I know so many people say that a move should not be about taxes. Well in this day and age where taxes seem to be going up and the government spending all of that and more it has to enter into everyone's equations.
South Carolina is second in my list of states that I am considering. So to help me either drop it off the list or to move it up to tie in first I have a few questions. I am going to post information gathered about income tax and I hope that someone with experience here can answer them.
Personal Income Taxes
Tax Rate Range:
Low – 3.0%; High – 7%; No tax on the first $2,630 of taxable income in tax year 2007.
* Lowest – $2,800; Highest – $14,001
Number of Brackets:
* Single – $3,700; Married – $7,400; Dependents – $3,700
Single – $5,700; Married filing jointly – $11,400
Federal Income Tax Deduction:
Retirement Income Taxes: Retirement income is taxed.
Social Security is exempt. Under age 65, $3,000 in pension income is exempt. If you are 65 or older you may exempt $15,000 of retirement income. You can take this deduction for income received from any qualified retirement plan.
If both spouses receive retirement income, each spouse is entitled to an individual deduction. The $15,000 deduction must be offset by any other retirement deduction that is claimed.
A surviving spouse may continue to tacke a retirement deduction on behalf of the deceased spouse. Some taxpayers age 65 and older may not have to file a tax return if they meet certain conditions. For more information,click here
Retired Military Pay:
Retirees with 20 or more years of active duty can deduct up to $3,000 annually until age 65 and up to $10,000 per year after age 65. This deduction extends to the surviving spouse. Pension or retirement income received for time served in the National Guard or Reserve components is not taxable.
Survivor benefits are taxed following federal tax rules.
The lines in red are the questions.
1. retirement income is taxed. does that count for 401k withdrawals?
2 & 3. combination of all income from pensions gets 3k deduction <65 and 15k 65>?
4. National Guard pension is exempt, does that count for soldiers that earned the pension while serving in another state?
That last one is important. Some of the others I can kind of guess but it would be good to know the whole story. I have two pensions, one military and the other FERS. Outside of the tax situation SC has a nice COL and the weather is okay. It is also closer to New England and our only child. It might be a pretty good location for us. We will visit it before making our decision anyway.