Many American consumers decide to sell their home and move to another state when they reach retirement in order to save costs on a number of things including taxes, health care, gas and their overall cost of living.
If you happen to be one of those consumers, Kiplinger releases a list of their Top 10 least tax friendly states every year and recently released their newest list for 2014. Practically all of the states that they have on their list have state taxes that are well above the $1324 national average, as well as overly high state income taxes, state and local sales taxes and overly high gas prices as well.
If you’re keen on avoiding these overly expensive states in retirement, read below for the Top 5 worst tax States from Kiplinger’s 2014 list. Enjoy.
With state income taxes that range between 1% and 13.3%, 7.5% sales tax and gas taxes and $.53 per gallon (the National average is $.31) the Golden State is not just the home of movie stars and beautiful beaches but also one of the most expensive places to live in the world. Unless you get paid like a movie star, retiring in Cali isn’t a great idea.
The Constitution State that income taxes that range between 3% and 6.7%, state sales tax of 6.35% and gas taxes and fees of $.49 per gallon. They also have the second highest property taxes after New Jersey in the United States. Although they don’t have local sales taxes, luxury items like jewelry that are $5000 or more are taxed at 7%.
3) New Jersey
After New York, the Garden State has the highest combined state and local taxes in the country and seven of the top 10 counties with the highest median real estate taxes. With state income taxes between 1.4% and 8.97% and estate sales tax of 7%, retiring in New Jersey is probably not a good idea. One small thing that New Jersey has going for it is that food, drugs, clothing and footwear are all exempt from the 7% state sales tax, but that’s really not enough to make it worth retiring there.
4) New York
Right next door to the Garden State is the Empire State and, like its much smaller neighbor, New York has very high state income taxes of between 4% and 8.82%, as well as gas taxes and fees of $.49 per gallon. Unfortunately, if you retire there you will have the highest combination of state and local taxes in the United States (and have to live next door to New Jersey).
While it might be one of the most desired vacation destinations in the world, the Aloha State has an extremely high cost of living. State income taxes range from 1.4% to 11% and taxes and fees on gas are $.48 per gallon. One bright spot (pun!) is that, as a percentage of home value, property taxes are low in Hawaii.
And there you go, the Top five most expensive States in the United States as reported by Kiplinger. If you’d like to see their entire list of Top 10 least tax friendly states, you can follow this link: http://finance.yahoo.com/news/10-least-tax-friendly-states-150706051.html