Author Topic: State income tax question  (Read 846 times)

JSMustachian

  • Stubble
  • **
  • Posts: 110
State income tax question
« on: April 26, 2019, 12:24:29 PM »
I live in a state that does not have a state income tax but may move to one in retirement.

If my income is $40,000 do I pay income tax on the full $40,000 or $40,000 minus the standard deduction?

walkwalkwalk

  • Stubble
  • **
  • Posts: 235
Re: State income tax question
« Reply #1 on: April 26, 2019, 12:31:47 PM »
Generally, yes you would subtract the standard deduction, however, not all states tax retirement income and some only tax part of it. It is very state specific.

Curmudgeon

  • 5 O'Clock Shadow
  • *
  • Posts: 41
Re: State income tax question
« Reply #2 on: April 26, 2019, 01:10:21 PM »
And each state has its own standard deduction, or (if itemizing) what you can itemize.

I'm trying to figure out where I want to move soon, and I'd really love to see a detailed state income tax calculator that would let me input how much income I have, how much is SS vs pension vs cap gains etc, and have it tell me my estimated tax for any or all states.

walkwalkwalk

  • Stubble
  • **
  • Posts: 235
Re: State income tax question
« Reply #3 on: April 26, 2019, 01:19:58 PM »
And each state has its own standard deduction, or (if itemizing) what you can itemize.

I'm trying to figure out where I want to move soon, and I'd really love to see a detailed state income tax calculator that would let me input how much income I have, how much is SS vs pension vs cap gains etc, and have it tell me my estimated tax for any or all states.
https://www.retirementliving.com/taxes-by-state

That website seems pretty good, since it includes most taxes that would be applicable in retirement. You could build a spreadsheet based on that, given different income streams, taxable purchases for sales tax, gas tax, etc. There may be one out there, but if you build one share it here.

Or you could use the case study https://forum.mrmoneymustache.com/forum-information-faqs/case-study-spreadsheet-updates/

I believe most states are pretty comprehensive, however they get suggestions of things that people find are missing sometimes.

MDM

  • Walrus Stache
  • *******
  • Posts: 9678
Re: State income tax question
« Reply #4 on: April 26, 2019, 11:21:36 PM »
Or you could use the case study https://forum.mrmoneymustache.com/forum-information-faqs/case-study-spreadsheet-updates/

I believe most states are pretty comprehensive, however they get suggestions of things that people find are missing sometimes.
See State Income Tax calculations - Crowdsourcing request for examples of the latter.

The case study spreadsheet may be good enough for a coarse screen.  If you can narrow it down to 2 states and want to know "for sure," you might try commercial tax software with two states.  List price would be ~$100.  Probably worthwhile if the taxes will have a significant impact on your decision, and you may be able to find lower pricing.

jpdx

  • Bristles
  • ***
  • Posts: 428
Re: State income tax question
« Reply #5 on: April 27, 2019, 11:37:13 PM »
Please consider that a state with a high income tax may actually offer things of great value. Just one example, where I live, we have a higher income tax but our child's medical, dental, and vision is completely covered by the state.