According to a report by a financial website, Wyoming tops the list of the best tax states for retirement.
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Sound financial planning is critical when deciding where to spend your retirement. This usually means considering factors such as housing, healthcare costs, and overall cost of living. It’s also important to choose a state with a low tax burden to make your every dollar count. According to a report by financial website InsiderMonkey.com, Wyoming tops the list of the best tax states for retirement.
The Equality State is one of eight states with no income tax. This means retirees get to keep all of their Social Security benefits, private or public pensions, and retirement plan payments. Additionally, Wyoming also doesn’t charge estate or inheritance taxes.
However, what sets it apart is a recent bill that created a property tax exemption for seniors 65 and over. House Bill 3 states that long-term homeowners in Wyoming can defer 50 percent of their property taxes if they have continuously paid them for 25 years. The bill will go into effect on Jan. 1, 2025, and expire on July 1, 2027.
But even if you don’t qualify for this exemption, the Equality State is known for its low property tax rates, which, at 0.58 percent, are the tenth lowest in the country. This, combined with median home values below the national average, reduces the financial burden of buying new property there.
And lastly, while Wyoming does have a sales tax, the rate is the fourth lowest nationwide, and groceries are exempt from it.
According to data by the Tax Foundation’s State and Local Tax Burdens for 2022, Wyoming has the second lowest tax burden overall, after Alaska, with an effective tax rate of 7.5 percent and a general cost of living seven percent lower than the national average.
Retirees seeking tranquility and space will certainly find it here since Wyoming is the least populated of all, and with 10 National Parks Service sites, it provides plenty of opportunities to stay active outdoors.
Nevada is the second most tax-friendly state for retirees, according to InsiderMonkey.com’s report, which highlights the Silver State’s no income tax and low property taxes. Alaska is third, which, in addition to having a low tax burden, also pays eligible residents a yearly dividend of $1,312 thanks to its rich oil and gas reserves.
You can read the entire ranking on insidermonkey.com.
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