Author Topic: Any Pennsylvanian staches?  (Read 2178 times)

stein79

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Any Pennsylvanian staches?
« on: February 16, 2017, 02:42:38 PM »
I am hoping to get some tax advice from any current or prior residents of the commonwealth of PA.

I currently live in Baltimore but am looking to move north along the I-83 corridor.  I've looked a little in the southern York co area at houses in close proximity to 83.

At first glance the houses are nice, new, and you get much more vs. Maryland.  However, I have been reading and it seems that PA has a lot of taxes for residents over Maryland (a state that taxes a ton too).

Can anyone offer some clarity to help me out?
Anyone gone through the same decision i'm considering?  Maryland is pretty high COL so I don't know if there are many members here.

Thanks in advance

CareCPA

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Re: Any Pennsylvanian staches?
« Reply #1 on: February 16, 2017, 02:58:52 PM »
The biggest factor I would look at is property taxes. Depending on area they can be a high percentage of house value.
The 3.07% income tax is actually pretty nice. But then you'll have 1-2% local income tax (only on earned income). No tax on retirement income of course.
Sales tax is 6% (higher in Philly), but does not apply to clothing or food currently (also some services like accounting).

Any other specific ones you're looking for?

CareCPA

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Re: Any Pennsylvanian staches?
« Reply #2 on: February 16, 2017, 03:05:57 PM »
Also, if you are working in MD and living in PA, you'll want to see if there is a reciprocal income tax treaty for state income taxes. Otherwise you could end up paying the higher of the two income taxes needlessly.

emiloots

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Re: Any Pennsylvanian staches?
« Reply #3 on: February 16, 2017, 08:08:44 PM »
The biggest factor I would look at is property taxes. Depending on area they can be a high percentage of house value.
The 3.07% income tax is actually pretty nice. But then you'll have 1-2% local income tax (only on earned income). No tax on retirement income of course.
Sales tax is 6% (higher in Philly), but does not apply to clothing or food currently (also some services like accounting).

Coming from New York, Pennsylvania's taxes are pretty good.  The state has a flax tax on income, and you should be able to look up local taxes for areas you're interested in ahead of time.  Property taxes will be your variable, but if you plan on renting then it's not a worry.  529 contributions (it does not have to be a PA plan) are state tax deductible up to 14k or 28k (if married filed jointly) per beneficiary per year.  Best of luck with your decision!

CareCPA

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Re: Any Pennsylvanian staches?
« Reply #4 on: February 17, 2017, 04:04:41 AM »
The biggest factor I would look at is property taxes. Depending on area they can be a high percentage of house value.
The 3.07% income tax is actually pretty nice. But then you'll have 1-2% local income tax (only on earned income). No tax on retirement income of course.
Sales tax is 6% (higher in Philly), but does not apply to clothing or food currently (also some services like accounting).

Coming from New York, Pennsylvania's taxes are pretty good.  The state has a flax tax on income, and you should be able to look up local taxes for areas you're interested in ahead of time.  Property taxes will be your variable, but if you plan on renting then it's not a worry.  529 contributions (it does not have to be a PA plan) are state tax deductible up to 14k or 28k (if married filed jointly) per beneficiary per year.  Best of luck with your decision!
Right, but OP is coming from Maryland, so it is something to watch out for.

stein79

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Re: Any Pennsylvanian staches?
« Reply #5 on: February 17, 2017, 08:37:45 AM »
Thanks for the input.
The GF and I spent a few hours discussing and looking last night.  With her commute to Baltimore City, I think we are going to shelve the PA idea for now.

Retirement is pretty far off at this point so that benefit isn't worth consideration at this point.

stein79

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Re: Any Pennsylvanian staches?
« Reply #6 on: February 20, 2017, 08:28:21 AM »
Thanks for the input.

The GF and I spent a few hours discussing and looking last night.  With her commute to Baltimore City, I think we are going to shelve the PA idea for now.

Retirement is pretty far off at this point so that benefit isn't worth consideration at this point.

So, after a fruitless weekend of looking in MD, we're back to considering southern PA.  I did find out that PA and MD have reciprocal agreements (so no double taxation).

I also found a calculator on the state page that shows all the municipal and school taxes.  Apparently houses west of the highway in one township have a 1.846% tax while houses on the east side have a 2.225% tax.  So, roughly $200 difference in taxes/month for a $300k house.

Time to keep digging.

nottoolatetostart

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Re: Any Pennsylvanian staches?
« Reply #7 on: February 21, 2017, 03:21:40 AM »
Some townships may have per capita taxes. In the last borough we lived in, it was 9.90 each for DH and me (I was working then so did not pay attention to whether that is income depedent or not)...in both March and August. In our new one, it is 240 for each person earning (the term earning is key here) over 10k per year in both August and March or it also does not apply if you are 65 or older. In retirement, this won't affect us, but just in case that weighs in. The IRS is very clear too that per capita taxes are non-deductible too.