Hawaii income tax tables 202012/14/2023 Or you may simply like the view out your back window. Or you may wish to live close to your children or grandchildren. For example, you may need medical care in an area that has higher taxes. You may have other reasons to move that don’t hinge on your tax bill. “The different tax burden is definitely going to make a big difference in your daily life.” Is it worth considering taxes when deciding where to live in retirement? “Absolutely,” Fritts says. “There is some overlap with very sunny states and good tax states,” Fritts says. The five states where retirees are moving to most are Florida, North Carolina, Michigan, Arizona and Georgia, indicating that the weather is as much a factor as the tax burden on retirees. Alaska has the lowest tax burden, at about 5.1 percent, with Tennessee in second place, at 5.8 percent. You should take into account all the types of taxes you may pay: on income, property and sales. WalletHub rates New York state as having the highest total tax burden, equal to about 12.8 percent of income, followed by Hawaii, at 12.7 percent. Washington residents have a relatively high burden because of sales taxes. South Dakota has very low taxes overall, relying on taxes on oil and mining companies. “If you live in a state that has no income tax, usually you’re going to see a lighter tax burden - but that really depends on how much your state spends,” says Janelle Fritts, state policy analyst for the Tax Foundation. New Hampshire, however, taxes interest and dividends, according to the Tax Foundation. (To find the maximum income tax in your state, simply mouse over your state on the map above.) Other state taxes fill the revenue void Nine states - Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming - have no income taxes. If you’re looking for a place to retire, low income taxes are good, but no income taxes may be even better. The Sunshine State has no income tax, which can be a powerful draw for people in states with high taxes (and cold winters).
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