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Old 09-27-2011, 03:22 PM   #41
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What happens if you live in a state that has state taxes but fly over to a non state tax and withdraw?
The airfare will eat into your earnings.

Kidding aside, taxes are based on your state of residency. What you are proposing won't change your tax liability and might land you in jail for tax evasion.
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Old 09-27-2011, 03:50 PM   #42
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What happens if you live in a state that has state taxes but fly over to a non state tax and withdraw?
I'm pretty sure the taxes are based on your legal residency, not where you withdraw.

Which could still mean that if you live in a no-income-tax state and are contemplating a move to a state where retirement income is taxed, it may be a consideration as to when, whether and how much to take out while you are still clearly and legally a resident of the no-tax state.
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Old 09-27-2011, 06:06 PM   #43
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oops! The chain just broke.
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Old 09-27-2011, 06:27 PM   #44
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The airfare will eat into your earnings.

Kidding aside, taxes are based on your state of residency. What you are proposing won't change your tax liability and might land you in jail for tax evasion.
So I guess if you plan to retire in a non state tax then you are good to go.
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Old 09-27-2011, 06:30 PM   #45
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So I guess if you plan to retire in a non state tax then you are good to go.
I don't believe a "non state tax" location exists - at least not in the US. Texas has no state income tax but we pay hefty property and sales taxes. Every state finds a way to get your money...
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Old 09-27-2011, 06:48 PM   #46
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I don't believe a "non state tax" location exists - at least not in the US. Texas has no state income tax but we pay hefty property and sales taxes. Every state finds a way to get your money...
Yep -- but the best we can do is consider our own situation in terms of income, spending and homeownership. Texas is a "good" tax state for someone who has a high income, doesn't spend much and lives in a modest, low-value home. On the other hand, if you have a big, expensive residence and are spendy, it's not so good.

On the other hand, a state like Oregon, with no sales tax but a pretty harsh income tax, is better for folks who spend a lot of their money and don't have much income.
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Old 09-27-2011, 07:09 PM   #47
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Sorry to take the thread in another direction (retirement taxes), but some states (such as where I live) treat retirement income in a better manner than others:

Kiplinger.com

While we have a state income tax, I don't pay it since my retirement income (SPIA, T/Roth IRA's, etc.) nor my future SS fall under the requirements to report.

We also have a 1% local income tax, but again don't have to report my retirement income...
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Old 09-27-2011, 07:17 PM   #48
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I don't believe a "non state tax" location exists - at least not in the US. Texas has no state income tax but we pay hefty property and sales taxes. Every state finds a way to get your money...
I meant no state income tax.
Which states are tax friendly for 401k/Roth IRA?
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Old 09-27-2011, 07:34 PM   #49
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You can find out all sorts of good info from previous threads by going up to that Google search box at the top of the page and searching on 'tax friendly states'.
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Old 09-27-2011, 07:51 PM   #50
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You can find out all sorts of good info from previous threads by going up to that Google search box at the top of the page and searching on 'tax friendly states'.
I have heard a lot about Texas Hill Country and how great of this place is for retirement. I believe its close to Austin.
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Old 09-27-2011, 09:18 PM   #51
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Back on topic, this actually isn't a "crappy" article as someone said above. As it states in the first paragraph, the goal in the study was how to maximize your standard of living over your life, not how to maximize your retirement savings.

So yes, you can live as cheaply as possible, never take vacations, etc for 40 years and then enjoy a glorious retirement for the next 20; or you can live moderately for 40 years and moderately for the next 20. This study focused on the latter, that's all. I don't think either view is wrong, just depends on how you want to pace things in life.
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