Compare Taxes Before You Retire
Writer’s Note: Low taxes alone are not enough of a reason to relocate when you retire but it is an important consideration. Also, you need to look at the bottom line to understand the net effect for you when you retire. For most, Delaware is either the most tax friendly or one of the best. If that is attracting you to Delaware, however, I recommend that you come and spend some time with us, let us show you the area, and see if you like it here. - Kathy Sperl-Bell
If you plan to move to another state when you retire, take time now to examine the tax burden you’ll face when you relocate. While there are many factors to consider when deciding where to retire and what’s going to be affordable, the different types of state taxes you will need to pay are among the costs to consider when building your retirement plan of action.
A recent article on www.retirementliving.com cites many boomers think that the State’s Income Tax structure is the litmus test for choosing a retirement destination. Boomers should have extra cause for concern since some are on a fixed income. The article goes on to say, “This is a serious miscalculation since higher sales and property taxes can more than offset the lack of a state income tax. The lack of a state income tax doesn’t necessarily ensure a low total tax burden. States raise revenue in many ways including sales taxes, excise taxes, license taxes, income taxes, intangible taxes, property taxes, estate taxes and inheritance taxes. Depending on where you live, you may end up paying all of them or just a few.”
We have compiled the information to make it easy for you to compare taxes in these Mid-Atlantic States… DE, DC, VA, PA, NY, NJ, MD and CT. The taxes that you should evaluate before considering a retirement move are Top Income Tax, Sales Tax, Property Tax, Estate Tax and Inheritance Tax. Download the PDF at the end of this article to print it out!
Top Income: 6.6%
State Sales Tax: None
Property Tax per capita: $737
Estate Tax: 0.8% to 16%*
Delaware’s top individual income tax rate was scheduled to decrease in 2014, but state officials decided to keep the rate at 6.6 percent to plug a budget shortfall. For 2012, the state had the seventh-highest individual income tax collections per person, at $1,307. It also ranks as one of the highest per capita collectors of corporate income tax, placing fifth at $288 per person. *Exemption is $5.34 million.
To compare the other taxes, read the rest of the article on our blog CLICK HERE or paste the following link into your browser. http://blog.activeadultsdelaware.com/2014/04/28/compare-state-taxes