Is it Alaska, Florida or somewhere in between?

I have been thinking about taxes in retirement recently.  I even had a conversation with a friend that is also exploring retirement.  I had even explored my own state of Virginia which offers seniors no tax on the social security benefits and $12.000 cap on benefits beyond the social security before state tax is imposed.  My friend had reported to me that the state she and her husband plan to retire to offers a $41000 cap on social security income, IRA’s and pensions per person.  We had both always felt our only break for state taxes would be to maintain a residence in Florida.  I was somewhat relieved to know that I could maintain my home in Virginia with a somewhat lowered tax rate.  I put this on the table for another day’s exploration.    An article in USA TODAY mobile app caught my eye yesterday, “10 worst states for retirement” (Brody, 2014).  The link is at the bottom of the page if you want to explore this list.  Much has to do with high estate taxes but there are other issues as well. Most appear to be taxes or financial issues.  I thought I might as well explore what is the best state from a tax or financial standpoint to consider for retirement.  I found the list!  In  Kiplinger online,  there is a list published in August, 2013 (“10 Most Tax Friendly States”, 2013.) This link too is available at the end of this blog article.  It does appear from a tax standpoint that Alaska has no state income tax, no sales tax, or no estate tax.  I figured I must check for Florida on the list.  It does have a sales tax but no income or estate tax.  The others listed have many of the mentioned taxes but at a lower rate than others.  I suppose it is not all about the tax but it can  enhance one’s lifestyle with a little more funding available.  Family presence and especially locality of one’s children and grandchildren is important in the consideration of where to settle.  If one is going to be a part- time resident in a particular state to maintain lower tax rates, it would nice if that state had things to offer that were appealing to a preferred lifestyle.  For some that might be weather and for others it might be friends or family.  I hope you explore the links below.  There is some interesting information about the 10 on each list.  Comments are welcome.  I love to know what readers are thinking and considering especially if you follow the links.

“10 Most Tax Friendly States”.( 2013).  Retrieved from http://www.kiplinger.com/slideshow/retirement/T006-S001-10-most-tax-friendly-states-for-retirees/

Brody, J. (2014).  “10  Worst States for Retirement”.  Retrieved from  http://www.usatoday.com/story/money/personalfinance/2014/04/19/retirement-states-taxes/7788891/