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Text Box: income. Property Taxes and Estate Taxes: Property taxes are the main source of revenue for local government. Most states give residents over a certain age some break on property taxes. About 40 states provide either property tax credits or homestead exemptions that limit the value of assessed property subject to taxes. Most forms of tax relief on property are limited to low– income households, but many are based upon age alone, including measures adopted in Alabama, Alaska, Illinois, and

Text Box: States That Want You (and your taxes)

Text Box: If you think you will save money by moving to a state that does not impose an income tax, think again. States raise revenue in many different ways besides taxing income. When a states other taxes are added in, the savings you expected may disappear. In fact, higher sales and property tax can more than offset the absence of a state income tax. Seven states—Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming, don’t levy a personal income tax. (New Hampshire and Tennessee tax only interest and dividends.) To find out what your total tax burden would be you will also need to check sales taxes, excise taxes, licensing taxes, property taxes, estate taxes, and inheritance taxes. For example, Florida has low state taxes and no income taxes, but wealthy residents pay an annual tax on “intangible assets” such as stocks and mutual funds. An individual filer will owe $1 in tax on every 1000 of intangible assets over $250,000, For a couple the threshold is $500,000.

Text Box: Taxes on Retirement Income: Currently 26 of the 41 states with income taxes don't tax social security. The states that tax social security are Colorado, Connecticut, Iowa, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, North Dakota, Rhode Island, Utah, Vermont, West Virginia and Wisconsin. States also vary in how they treat pension income of private companies, the military, federal and civil service, and state and local governments. By law, states cannot tax the benefits of U.S. military retirees if they exempt the pensions of state and local government retirees. Only Illinois, Mississippi, and Pennsylvania exempt all public and private pensions from taxes. If you are still contributing to your retirement plan keep in mind that New Jersey, Massachusetts, and Pennsylvania won’t let you deduct IRA contributions. California, Connecticut, Nebraska, Rhode Island, and Vermont offer no exemption or tax credits for pensions and other retirement

Text Box: alternatives, 401K, stock options, cash value of life insurance, home equity value. A lot of people know about net worth but really haven’t performed the exercise for themselves. Consider refinancing your home to reduce your monthly payments, and establishing a home equity line of credit for emergencies. (This is much

Text Box: It is a big mistake to assume that the future financial issues will take care of themselves just because you are contributing to your 401K, have a company pension plan and health plan that will continue. Whether we are following our dreams, or trying to survive the next layoff, the transition to retirement can be eased with planning, flexibility, and discipline.

Text Box: Most important is to take a hard look at your finances and start to make the adjustments necessary as soon as a change appears possible. Don’t panic, but don’t let your self slip into denial either. The first step in any retirement planning is to identify and understand all of your assets and options, including such things as pension fund

Your Retirement Stash “How long will it last?”	2
Driving Tax Reform: The Alternative Minimum Tax (AMT)	2