Published by Debra Taylor, | April 18, 2016
In case you didn’t know, state and federal taxes are very different! Generally speaking, federal income taxes are non-negotiable. What does this mean?
Basically, no matter where you live, your federal obligation is essentially the same. State taxes, on the other hand, vary from state to state and, therefore, the same taxpayer could owe very different state taxes depending on where they live.
The highest tax states demand approximately three times the amount of taxes of the most lowest tax states. Indeed, several states require no “income tax” at all. That’s why choosing the “right” dwelling place can make a huge difference when it comes to saving on your taxes, especially for wealthy taxpayers.
A recent survey performed by WalletHub compared state and local tax rates (“income tax” includes various definitions) in the 50 states and the District of Columbia against the Median U.S. Household to determine which states’ relative income tax obligations were the highest. The findings from the study revealed that, for 2016, the 10 states with the highest tax rates are:
The 10 states with the lowest tax rates are:
You can click here to see the full results for all states.
The top ten results for highest and lowest rates are not all that surprising. It’s no secret that New Jersey and New York impose some of the highest tax rates in the country. Likewise, there’s a reason why many people move to and retire in Florida – taxes are low. So, if you’re thinking about relocating and you’re not married to any specific area of the country, consider moving to a lower tax rate state and save yourself some tax dollars.
On that note, HAPPY TAX DAY!!!
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.