Your State Tax Burden

[JPatrick]

A pretty good layout of tax burdens by state (or degree of patriotism depending on your politics.)
The article contains a map depicting the deviation of each state's burden compared to the national average.
Even more nifty is the slider feature that shows the change in the degree of burden (patriotism) over the years. For the states I'm familiar with, it is pretty dang accurate, and I'd expect that slider light show will get an even greater workout in the years to come..

How High Is Your Tax Burden? - Forbes.com

 

[samclem]

A good quick presentation. They should do another one that shows the absolute (rather than between-state relative) changes over time.

 

[gryffindor]

Almost looks like the infamous 2000 red - blue map.

Glad to see as a Marylander that I am paying my contribution (10.8%, sigh).

Interesting nugget -- even though the presidential election tax contribution doesn't increase your overall taxes, only 12% of citizens voluntarily pay it

The Tax Foundation - The Presidential Election Campaign Fund: A Voluntary Tax That Stirs Little Enthusiasm

 

[Independent]

If you follow this back to the source at: The Tax Foundation - State and Local Tax Burdens: All Years, One State, 1977-2008

you will see that the Tax Foundation calculates "tax burdens" in two parts. Taxes you pay to your own state, and taxes you pay to other states. For example, California residents who visit Lax Vegas pay hotel taxes in Vegas, those taxes are included in the CA "tax burden".

That seemed like a small technical detail to me, but the numbers are large. Overall, US residents pay $4,283 in state and local taxes per capita. Only $2,924 of that goes to the state where they live (and presumably vote), the other $1,358 goes to other states.

The article mentions hotel taxes, sales taxes, and income taxes paid by non-residents as examples. I'm surprised that the number was so high. Maybe someone else has an idea. At any rate "low burden" and "low state spending" are not the same thing.

 

[M Paquette]

The Tax Foundation, The Tax Foundation - Educating Taxpayers Since 1937, has lots of other interesting numbers beyond the 'tax burden' figures.

One of the more interesting in this time of state budget crunches is the Federal Spending Received Per Dollar of Taxes Paid by State table. Now, given that the Federal government has been spending considerably more than it brings in through taxes, one might expect that states would see more coming in than goes out to the Federal government, that is, for each $1 in Federal taxes, they might see $1.10 in Federal spending.

That's true for some states, with New Mexico and Mississippi leading the pack at over $2 coming in for each $1 going out to the Federal government. For other states, not so much. New York got $0.79 for each dollar, and California got $0.78. Curiously, it looks like many of the states having budget problems are also the ones with the lowest return on their Federal tax dollars.

 

[Independent]

It would be nice if the Tax Foundation provided a worksheet that showed the dollars by spending and tax types. I haven't been able to find it, maybe you know where it is.

I did find this:

However, demography may be more influential than politics. States with more residents on Social Security, Medicare and other large federal entitlements are bound to rank fairly high. Similarly, the high spending levels in Virginia, Maryland and the District of Columbia are explained by the predominance of federal employees.

On the tax side of the equation, states with higher incomes per capita— New Jersey stands out—pay much higher federal taxes per capita because of the income tax’s progressive structure. The citizens in these high-income, high-tax states do not always live better or save more than people in low-income, low-tax states because the cost of living is usually that much higher or more.

The Tax Foundation - Federal Taxing and Spending Benefit Some States, Leave Others Paying Bill

 

[M Paquette]

It would be nice if the Tax Foundation provided a worksheet that showed the dollars by spending and tax types. I haven't been able to find it, maybe you know where it is.

There's this: Average Dollar Tax Burdens by Type of Federal Tax, Per Household, Calendar Year 2004

There's a huge stash of state tax data as well.

The Tax Foundation is interested primarily in tax issues, There's not much on spending there.

 

[freebird5825]

from
How High Is Your Tax Burden? - Forbes.com

Why am I not surprised about the NY data ?
Caveat - the data is heavily influenced by the NYC metro area and suburbs. I'm actually in a low cost area.
I showed dh2b the actual numbers for my pre-FIRE state income tax.
Astronomical compared to my post-FIRE income, all of which is zero state taxable. He looked at his own state earned income tax, and just about fell off the chair. Throw in the property taxes and high sales tax and you really need a Rolaids.
He is more than ready to leave this state for this very (overall tax burden) reason. Only 10 more years til he can retire.

 

[Gone4Good]

My conclusion from the map . . . a state's tax burden is directly correlated with its desirability as a place of residence.

 

[FANOFJESUS]

My conclusion from the map . . . a state's tax burden is directly correlated with its desirability as a place of residence.

I agree with that for most of the country but Reno and Colorado Springs both look good. Reno does require alot of $$$ for cost of living that is the down side.

 

[Notmuchlonger]

I agree with that for most of the country but Reno and Colorado Springs both look good. Reno does require alot of $$$ for cost of living that is the down side.

I think Texas is great. It does fairly well on that map. Missouri is a nice place too.

 

[ziggy29]

My conclusion from the map . . . a state's tax burden is directly correlated with its desirability as a place of residence.

To each their own -- personally I think you're dead wrong. Then again, I've never claimed to want to be terribly cosmopolitan, sophisticated or progressive.

I guess that's why it's a big country with 50 states. We presumably get to vote with our feet.

 

[Independent]

There's this: Average Dollar Tax Burdens by Type of Federal Tax, Per Household, Calendar Year 2004

There's a huge stash of state tax data as well.

The Tax Foundation is interested primarily in tax issues, There's not much on spending there.

I apparantly wasn't clear. The table on "tax burden by state" gives the results of a study, but it doesn't give the details. I was surprised that the Tax Foundation has so much tax being paid by out-of-state people, so I was looking for exactly how they decided to allocate various taxes. I was looking for the step-by-step process they used to get the numbers.

Same idea for Federal taxes vs. benefits by state. It seems they print a lot of results, but I can't find their methods.

 

[atlas888]

I was thinking about moving to Texas because there is no state income tax. But there is a 3% property tax. So one may actually lose out by retiring to those income-tax free states which depends on property tax for revenue. The retiree will not be working, so there is no income from employment from year to year, but he/she has to pay 3 % on let say a 300,000 home (and that is cheap for Florida or Seattle) year after year. It will make sense only if a person rents, I suppose.

 

[LOL!]

My home is not even assessed at $300K. Do you need 4 br, 3.5 ba, 2 car garage, 3000+ sq ft? If so, your home will still be less than $300K.

 

[samclem]

It will make sense only if a person rents, I suppose.

Even then, the state taxes are "baked in" to the monthly rent. Since it is just another cost all landlords have to pay, you can bet all rents are higher by the amount of the tax.

 

[RunningBum]

Property taxes in Texas are at a local level, like every other place I've been. You've got a county tax, a city or municipal utilities tax, a school tax, and maybe even one or two other small taxes. People 3 blocks away from me had a different tax rate because they were in a different MUD or inside the city limits. I don't think I was quite at 3%, but it was close, and that's not a bad rough estimate to use.

If you rent, you don't directly pay your tax, but don't you think your landlord is going to pass their tax burden onto you? And it may be worse, because they won't get the homestead exemption.

The property tax factor in Texas is certainly one to look at closely, especially for retirees.

 

[Helen]

I guess that's why it's a big country with 50 states. We presumably get to vote with our feet.

This is what I did. I felt like I was being taxed to death in Massachuetts and received very little in the way of benefits. I moved to Oregon where the lifestyle is a much better fit for me. With all the state and federal land to enjoy I feel like I get a lot more for my tax dollars.

 

[REWahoo]

Property taxes in Texas are at a local level, like every other place I've been. You've got a county tax, a city or municipal utilities tax, a school tax, and maybe even one or two other small taxes.

Yep. Living in the sticks, I have no city tax but I do pay school, county, road & flood, groundwater, emergency service district, hospital district, community college district, plus flea, tick & screwworm eradication taxes.

 

[Martha]

Screwworm?

 

[REWahoo]

Yep. They recently invaded California: Screwworms: Be on the Lookout, UC Davis Veterinary Medicine Extension

 

[bbbamI]

Screwworms....as if we didn't have enough critters. Crap.

 

[atlas888]

I looked at the rent of a 2 bedroom apartments in Texas, and they are around $ 800 to 900 per month. 3% property tax on a $ 200000 house would be $ 6000, and I do not have to come up either with the $ 200000 or pay mortgage interest. I also do not have to take care of the lawn and other chores. There is also the headache of eventually selling the house I bought. So even if I have to pay the property tax for the landlord, it still appears to me to be better deal.

 

[RunningBum]

Don't forget to factor in house appreciate rates and rising rents over time.

 

[LOL!]

We live in an expensive area of TX. We pay property (all-in) taxes about a 2% rate of assessed value. Even though you might pay $900 a month in rent, you may find you can buy a wonderful house for a smaller mortgage payment that includes your taxes (PITI). Huge 3 br 2 ba homes are selling in nice neighborhoods for $80K to $150K.

While maybe renting is something for you, I think you need to use some real numbers for the specific location that you think you might move to.