month for a very comfortable lifestyle for me on that potential tax free $80K that I can hardly figure out how to spend (still haven't figured out how to spend that much!)
I really investigated almost all of the LCOL places mentioned all the time on here & every single one of them would cost me more per month to live in with a great reduction in choices of the (urban) activities I enjoy. (I understand many people don't want to live in a city, I would wither in the 'burbs based on past experience.)
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Maybe another good reason to max it out.
NYC! 
