That makes me want to convert all of mine and my wife's 401K money to Roth IRA's before I move to Georgia if I do move there in retirement. Since my wife and I will retire in different years, she before me, I plan to convert a huge chunk of her 401k each year to her Roth IRA -- as much as I can each year w/o going into a higher federal tax bracket. Then later when I retire do the same with my 401K.
But that means the first few years I'm retired I'll have a large taxable income for myself -- well past $65K. Hmmmm...of course I plan to retire in my late '50's anyway so I guess it won't matter. By the time my wife and I are 65 the only taxable income we'll have will be two pensions (which are taxable in Georgia, but neither over $65K) and each of us having SS (which is not taxable in Georgia). I should be done with Roth conversions even before we turn 62 (the lower Georgia income reduction for seniors).
Yours is an excellent, well thought out, strategy. I wish I had done the same with my Roths...20-20 hindsight.
The Georgia exemption is applied individually, even when filing a joint return. This includes the age of the individual. From age 62 to 64, the exemption is $35K. At age 65 and older, the exemption is $65K. Also, it only applies to retirement income, listed on a 1099. Income listed on a W2 is taxed, no matter what your age.
So, if you are 65, your exemption would be $65K and then if your wife is 62, then her exemption would be $35K. Turbo Tax handles this perfectly.
The school tax exemption that I mentioned in my previous post is done at the county level. Prior to getting the exemption, my annual property tax was around $4500. This year, it is $950. Should you decide to move to Georgia, the county you move to is important. I am in Cherokee County, about 35 minutes northwest of downtown Atlanta.
If you have specific questions, you can send me a PM.