Fidelity's effective tax rates on IRA withdrawals by state

[gfh77665]

Lots of discussion about tax rates from state to state. We all have differing views (and yes some biases), so a neutral, very highly regarded third party's data set is a great to see. Likely the most accurate that can be found.

https://www.fidelity.com/learning-c...?ccsource=email_weekly_0626_1037578_149_0_CV2

 

[javacontour]

If you can stick it out here in IL, taxes on retirees is one thing they have right. No taxes on pensions or other retirement income.

Of course, property taxes take a big big bite here.

 

[Pablo]

When we lived (late 80's) in OR it always seemed like the income tax was not so great, and prop HIGH. It's only become worse since the complete cluster known as Portland happened. There really is no benefit for the average citizen either. It's what happens when crazy idealism rules.

That said, seem imprecise with so many states tied at 7.66%. Will need to read deeper. It does not include other taxes. Funky at best.

 

[edyvw]

Everything is relative. I lived in Alabama, South Carolina, Michigan, California, and Colorado.
In the end of the day, Alabama gets you the least for your money. Some taxes are lower, but wages are far lower, and health care is good in some counties; in some, they would not rank well in the race to the bottom among third-world countries. And sales tax, I moved to CA from AL, and paid less for food, by far, in CA than in AL.
There are too many variables. I find it absolutely ridiculous to decide where to live solely based on tax rates.

 

[Vercingetorix]

Doesn’t include sales tax of which Oregon has none.

 

[Pablo]

Everything is relative. I lived in Alabama, South Carolina, Michigan, California, and Colorado.
In the end of the day, Alabama gets you the least for your money. Some taxes are lower, but wages are far lower, and health care is good in some counties; in some, they would not rank well in the race to the bottom among third-world countries. And sales tax, I moved to CA from AL, and paid less for food, by far, in CA than in AL.
There are too many variables. I find it absolutely ridiculous to decide where to live solely based on tax rates.

I agree, but also no one is saying solely.

 

[Rand]

Pretty simple
that is just a snippit of narrow data
not close to a whole comparable picture.
but for what it is. not too bad.

 

[Pablo]

Lots of discussion about tax rates from state to state. We all have differing views (and yes some biases), so a neutral, very highly regarded third party's data set is a great to see. Likely the most accurate that can be found.

https://www.fidelity.com/learning-c...?ccsource=email_weekly_0626_1037578_149_0_CV2

No. Kinda fail. They used loose language and should have said INCOME tax in the title at the very least.

 

[edyvw]

I agree, but also no one is saying solely.

When people move, that is the main reason. Taxes, as this shows, are always the focus.
And I know people who made that decision based on that factor. And then, they moved somewhere else ASAP.

 

[cptbarkey]

That chart is wrong for Texas, the data is probably trash because it does not take into account property taxes, local sales taxes (mine is 8.25%) and sky high city utility rates (waste water, sewage, gas) with embedded bonds and fees.

 

[edyvw]

That chart is wrong for Texas, the data is probably trash because it does not take into account property taxes, local sales taxes (mine is 8.25%) and sky high city utility rates (waste water, sewage, gas) with embedded bonds and fees.

I have never met anyone who said they are better off financially after moving to TX.

 

[Pablo]

When people move, that is the main reason. Taxes, as this shows, are always the focus.
And I know people who made that decision based on that factor. And then, they moved somewhere else ASAP.

I don't doubt that, but others do include the cost of living in places to move, being aimed toward retirement and getting the most $ and not thinking about much else, maybe.

I think also some people move to place where they can afford to buy or rent and like the climate, well taxes and all other costs - well they sometimes are an "oh shoot" comment (wow expensive moment after moving)

Lots of people USED to move because of jobs. Now people change jobs like underwear.

 

[Pablo]

I have never met anyone who said they are better off financially after moving to TX.

Same for Oregon!

 

[Brons2]

I have never met anyone who said they are better off financially after moving to TX.

Most of my family is, but we moved here from Oregon, so there's that.

We arrived anywhere 20-37 years ago. 36 for me.

 

[edyvw]

I don't doubt that, but others do include the cost of living in places to move, being aimed toward retirement and getting the most $ and not thinking about much else, maybe.

I think also some people move to place where they can afford to buy or rent and like the climate, well taxes and all other costs - well they sometimes are an "oh shoot" comment (wow expensive moment after moving)

Lots of people USED to move because of jobs. Now people change jobs like underwear.

OK, I respect when someone gives me an explanation: hey quality of life is....healthcare is.... etc. Therefore, I made decision.....
But this nonsense income tax etc.

 

[Brons2]

That chart is wrong for Texas, the data is probably trash because it does not take into account property taxes, local sales taxes (mine is 8.25%) and sky high city utility rates (waste water, sewage, gas) with embedded bonds and fees.

The property taxes are getting insane. I probably will retire elsewhere. I pay more than $10K/yr, it's more than my federal income tax.

 

[BMWTurboDzl]

I have never met anyone who said they are better off financially after moving to TX.

Agree although I have a co-worker who left TX for Florida only to return because they decided that their healthcare in Florida was abysmal.

 

[edyvw]

Most of my family is, but we moved here from Oregon, so there's that.

We arrived anywhere 20-37 years ago. 36 for me.

That is absolutely different. We moved to CO before things got super expensive, so we can say: yeah, we actually made some money.
But for us CO was job and a job + skiing. We live here bcs. we love it. If I had a good offer in San Diego, we would stay there. I had good offer in Montgomery, AL. But then, living 8yrs there, I know what the deal is. Super cheap though.

 

[Dave Hess]

Taxes are just 1 part of the big equation of where to live.

I have to live in an area with zero snow is very important to me.

 

[Eddie Hudson]

They are talking about tax on IRA distributions, not ordinary income.