State taxes- comparing rates based on a given income

[jIMOh]

I realize trying to generalize taxes is tough.

I'd like to compare the tax rates for states on incomes between 100k and 200k. I just found a definitive state tax table for Ohio (been looking for one for years). I pay a state tax of 6.6% on income between 100k and 200k (plus $4413 of tax on first 100k).

I think this is high for a state tax (6.6%), could anyone chime in as to
a) what is the marginal state tax rate your state has for 100k-200k incomes
or
b) a web site which allows comparison based on income

**I am aware of various websites which show "average" tax burden, and I am more interested in seeing specific tax rates so I can concern myself with my situation (and not worry about low incomes or really high incomes).

 

[FIREd]

In Alabama, the marginal state tax rate for an annual income above $3000 would be a flat 5%. Our effective state tax rate is about 2.7% for a gross income in the 100k-200k range. Long-term capital gains are also taxed at the 5% level.

 

[OAG]

Take a look at VA. Ohio is not very high for me at all but then they DO NOT tax SS Benefits or (effective for 2008, and beyond, Military Retired Pay or VA Disability). They also give a credit for over 65 and IRA RMD's. That reduces my Gross income (which is at $100K) by about 80% for State Tax purposes. My actual tax rate is about 3% on what is left to tax (3% X 20% = less than 1%). In VA my Military Retired pay would be taxed at the state level.

The problem with trying to paint each state is that the "details" have to be looked at closely. You can Google each state to find their tax return publications if you are really into detailed analysis.

 

[ziggy29]

Don't forget about the impact of sales and property taxes, too. Determining the best states for your own tax situation is a multivariate analysis.

 

[FinanceDude]

I live in Wisconsin, which is native American for "tax hell"......I only found that out recently...........

 

[jIMOh]

Right now I want to analyze only income taxes while working (I do pay more in property tax than I do in state tax, but that is another topic for another day). I know I can go to numerous states and look up the info... I actually found better information on my state tax rates from a site on municipality taxes (which showed the state taxes in a table). I had been looking for the information in a concise format and just found it for my state (Ohio).

Thx to those which responded thus far.

 

[OAG]

jIMOh: Maybe this will help (the format is not very good) but it does have a lot of information by state: Individual Income Tax Rates-2008

 

[FUEGO]

Tax Tables

Try this on for size. Google "state tax table" if you want some more hits. I verified that it looks correct for my state. It lists tax rates by income category for singles and married filing jointly.

 

[Lakedog]

Lots of variables involved that are not picked up in many comparison tables -- for instance, Alabama allows full deduction for fed income tax and social security tax paid but many states do not. There is also no annual limit to the capital loss you can claim -- you have to take it the year incurred. Since I tax loss harvested by swapping ETFs last fall, I did not have to pay any state taxes for 2008, but normally the effective rate for me (when working) was around 2.5 to 3% (which agrees with FIREdreamer's experience).

 

[jIMOh]

Tax Tables

Try this on for size. Google "state tax table" if you want some more hits. I verified that it looks correct for my state. It lists tax rates by income category for singles and married filing jointly.

This is the one stop shop I was looking for.

If only this were in a table... I am book marking and will be making a gannt type chart out of this with states along the side, incomes along the top. On a rainy day anyway.

thank you.

 

[Rustic23]

To concentrate on only income tax seems..... well.....dumb! Now if you are somehow going to live in a low property/sales/registration/fee state and claim all you income from say Texas or Fl. then it may make since. But assuming you are going to live where you are going to declare the income, then the cost to live in that place should come into play.

Texas - no income tax, high property tax, average sales tax, in general low cost of living, high heat, bug, alligator index!

I don't know about the other states.

 

[Bimmerbill]

NH, 0 income tax
NH, 0 sales tax
NH, property tax... OUCHIES!

 

[jIMOh]

To concentrate on only income tax seems..... well.....dumb! Now if you are somehow going to live in a low property/sales/registration/fee state and claim all you income from say Texas or Fl. then it may make since. But assuming you are going to live where you are going to declare the income, then the cost to live in that place should come into play.

Texas - no income tax, high property tax, average sales tax, in general low cost of living, high heat, bug, alligator index!

I don't know about the other states.

IMO the easiest way to solve problems like this is to compare one issue at a time, then add the sum together.

For example the link above allows me to check Ohio-KY and Indiana income taxes. I'm not moving anytime soon, just observing more of what the various income tax burdens are in the other locations I could live in now... I know that property taxes (and schools) are higher (and better) in Ohio than the other two choices (you get what you pay for).

But that same analysis in 18 years when I retire will change (don't need the schools).

It's also tough to compare "overall tax burden" because I have a huge house in Ohio which is taxed quite high (like I said my 100k+ income has a lower tax on it than my house). If I were to move to cheaper (lower income tax state), would I get a larger house with the increase in disposable income? Maybe- it's going to be an apples to monkeys comparison any way I analyze it.

So, IMO, it is best to compare only one issue (state income tax), then when the time comes to move, compare the other issues...

I think I can decrease my state tax in retirement (100k=6.6% in Ohio- of course the reference given suggests I pay only 5% and change- HMMM; where as CO is 4.6% across the board and TN is 6% across the board.)

Property taxes cannot be compared because I doubt I would retire to a 3400 sq ft house in a new location. So my property tax bill will be proportional to a smaller house not the one I currently live in.

This is also important for Roth purposes. If the state tax brackets were drastically different, it might make sense to defer taxes now (get a deduction) to avoid paying 15% federal+6% state taxes if in retirement I would be in the 10% federal+3% state tax bracket.

 

[FANOFJESUS]

Here in MO it is 6% also and house taxes around me are about 1.5% of value.
I am guessing that NV or TX (small house)would be the best for OP.

 

[Rustic23]

Ok, I counted 6 states with 'No Tax' case closed. However, I'll bet there are other things your are considering that might rule one or all of them out. Like it may not even be a financial decision. And, if you search, you will see there are several links that do aggregate the total tax burden. However, you are right, it can't tell you what your exact property tax burden or sales tax burden without knowing your specifics. So while I understand looking at each individualy, they still should be considered colectively, along with a desire to live there. i.e. If California was the lowest or all of these, I still would not live there!

 

[FIREd]

I think I can decrease my state tax in retirement (100k=6.6% in Ohio- of course the reference given suggests I pay only 5% and change- HMMM; where as CO is 4.6% across the board and TN is 6% across the board.)

Just to make sure... There is no income tax in TN. You only pay 6% on dividends and interests.

 

[target2019]

This is the one stop shop I was looking for.

If only this were in a table... I am book marking and will be making a gannt type chart out of this with states along the side, incomes along the top. On a rainy day anyway.

thank you.

There is an add-in for Firefox that lets you right-click on the HTML table and copy an asciii table. Can paste that in a private message if you like.

 

[OAG]

NH, 0 income tax
NH, 0 sales tax
NH, property tax... OUCHIES!

With falling home prices, defaults, foreclosures, BIG State Budget Deficit, I wonder if NH will be rethinking this issue? Short of a "Bail out" from the Federal Government or BIG Property Tax Increases, NH is going to have a bit of a BIG issue "balancing" the budget.

 

[Bimmerbill]

Yeah, they are talking about sales/income taxes again in NH. State appears to have flipped from REP to DEM too. Even tho the income taxes are sky high, total tax burden is very low, like 2nd or 3rd cheapest in the nation.

Doesn't make paying my $5K in real estate taxes any easier tho...

 

[shotgunner]

New Hampshire

$42,000 Gross Income - mostly from P/T work

State Income Tax - 0

Sales Tax - 0

NH Dividend and Interest Tax - $147 (5% of every $1 over $2400 earned single filer)

Property Tax - ($4064) $125 Federal tax credit so it's a net $3939 (small house 1000 sq feet with basement and two car garage)

Car registrations are based on value - Another $500 or so on two vehicles there for me

Room & Meals tax of 8% - so I will assume I paid $250 or so.

My state tax burden this year 11.4% or gross income. Next year I expect to make much less working and I anticipate my tax burden may be 20% or gross income.



Problem is my tax burden of $3939 is that amount whether I earned $1 or $1,000,000. It's a great state to be earning a living but not to be retired in. Hoever I live in the desirable and more highly taxed seacoast portiion of the state. I could cut my property tax in half by moving 40 minutes north (where there is much less work and even less "culture")

They have been talking about broad based taxes in NH for as long as I can remember. Democrats control Governor, House and Senate so the threat is more real this time, however the Governor has publicly stated several times he will not support and will veto any attempt at broad based taxation. No part of the property tax goes to fund state government operations. There is mix of business taxes and room and meals tax, fees etc that fund state government.

Broad based taxes in theory would be better for the retirees but it is unlikely that municipalities would let go of the ability to charge property tax. I beleive NJ went down this road and the end result was higher taxes all around.

BimmerBill where you at? I am in Dover.

 

[Coach]

This site has a lot of state tax information. I can't speak for its accuracy, but the Colorado listing looks right.

Coach

 

[FANOFJESUS]

I realize trying to generalize taxes is tough.

I'd like to compare the tax rates for states on incomes between 100k and 200k. I just found a definitive state tax table for Ohio (been looking for one for years). I pay a state tax of 6.6% on income between 100k and 200k (plus $4413 of tax on first 100k).

I think this is high for a state tax (6.6%), could anyone chime in as to
a) what is the marginal state tax rate your state has for 100k-200k incomes
or
b) a web site which allows comparison based on income

**I am aware of various websites which show "average" tax burden, and I am more interested in seeing specific tax rates so I can concern myself with my situation (and not worry about low incomes or really high incomes).

We might be able to help you more if you could give your home size and taxes also. The cost of homes around yours would help also. If you like living in a 4000 sf home we will not talk about texas for you.

 

[harley]

Don't forget local taxes too. I don't think you can make determinations without adding them in. In VA there's just the state income tax rate of 5.75% across the board. But here in MD they have the 5.5% state tax, making it look cheaper than VA. But they also have a county tax of 1.25% - 3.20% depending on which county you live in.

 

[SecondCor521]

jIMOh: Maybe this will help (the format is not very good) but it does have a lot of information by state: Individual Income Tax Rates-2008

This looks right for Idaho, where I live.

You can deduct either the federal standard deduction or your itemized deduction (after adding back any Idaho state income tax paid).

Property tax varies by location, but for Ada County outside of Boise if you figure about 0.5% of your house's market value you'll be a little on the high side. $200K will buy you an average quality new 3br/2ba home with a 2 car garage in subdivision suburbia.

State sales tax is 6% on goods only, not services. Food isn't exempt, but you get a $20pp grocery credit on your state tax return.

There are no local taxes of any kind that I'm aware of.

2Cor521

 

[jIMOh]

There is an add-in for Firefox that lets you right-click on the HTML table and copy an asciii table. Can paste that in a private message if you like.

YES- do you need my private e-mail or can you send it to me on the ER board?

thx