State of retirement
If you're old and rich, stay away from Texas, magazine says
It's often advisable to flock to the income-tax-free state of Texas throughout a lucrative career, but the same may not be true for those on the verge of retirement.
Kiplinger has compiled a list of the 10 most tax-friendly states for retirees, and Texas failed to crack it, much to the surprise of many.
The list, which is limited only to the lower 48, thus excluding Alaska and Hawaii, includes states that exempt Social Security benefits from state income taxes, as well as many that exclude government and military pensions from income taxes or offer blanket exclusions up to a specific dollar amount for a wide variety of retirement incomes.
Wyoming took the No. 1 spot, offering no income tax, a four percent sales tax, and no inheritance or estate taxes, followed by Mississippi, Pennsylvania, Kentucky and Alabama.
According to Kiplinger, states that offer generous exemptions for retirees are often more beneficial to pocketbooks than income-tax-free states like Texas and Florida.
So where should you start looking to relocate once your working time is up?
Wyoming took the No. 1 spot, offering no income tax, a four percent sales tax, and no inheritance or estate taxes.
Rounding out the top five are Mississippi, Pennsylvania, Kentucky and Alabama. Would you retire to any of these diverse locales?