Top 10 Most Tax Friendly States for Retirees 2023 (Best States to Retire) including top 10 retirement states and best states to retire.
As you approach retirement, or if you're already there, you may be thinking about moving to a different state to live out your golden years. If that's the case, consider moving to one of the most tax-friendly states for retirees. It can make a huge difference when you're trying to stretch out your retirement savings.
Of course, there are other things to think about if you're exploring relocation. For instance, you'll want to take climate, proximity to family and friends, access to quality health care, and a host of other important factors into account before picking a new location. But make sure you add taxes on retirees in any state you're considering to the list of primary factors. Depending on your situation, the total state and local tax burden in one of the best states to retire for taxes can be thousands of dollars less per year than in another.
If you're looking for the 10 best states to retire in for taxes, check out our video till the end. Our results are based on the estimated state and local tax burden in each state for two hypothetical retired couples with a mixture of income from wages, Social Security, traditional IRAs, Roth IRAs, private pensions, 401(k) plans, interest, dividends, and capital gains. One couple had $50,000 in total income and a $250,000 home, while the other had $100,000 in income and a $350,000 home.
All of the states on our "most tax-friendly" states for retirees list exempt Social Security benefits paid to seniors from state income taxes. Most also allow an exemption for at least a portion of our hypothetical couples' other retirement income, such as private pensions or IRA withdrawals. They tend to have low property tax rates and/or reasonable sales tax rates, too. Take a look and see for yourself why each state is considered one of the best states to retire in for taxes.
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