Living in Florida, wanting to retire to a more tax friendly state, SC or GA,

[In Fl and hoped for More]

Ok so whats wrong with FL? Property taxes are IMHO unconstitutional and very unfair. Local sales tax is high. Tag tax, every so often an additional county tax, all the taxes labeled as fees are high and going higher to offset "No income tax."
That said, living near Clearwater in the greater Tampa Bay region, we'd prefer a little more winter or change of seasons. Originally from NJ. Never going back. I am retired Army and have had other jobs that will help in retirement. Wife is a Banker and will have a pension and SS. We have over $700k in various financial vehicles that we are happy with.
What we are looking for is less property tax and the other fees that I talked of earlier.
We are considering SC or GA. Specifically Charleston or Savannah areas.
Can anyone comment on the tax situation there as well as the pros and cons of each area in terms of quality of life. Are there hidden costs? How are the prop taxes? any gotcha kinds of policies?

 

[imoldernu]

My comments here, on a somewhat related subject...

http://www.early-retirement.org/forums/f28/anybody-upsizing-their-house-in-retirement-without-a-mortgage-70976.html#post1425014

Re: taxes... If you're determined to live near the ocean, this wouldn't work, but, take a look at the housing market in and around my summer community in Leesburg. The property taxes IMHO, are pretty low... Houses that were built in the late 80's and 90's and sold for $300k at the time, are now much less, we looked at homes (originally $250K now $160K)... taxes $1800.
We're pretty well settled in IL, now, so no moves for final residence, but had considered NC or SC... Still going back and forth to avoid the FL summers, though as one grows older and less active, the airconditioning suffices for the hot months.
For some details about cities you may be considering, try this site:
http://www.city-data.com/

 

[45th Birthday]

I'm not sure I agree with your view of the taxes.

We have a house in Illinois that is worth probably no more than $1.1 million (despite having $1.75 million in it). We are under contract to buy a condo in Florida for $1.5 million. The real estate taxes on the house in Illinois next year will be just under $20,000. The taxes on the condo, just over $19,000. Florida wins.

In Illinois, the sales tax is anywhere from 7% to 9% (or more in Chicago). In Florida, 7%.

Not sure what a tag tax is, but if it's related to autos, we pay $100 to the state and $85 to the town each year for each vehicle.

The Illinois income tax is 5% with basically no allowance for deductions. The only good thing is that retirement income is not taxed.

The kicker is the estate tax. In Illinois, it can be as high as 16%. Florida: zero.

 

[alaska55]

SC or GA

Just happen to read this. This is from Kiplinger mag,looks like it's a toss up.

State-by-State Guide to Taxes on Retirees-Kiplinger

 

[OAG]

OP be careful because sometimes there are hidden taxes one would never expect. Here in OH there is an income tax but for retired military, since 2008, that pension is excluded from State Taxes along with SS Benefits so OH appears to be very tax friendly at least on the State Tax level. However State and local Sales Taxes used to be reasonable at 6.75% but in about a 6 month period they have risen to 7.5% (very rapid changes: first by .25% then by .5% a few months later). Additionally many cities and towns in OH have a tax on income earned in the city or town to the tune of a flat 2-2.5%. The other pretty large tax comes in property taxes where the School Taxes are added to the property taxes (a funding process that has been cited as unconstitutional by the OH State Supreme Court - but no one seems to be in any hurry to correct). This is large in that our PP without school funding would be about $3000 but it is actually about $7,500 per year (and that is after the Homestead exemption the county provides). I know from your post you did not intend to move to OH but I just thought the foregoing may be of interest. We lived in NE Florida (Clay County) for about 20 years but moved in 2005 for reasons unrelated to taxes. If taxes had been a factor believe me we would NOT have moved from FL. Be cautious an do your own due diligence and don't believe everything on those city search type sites as they are not always up to date to say the least.

 

[jclarksnakes]

I am retired here in Savannah so maybe I can help. We pay around 2K in property taxes on a 125K tract house inside the city limits but outside the historic district. Houses are relatively inexpensive outside the historic district. Here in the city we have a local option sales tax so that total sales tax is 7.5%. State income tax?....most income is taxed at 6%. But this year we are turning 62 and get a big break on that. For ages 62 and older the first 35K of retirement income (pensions, SS, withdrawals from IRAs, 401ks etc.) per person is exempt. The 35K exemption goes up to 65K per person at age 65. Annual vehicle registration which is mostly ad valorem tax is a couple hundred per vehicle. There is an exception for any new vehicle you buy in the state. You pay a one time sales tax (around 8% I think) on new vehicles and thence do not have to pay annual ad valorem taxes on the vehicle. This place is interesting. Some people like it here, some do not. The historic district is beautiful. I would suggest that you come stay in one of the B&Bs or downtown hotels for a long weekend to get an idea about whether you would like it here. We have more seasonal weather change than you do in the Tampa area but it is still hot here in the summer. Most winters are mild but this one has been chilly and drizzly. Spring and fall are really nice here every year.

 

[In Fl and hoped for More]

Thanks Chief,

I'd like to know more about the area and will visit soon. Are there areas you would suggest looking for housing and areas to stay away from? If we do this it will be the final PCS, but I want to get it right. We like fine dining once in awhile, enjoy bellying up to a good local dive and she likes a beach now and then. Proximity to Mil health services will become important as well.
We'd appreciate all info you can give...

Thanx

 

[MBSC]

For South Carolina: http://www.sctax.org/nr/rdonlyres/581cad16-08d2-4f4b-b760-92ce8621875f/0/pub1_04252011.pdf

Property taxes in SC vary by school district. There are also annual property taxes due on cars and boats. Sales tax varies by county and cities can impose an additional sales tax on top of the county sales tax. My small city is not near Charleston but charges 1% or 2% sales tax on groceries depending on the county, 10% for prepared meals (restaurants) within the city limits and 8% on most other items including restaurants outside the city limits.

 

[jclarksnakes]

Thanks Chief,

I'd like to know more about the area and will visit soon. Are there areas you would suggest looking for housing and areas to stay away from? If we do this it will be the final PCS, but I want to get it right. We like fine dining once in awhile, enjoy bellying up to a good local dive and she likes a beach now and then. Proximity to Mil health services will become important as well.
We'd appreciate all info you can give...

Thanx

Housing choice very much depends upon what you are looking for. Some people come here for the historic ambiance and buy in expensive areas of the historic district. There are also many water and marsh front areas with nice and expensive houses. The beach at Tybee Island is not as nice as beaches you are used to in Clearwater. There are loads of great places to eat here. We utilize the small Tuttle Health Clinic at Hunter Army Airfield here in Savannah. It does have limited services available so we have to go to the larger hospital at Fort Stewart for anything more than routine medical stuff.

 

[sengsational]

I concluded a few months ago that I probably pay about the same property tax in Charlotte, NC as my sister in Zepherhills, FL. So you might be able to escape higher property taxes just by moving a few miles?

 

[jclarksnakes]

I have relatives all over Florida. In discussions with them it seems that most of them pay pretty reasonable state and local taxes. They do pay more in real estate taxes than we do here in GA but the difference has been far less than what we have been paying in state income tax. I would say that for young working people Florida with no state income tax is more tax friendly than Georgia and that for most retirees 62 and older Georgia is more tax friendly than Florida.

 

[sengsational]

They do pay more in real estate taxes than we do here in GA but the difference has been far less than what we have been paying in state income tax.

I agree and thats probably also the case for NC. As a retiree that will be showing income from tax advantaged accounts, you would probably be better off paying slightly more property tax, and not get slammed by 6 or 7 percent income tax on your IRA withdrawls.
​

 

[davismills]

I'm actually thinking of moving to Florida from Georgia. I have a motor home and two cars. My ad-valorem taxes on the vehicles is $1500 per year on top of $3000 in county and city property taxes. I'm currently in the 15 percent tax bracket and Georgia will charge me 6 percent in capital gains upon sale of stocks. I just can't believe that Florida would not be an advantage over Georgia at this time. The ad-valorem was repealed for for vehicles purchased after 2013. I don't want to pay state taxes on my non-qualified gains nor my qualified withdrawals in the future. I'm asking for any advice on the pros of moving to Florida.

 

[jclarksnakes]

I'm actually thinking of moving to Florida from Georgia. I have a motor home and two cars. My ad-valorem taxes on the vehicles is $1500 per year on top of $3000 in county and city property taxes. I'm currently in the 15 percent tax bracket and Georgia will charge me 6 percent in capital gains upon sale of stocks. I just can't believe that Florida would not be an advantage over Georgia at this time. The ad-valorem was repealed for for vehicles purchased after 2013. I don't want to pay state taxes on my non-qualified gains nor my qualified withdrawals in the future. I'm asking for any advice on the pros of moving to Florida.

How old are you? If you are young the move to Florida may be good for tax reasons. If age 62 or getting close it may be better tax wise to stay in Georgia.

 

[davismills]

I'm 59 and ERed last year. Since we're planning to delay SS until 70 AND will be required to take RMDs, our retirement income will be north of 140K annually. GA will still slaughter me, I'm afraid. We're also hoping to downsize in square footage, so I was hoping the property taxes would be a wash. We're taking the gas guzzler down to Melbourne in May to check out that area. BTW...retired Air Force, Chief.

 

[MBSC]

I'm 59 and ERed last year. Since we're planning to delay SS until 70 AND will be required to take RMDs, our retirement income will be north of 140K annually. GA will still slaughter me, I'm afraid. We're also hoping to downsize in square footage, so I was hoping the property taxes would be a wash. We're taking the gas guzzler down to Melbourne in May to check out that area. BTW...retired Air Force, Chief.

You may be interested in this thread regarding retiree tax incentives in Georgia.
http://www.early-retirement.org/for...t-as-good-as-it-looks-for-a-senior-71621.html

In addition to standard deductions and exemptions, Georgia offers retirees ages 62-64 an additional $35K income deduction and those 65 and over an additional $65K income deduction each ($130K per couple).

 

[48Fire]

Florida car insurance is usually an increase. About $500 per year for us.

Sent from my SCH-I535 using Early Retirement Forum mobile app

 

[nwsteve]

This info from wallethub.com just was posted on CNBC may be helpful.
States with the Best & Worst Taxpayer ROI | WalletHub®. Florida is ranked 4 overall for total tax costs and Texas 7 but they are tied at 7 for return on taxes.
Interesting is that Florida is only 38 in Govt Services while Texas is 24. Our no income tax state of WA is 6 in having lowest taxes but 4 in return on tax despite being 10th in government services. Go West young man ;-)
Nwsteve

 

[jclarksnakes]

I'm 59 and ERed last year. Since we're planning to delay SS until 70 AND will be required to take RMDs, our retirement income will be north of 140K annually. GA will still slaughter me, I'm afraid. We're also hoping to downsize in square footage, so I was hoping the property taxes would be a wash. We're taking the gas guzzler down to Melbourne in May to check out that area. BTW...retired Air Force, Chief.

As has been posted above the tax breaks in Georgia kick in at age 62 and get bigger at age 65. We also will have income over 140K after we are collecting SS and RMDs kick in. If we are careful about picking the sources of our spending money to keep combined income below around 85k until we turn 65 we will perhaps never pay another cent in state income tax here in GA. I think you are looking at this backwards. If tax considerations alone were considered in your choice of where to live you should now be living in Florida and stay there until you turn 62 and then move to Georgia. And thank you for your service.

 

[davismills]

After careful consideration, much research and great advice from you all (especially jclarksnakes), we're most likely going to remain in Georgia and downsize to a smaller house here. We'll do a short "snowbird" trip each year and get our taste of Florida then. The constant yearly assessments of homes, extremely high insurance costs and the threat of hurricanes have scared me away from Florida. The recent changes to the tax structure in Georgia have made remaining here much more palatable. jclarksnakes: Thanks for your service too.