As a retiree, you might want to consider moving out from your existing set up for all the good reasons, including climate, health care, staying close to family, and for a new beginning. All said and done, the place you move to must be tax-friendly including both state and local state tax laws. This is where you need to judiciously make a decision and look for the right state that offers senior tax breaks for retirees. Here are some states that fit the bill extremely well.
Arizona
This state offers social security benefits exemptions with $2500 of extra income form the state government retirement scheme. Overall the income tax rates are very low including 2.59% on taxable income of $26000 and 4.5% on taxable income of more than $159000. The property tax is below average in the country with only $754 per $100000 on home value. Additionally, this state does not impose any estate and inheritance tax which is great news for senior citizens with high income.
Georgia
This place is home to a large community of retirees for it has the lowest state income tax rate. The social security income is completely exempted from state tax. In the current scenario, the income tax rate will drop from 5.75% to 5.5%, making it a great senior tax break for retirees. There is no estate and inheritance tax in the whole of Georgia. The average property tax rate per year is quite low and nominal than the national average.
Florida
This sunshine capital is undoubtedly the retired home capital for its no state income tax policy. Property tax rates are super friendly with annual property tax is around $4166 on a $400000 home. There is no estate and inheritance tax either.
Mississippi
This state offers the most friendly tax environment for its exempt’s social security benefits from state income tax, excludes withdrawals from IRA and 401(K) plans and other retirement income. The overall property tax rate is below average yet they have annual property tax motor vehicles.
Tennessee
There are no taxes imposed on social security benefits, pension, and other retirement plans. Additionally, one gets a complete 2% exemption in case he or she has a total income of $37000 or less. Sooner the income tax will be removed by 2021. The property tax rates are pretty nominal with access to property tax relief programs and tax reimbursements.
South Carolina
This southern state has a friendly income tax break for retirees and military veterans. Social security benefits are not burdened with any state income tax. $2404 is the average property tax on a home that has a valuation of $400000.
Alabama
This football state offers no tax imposition on social security benefits yet the income tax rate is 5% which is still quite nominal. The property tax is very average with only $1729 per year on a valuation of $400000.
Delaware
This state has no sales tax, low property tax, social security exemptions, no estate and inheritance tax, and reasonable state income tax, making it a haven of senior tax breaks for retirees.
These states offer the best senior tax breaks for retirees. Keep these breaks in mind before moving to the state that suits you best.
