Finding a Retirement-Friendly State

yahoo ^ | Friday, December 12, 2008 | Mark P. Cussen

[BenLurkin]

From a tax perspective, determining which state is the "right" state to retire in will depend on the type and amount of income that you reasonably expect to receive. The nine states that, as of 2008, do not assess income tax of any kind (Alaska, Florida, Nevada, South Dakota, Texas, Washington, Wyoming, Tennessee and New Hampshire) do not automatically qualify as the best for all retirees. If you own several rental properties, then the best state for you may differ from someone whose primary income outside of Social Security will come from pensions or IRAs.

There are four major categories of income for which states differ in their methods of taxation:

Pensions Social Security Sales Tax Property Tax

Pension Income

If you're looking to escape taxation of your pension at the state level, your options are pretty limited. Currently, as of 2008, there are only three states that do not tax pension income:

Illinois Mississippi Pennsylvania

New York has stipulations for some government employees to receive tax-free pension income, but not all retirees. These three states exempt virtually any kind of income received from tax-deferred accounts, including pensions, IRAs and qualified plans.

If your pension is from the government or the military, then seven more states open up for consideration: Alabama, Hawaii, Kansas, Louisiana, Massachusetts, Michigan and New York.

If the aforementioned states do not appeal to you as retirement havens, seven others exempt at least a portion of pension income from taxation: Delaware, Georgia, Minnesota, New Mexico, Utah, Virginia and West Virginia.

States that tax all retirement income at relatively high rates include California, Connecticut, Nebraska, Rhode Island and Vermont. More complete information on how each state taxes their residents' pension income can be found at RetirementLiving.com.

[Eric in the Ozarks]

I know that when I pay a business call in Pine Bluff, I’m always packing...

[ConservativeMind]

Ping for later.

[thefactor]

true enough. however, while that might work with other unions it might not with ours.

they could eventually cut benefits, but that might only affect new hires. i think we are grandfathered in no matter what.

they have to consider that if they cut our benefits, people will simply leave the job or not take it in the first place. and as the crime numbers go, so goes the city. they just cut 1,100 new officers and there was an uproar.

it will be an interesting 15 years, that's for sure.

[mylife]

Never been there. I generally carry.

I met some really nice people in Arkansas though around Greers Ferry Lake

[mylife]

that might only affect new hires. i think we are grandfathered in no matter what.

Thats the boat I am in, and I dont trust them

[Alice in Wonderland]

I was a NYC civil servant. Took early retirement at 50 and moved to rural Florida. I like it here.

[gov_bean_ counter]

Some North Georgia Counties

Ellijay in one of those counties???

[thefactor]

always have an out. i am living like i have nothing coming to me. but i am also utilizing a great american strategy: marry someone who makes more than you do! ha.

[mylife]

i am also utilizing a great american strategy: marry someone who makes more than you do!

I am so screwed. I thought we were supposed to make it on our own merits

[smithandwesson76subgun]

Aah a Zappa fan. I myself go for a little dynamo hum.

[mylife]

We are looking at the biggest economical mess of our lifetimes, why has this been relegated to chat?

Is this not News?

[thefactor]

absolutely. but i've been in love with a girl who had no job and felt entitled and thought i should support her. not cool.

now i'm with a girl who has a real job and just happens to do very well. when you're a couple, you are supposed to get by on BOTH of your merits. so i'm ok with it. my ego is fine.

[firebrand]

NYC has great advantages as a retirement city. You don't need to drive a car. Lots of public transportation everywhere at half price. Disabled-accommodating buses. Every kind of entertainment and cultural event you could want.

Of course we all know the disadvantages too.

[mylife]

Personally I dont think marriage should be a business strategy

[JoeProBono]

[thefactor]

and personally i do not think you are qualified to make that judgement from the 10 or so sentences i have written on the subject.

but you think what you wish.

[mylife]

Okey dokey

[elpadre]

Californians have been moving into Idaho and Montana by the droves, and bringing their funny ideas with them, so I’m told by several friends and relatives.

[flash2368]

I live in Moldova. Been here for 5 years. I am 61, my wife is 23. NO taxes on your income from outside the country. Great weather..4 distinct seasons. No humidity in the summer. All the food is natural..they do not allow preservatives in anything. You can actually buy sandwich meat that does not taste like it has been soaked in salt water for six months. Chisinau the capital city is about 1 million people and has everything you might want. The government is “communist”, but in name only. The roads are bad, the gas is expensive. Got cable TV and high speed internet in my apartment. 3 McDonalds if you get homesick. Most things are cheap..bread you would pay $2 a loaf for in the states is 30 cents here. 1.5 liters of really good vodka is about $5. Moldova was the wine and champagne production country for the entire former Soviet Union..you will not find better wine anywhere and its dirt cheap. Capitalism is rampant, plenty of safe investment opportunities..and best of all you can walk the streets alone any time of the night or day anywhere in Moldova with no worry in regard to your personal safety. I have a health plan..costs me 50 euros a YEAR. I need a doctor I call and within 45 minutes I have one knocking on the door that is well trained..even carries a new hotshot German 12 lead EKG machine. Meds to hold me til I get to the pharmacy are included as well as ambulance to the hospital if needed. I need medicine, I go to the pharmacy and tell them what I want.. no prescription needed and the price is often 10% of what it would be in the states. I have a VOIP phone on my internet with a U.S. number that rings here and can talk unlimited to friends and family in the states with crystal clear quality. Everyone here speaks both Russian and Romanian..and many speak some English. So I sit back and watch the political and economic clown circus in the states and wait for the rioting and destruction to start..

[ErnBatavia]

reporting from the enemy-held territory of NYC...

Wifey and I get a kick out of Cash Cab on Discovery Channel, at how the cool and suave Manhattanites that have never seen a tree react to some of the questions.

I was born in Brooklyn, but by the Grace of God my parents moved us out when I was 60 days old. I was back just once for a convention about 10 years ago......and on Cash Cab, I keep missing the questions, because I'm "looking out the window" and marveling how anyone - anyone - could live in that sh*thole.