As you look ahead towards your retirement, you may be interested in moving your homestead. There are several different tax friendly states for retirees and potential tax implications associated with staying where you are. Seven states that don’t tax personal income and the two states that collect income tax only on interest and dividend income may be a top choice for retirees.
The seven states that don’t tax income are Alaska, Nevada, Florida, Texas, South Dakota, Washington, and Wyoming. Furthermore, Tennessee and New Hampshire collect income tax only on dividend income and interest. There are also 36 states that allow retirees to exclude part or all of their retirement income from their taxable income. There’s a good chance that retirees will have to pay other types of taxes in the state in which they live such as sales, property and more so it’s important to consider the top states with all of those factors in mind.
And considering those factors, Wyoming and Texas come out on top. Regardless of where you live, you need to carefully consider your residency and how having other properties may influence the overall value of your estate and add to the complexity of estate planning. Consulting with a committed estate planning attorney is not only helpful but something you should do on an annual basis.
