Retirement Living Information

Advertise
with us

Taxes in Kansas to New Mexico

Taxes by State

Please choose a State: KansasKentuckyLouisianaMaineMarylandMassachusettsMichiganMinnesota,
MississippiMissouriMontanaNebraskaNevadaNew HampshireNew JerseyNew Mexico

KANSAS

Sales Taxes

State Sales Tax: 6.3% (prescription drugs exempt); Cities and counties may add another 4%.
Gasoline Tax: 43.4 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 51.4 cents/gallon (Includes all taxes)
Cigarette Tax: 79 cents/pack of 20

Personal Income Taxes

Tax Rate Range: Low – 3.5%; High – 6.45%
Income Brackets: * Lowest – 3% for income up to $30,000; Highest – 4.9% for income over $30,000
Number of Brackets: 2 in 2013
Personal Exemptions: Single – $1,860; Married – $4,590;
Dependents – $2,250
Standard Deduction: Single – $4,500; Married filing jointly – $9,000
An additional $850 can be claimed if you are 65 years or older.  An additional $850 can also be claimed if you are blind.  If your spouse is 65 years or older, you can claim an additional $850.  An additional $850 can also be claimed if your spouse is blind.  If both you and your spouse are 65 years or older and blind, your standard deduction would be $8,800.
Medical/Dental Deduction: Federal amount. Up to $800 per contract, per taxpayer can be deducted if you have a long term care insurance contract.
Federal Income Tax Deduction: None
Retirement Income Taxes: Military, civil service, state/local government pensions are exempt.  Out-of-state government pensions are fully taxed.  Railroad retirement is fully exempt.  Social Security is exempt for residents with a federal adjusted gross income of $75,000 will be exempt from any state tax on their Social Security benefits.
Retired Military Pay: Not taxed.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Taxable property is assessed at its fair market value. Homeowners 55 and older who earn $30,800 or less are eligible for a refund of up to $700 under the Homestead Property Tax Refund Act.  You must also meet one of the following requirements: Be 55 years of age or older, or be blind or disabled, or have a dependent child under 18 who lived with you all year whom you claim as a personal exemption.  Additionally, 50 percent of Social Security benefits will be excluded from the definition of income for the purposes of qualifying for the program, resulting in additional property tax relief for seniors. A property tax refund is available for homeowners 65 or older with a household income of $17,700 or less.  The refund is 45% or the property taxes paid.  Those who claim this refund cannot claim a Homestead refund.

The effective property tax burden for renters is 15 percent of total rent.  A homeowner with a residence valued at more than $350,000 or more is prohibited from participating in the program.  Call 877-526-7738 or 785-296-2365 for property tax details or click here.

Inheritance and Estate Taxes

There are two Kansas estate acts applicable to the estates of decedents dying prior to January 1, 2010; the “pic-up” tax and the “stand-alone” estate tax. While both of these acts have been repealed they continue to apply, based on the decedent’s date of death. Both of these are now subject to “sunset” provisions which will casue these taxes to end in 2017 and 2020, respectively.

For further information, visit the www.ksrevenue.org.

KENTUCKY

Sales Taxes

State Sales Tax: 6% (food and prescription drugs, residential utilities except telephone, and medical supplies are exempt)
Gasoline Tax:  50.7 cents/gallon (Includes all taxes)
Diesel Fuel Tax:  53.7 cents/gallon (Includes all taxes)
Cigarette Tax: 60 cents/pack of 20

Personal Income Taxes

Tax Rate Range:: Low – 2.0%; High – 6.0%
Income Brackets:  Lowest – $3,000; Highest – $75,000
Number of Brackets:  6
Personal Tax Credits:  Single – $20; Married – $40; Dependents – $20; if age ;65 or older, take an additional tax credit of $40.
Standard Deduction: May either itemize deductions or take a $2,360 standard deduction.  There is no additional deduction for elderly/blind taxpayers.  The amount is adjusted annually.
Medical/Dental Deduction: The state allows a deduction of medical and dental expenses that exceed 7.5% of adjusted gross income.  You may also deduct medical and dental health insurance premiums paid with after-tax dollars.  Long-term care insurance premiums can also be deducted.
Federal Income Tax Deduction:  None
Retirement Income Taxes: Social Security, Railroad Retirement benefits, and Roth IRA proceeds are exempt.  Exclusion of up to $41,110 for military, civil service, state/local government, qualified private pensions, and annuities.  The exclusion will no longer be subject to an annual adjustment on the consumer price index after 2006.
Retired Military Pay: Not taxed. If retired after 1997, pay is subjected to tax if amount exceeds $41,110 – See Kentucy Schedule P. 
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

All real property in Kentucky is subject to state and local property tax. The state real property tax rate is 13.6 cents per each $100 of assessed value. Real property is assessed on 100% of fair market value.  To review the latest rates, click here.  Kentucky has a homestead exemption on the assessed value of a qualifying single-unit residential property which is adjusted every two years according to the cost of living index. For homeowners 65 and older or totally disabled, $34,000 of the assessed value of their property is exempt from state taxes under the homestead provision for tax year 2011 and 2012. Call 502-564-4581 for details.

Inheritance and Estate Taxes

Kentucky has an inheritance tax but all Class A beneficiaries (spouse, parent, child, grandchild, brother, and sister) are exempt.  As for the estate tax, if the total amount of the estate is less than the federal applicable exclusion, federal estate and gift tax is not due.  For more information click here.  Also click here.

For further information, visit the Kentucky Department of Revenue site or call 502-564-4581.

LOUISIANA

Sales Taxes

State Sales Tax:  4.0%; [3.8% for electricity, water utility services and steam; Interstate telecommunication services are taxable at 2%.]  Political subdivisions also levy their own sales tax that could bring the total to 10.75%.  Food for home consumption and residential utilities are exempt from state sales tax.  Drugs, wheelchairs and prosthetic devices are fully taxed.  For more information, click here.
Gasoline Tax: 38.4 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 44.4 cents/gallon (Includes all taxes)
Cigarette Tax: 36 cents/pack of 20

Personal Income Taxes

Tax Rate Range: Low – 2%; High – 6%
Income Brackets: * Lowest – $12,500; Highest – $50,000
Number of Brackets: 3
Personal Exemptions:** Single – $4,500; Married – $9,000; Dependents – $1,000; 65 and older – $1,000
Standard Deduction: Included in personal exemptions
Medical/Dental Deduction:   Federal amount
Federal Income Tax Deduction: Full
Retirement Income Taxes: Persons 65 years or older may exclude up to $6,000 of annual retirement income from their taxable income.  Taxpayers that are married filing jointly and are both age 65 or older can each exclude up to $6,000 of annual retirement income.  If only one spouse has retirement income, the exclusion is limited to $6,000.  Federal retirement benefits received by federal retirees, both military and nonmilitary, may be excluded from Louisiana taxable income.  Individuals receiving benefits from certain retirement systems (shown when you click the link) are allowed to exclude those benefits from their Louisiana tax-table income.  In addition, deferred income from the municipal and state police employee’s retirement is exempt from state income tax.  Click for details.  For more information call 225-219-0102.
Retired Military Pay: Not taxed.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Taxes are assessed and collected at the local level — 64 parishes and 7 municipal districts.  The Louisiana State Tax Commission has a regulatory role regarding property assessments.  Property assessments are based on 10% of the fair market value of the property.  Homeowners receive a homestead exemption in the amount of $7,500.  Exemption is applied against the assessed value of the home which is equal to 10% of the fair market value.  Therefore, only homes with a market value over $75,000 would be subject to the parish (county) property tax.  However, this exemption does not generally apply to municipal taxes.

A Special Assessment applies to the homestead of persons who are 65 years of age and older if the adjusted gross household income is below a certain level.  For the tax year 2006, that level was $58,531.  The level may change from year to year, so it is advisable to check with the assessor’s office to determine whether you qualify.  This special assessment will freeze the assessed value of the homestead for as long as the applicant owns and resides in the home and income does not exceed the maximum allowed.  It will be lost if improvements in excess of 25% of the home’s value are added. Call 225-925-7830 for details.

Inheritance and Estate Taxes

Effective January 1, 2008, the inheritance tax is not applicable to deaths that occur after June 30, 2004. See Acts 2008, No. 822.  Louisiana does levy an estate transfer tax.  Revised Statute 47.2436 requires that an estate transfer tax return be filed by or on behalf of the heirs or legatees in every case where estate transfer tax is due or where the value of the deceased’s net estate is $60,000.00 or more.  For more information call 225-219-7462.

For further information, visit the Louisiana Department of Revenue site or call 255-219-0102.  Additional information can be found at the Louisiana Tax Commission site and in the Louisiana Tax Fact Booklet – click here

* For joint returns, the taxes are twice the tax imposed on half the income. 
** Combined personal exemption and standard deduction.

MAINE

Sales Taxes

State Sales Tax: 5.5% (food and prescription drugs exempt)
Gasoline Tax: 49.9 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 57.1 cents/gallon (Includes all taxes)
Cigarette Tax: $2.00/pack of 20

Personal Income Taxes

Tax Rate Range: Low – 2%; High – 8.5% Maine lawmakers adopted legislation that consolidates the current personal income tax brackets and reduces the rate for the highest income bracket from 8.5% to 7.95%.  These changes are effective in 2013.
Income Brackets: * Lowest – $5,200; Highest – $20,900
Number of Brackets: 4
Personal Exemptions: Single – $2,850; Married – $5,700; Dependents – $2,850
Standard Deduction:  Single – $6,100 (2013); Married filing jointly – $10,150 (2013).
Additional Deductions for Age or Blindness:  $1,150 if married (whether filing jointly or separately) or a surviving spouse.  The additional amount is $2,200 if one spouse is 65 or over and blind, $2,300* if both spouses are 65 or over and blind, $4,600,* $1,450 if unmarried (single or head-of-household).  The additional amount is $2,900 if the individual is both 65 or over and blind.  *If married filing separately, these amounts apply only if you can claim an exemption for your spouse.
Medical/Dental Deduction:   Federal amount
Federal Income Tax Deduction:  None
Retirement Income Taxes: You and your spouse (if married) may each deduct up to $6,000 of eligible pension income that is included in your federal adjusted gross income.  Except for military pension benefits, the $6,000 cap must be reduced by any Social Security and Railroad Retirement benefits received, whether taxable or not.  Deductible pension income includes state, federal and military pension benefits, as well as retirement benefits received from employee retirement plans.  A new law amends the income tax subtraction modification for certain retirement benefits to raise the $6,000 limit to $10,000.  The subtraction modification is expanded to include all federally taxable pension income, annuity income and individual retirement account distributions, except pick-up contributions for which a deduction has been allowed.  The law applies to tax years beginning on or after January 1, 2014.
Retired Military Pay : Follows federal tax rules.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

All real estate and personal property of Maine residents is subject to local and, if authorized by the legislature, state property taxes.  Local property taxes, based upon assessed valuation, are assessed, levied and collected by municipalities.  Homestead and veteran’s exemption programs, administered by the state, are available to reduce property taxes for those who qualify.  The Homestead Exemption program provides a measure of property tax relief for certain individuals that have owned homestead property in Maine for at least 12 months and make the property they occupy on April 1st their permanent residence. Property owners receive an exemption of $10,000 on the assessed value of their home.  Click here for more information.

A Veteran exemption of $6,000 is available to those who served during a recognized war period, are 62 years or older, are receiving 100% disability as a veteran or became 100% disabled while serving.  Paraplegic veterans who received a federal grant for a specially adapted housing unit may receive a $50,000 exemption.  A blind exemption of $4,000 is available to those who are legally blind.

Maine offers a circuit breaker tax relief program for residents who pay property tax or rent. The maximum refund is $1,600. You may qualify if you do not have a spouse or dependent(s) and your 2009 household income was $64,950 or less, or you do have a spouse or dependent(s) and your 2009 household income was $86,600. In addition, your property tax had to exceed 4% of your household income or the rent you paid was 20% of your household income. Seniors do not need to meet this requirement if the household income was below $14,700 and they lived alone, or below $18,200 if they lived with a spouse or dependent. Maine Revenue Services offers a booklet on the qualifications for the senior portion of the program.  Click for details.

A senior citizen property tax credit for volunteer service is available.   A municipality may adopt an ordinance to allow resident homeowners who are at least 60 years of age to earn up to $750 in benefits by volunteering to provide services to the municipality.  The municipality may establish procedures and additional standards of eligibility for the program.  Because the volunteer benefits are not subject to Maine income tax, Maine adjusted gross income on the Maine individual income tax return may be reduced by the amount of the benefits, up to $750, to the extent included in federal adjusted gross income.  For more information on property tax relief programs, click here.  For property tax exemptions, click here.

Inheritance and Estate Taxes

There is no inheritance tax.  Maine has partially decoupled from the federal estate tax law.  The amount exempt from the Maine estate tax is different from the amount exempt from federal estate tax.  A decedent would have their estate exempt for up to $1,000,000. Click here for more information.

For further information, visit the Maine Revenue Services site or call 207-626-8475.
* For joint returns, the taxes are twice the tax imposed on half the income.

MARYLAND

Sales Taxes

State Sales Tax: 6.0% (food, prescription and non-prescription drugs exempt)
Gasoline Tax: 45.4 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 52.2 cents/gallon (Includes all taxes)
Cigarette Tax: $2.00/pack of 20

Personal Income Taxes

Tax Rate Range: Low – 2%; High – 5.5%; Maryland’s 23 counties and Baltimore City may levy an income tax ranging from 1.25% to 3.15% of taxable income.  Click here for local rates.
Income Brackets: Lowest – $1,000; Highest – $1,000,000
Number of Brackets: 7
Personal Exemptions:  Single – $3,200; Married – $6,400; Dependents – $3,200.  For more information click here.
Additional Exemptions: If you or your spouse is 65 or older or blind, you are entitled to an extra $1,000 personal exemption, in addition to the regular personal exemption that you may be entitled to.  If you have a federal adjusted gross income of up to $100,000 (up to $150,000 if filing jointly) you are entitled to a $3,200 exemption on the Maryland return for each exemption you are qualified to claim on the federal return.
Standard Deduction: $1,500 or 15% of Maryland adjusted gross income to maximum of $2,000 for single returns; $3,000 up to $4,000 for married filing jointly.
Medical/Dental Deduction: Federal amount. If you purchase a long-term care insurance contract for yourself or certain members of your family, you may be eligible for a credit of up to $500 for each insured.  To qualify for the credit, the insured must be all of the following:  A spouse, parent, stepparent, child or stepchild; A Maryland resident; Not covered by long-term care insurance before July 1, 2000.
Federal Income Tax Deduction:  None
Retirement Income Taxes: Social Security and Railroad Retirement income are not taxed.  If you are 65 or older or totally disabled (or your spouse is totally disabled), you may qualify for Maryland’s maximum pension exclusion of $27,100 under certain conditions.  If you’re eligible, you may be able to subtract some of your taxable pension and retirement annuity income from your federal adjusted gross income. Out-of-state government pensions do not qualify for the exemption.  Click here for details.
Retired Military Pay: If you are a retired member of the military, you may be able to subtract up to $5,000 of your military retirement income from your federal adjusted gross income before determining your Maryland tax. To qualify, you must have been a member of an active or reserve component of the U.S. armed forces, a member of the Maryland National guard, or you must have retired from active duty with the commissioned corps of the Public Health Service, the National Oceanic and Atmospheric Administration, or the Coast and Geodetic Survey. Click here for details.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Real property is valued at its full cash value.  Property tax rates vary widely.  No restrictions or limitations on property taxes are imposed by the state, meaning cities and counties can set tax rates at the level they deem necessary to fund governmental services.  These rates can increase, decrease or remain the same from year to year.

Homeowners’ Property Tax Credit Program allows credits against the homeowner’s property tax bill if the property taxes exceed a fixed percentage of the person’s gross income.  In other words, it sets a limit on the amount of property taxes any homeowner must pay based upon his or her income.

This plan has been in existence since 1975 when it was known as the “circuit breaker” plan for elderly homeowners.  The plan was called circuit breaker because it shut off the property tax bill at a certain point just like an electric circuit breaker shuts off the current when the circuit becomes overloaded.  The Maryland General Assembly has improved the plan through the years so that now this program is available to all homeowners regardless of their age, and the credits are given where needed based upon the person’s income.

A property tax deferral program allows property owners 65 or over to defer the increase in their property tax bill.  Local governments must approve the program.  The deferred taxes become a lien on the property and must be repaid when the property is transferred. A Renters’ Tax Credit program provides up to $750 a year for those age 60 and over or 100% disabled if they qualify on the basis of income.

For details on property taxes, click here or call 410-767-1184.

Inheritance and Estate Taxes

Maryland collects an inheritance tax.  Property passing to a spouse, child or other lineal descendent, spouse of a child or other lineal descendant, parent, grandparent or sibling, is exempt from taxation.  Property passing to other individuals is subject to a 10% tax rate.  Currently, a Maryland estate tax return must be filed if the decedent’s federal gross estate, plus adjusted taxable gifts, is $1,000,000 or greater, and the decedent was either a resident of Maryland at the time of death or a nonresident who owned real or tangible personal property in Maryland.  The tax rate is limited to 16 percent of the amount that the estate value exceeds $1,000,000.  Law changes enacted in 2006 affected the estate tax calculation, filing requirements, extension requests and interest and penalties. The estate tax is limited to federal estate tax collection.

For more information on inheritance taxes click here. For estate tax information, click here.

For further information on Maryland taxes in general, visit the Maryland Comptroller of the Treasury site.  You can also call 410-260-7980.

MASSACHUSETTS

Sales Taxes

State Sales Tax: 6.25% (food; prescription drugs; fuel costs; gas, oil, electricity; clothing costing up to $175, are exempt).
Gasoline Tax: 44.9 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 50.9 cents/gallon (Includes all taxes)
Cigarette Tax: $3.51/pack of 20

Personal Income Taxes

Tax Rate Range: Flat rate of 5.5% of federal adjusted gross income
Personal Exemptions:  Single – $4,400; Married – $8,800;
Dependents – $1,000
Standard Deduction: None
Medical/Dental Deduction: Federal amount
Federal Income Tax Deduction: None
Retirement Income Taxes: Social Security, civil service, state/local government pensions are exempt.  Pension income from other state or local governments that do not tax pension income from Massachusetts public employees is exempt from Massachusetts taxable income. Tax Tips for Seniors.
Retired MilitaryPay: Not taxed.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Massachusetts does not provide for a general homestead exemption but does have a Homestead Act.  The Homestead Act permits a homeowner who occupies a house as his/her principal residence to shield up to $500,000 in equity in that house from creditors.  By simply filing a Declaration of Homestead with the appropriate Registry of Deeds, a homeowner may be able to protect his/her residence from the claim of a future creditor.  The Homestead Act permits only one spouse to file for the equity protection if each has an ownership interest in the home.  The protection offered to the disabled and the elderly is even more comprehensive because it allows a husband and wife who own their own home to each file for the $500,000 equity protection. Click for details.

Massachusetts also has a circuit breaker program that offers a real estate tax credit for persons age 65 and older.  Certain taxpayers may be eligible to claim a refundable credit on their state income taxes for the real estate taxes paid during the tax year on the residential property they own or rent in Massachusetts that is used as their principal residence.  If the credit due the taxpayer exceeds the amount of the total income tax payable for the year by the taxpayer, the excess amount of the credit will be refunded to the taxpayer without interest.  For tax year 2012, the maximum credit allowed for both renters and homeowners is $1,000.  To be eligible for the credit for the 2012 tax year; the taxpayer or spouse, if married filing jointly, must be 65 years of age or older at the close of the 2011 tax year; the taxpayer must own or rent residential property in Massachusetts and occupy the property as his or her principal residence; the taxpayer’s “total income” cannot exceed $53,000 for a single filer who is not the head of a household, $67,000 for a head of house hold, or $80,000 for taxpayers filing jointly; and for homeowners, the assessed valuation as of January 1, 2012, before residential exemptions but after abatements, of the homeowner’s personal residence cannot exceed $705,000. Click for details.

Inheritance and Estate Taxes

There is no inheritance tax and a limited estate tax on estates valued at $1,000,000 or more.

Information for new residents can be found here.

For further information, visit the Massachusetts Department of Revenue site.

MICHIGAN

Sales Taxes

State Sales Tax: 6% (food and prescription drugs exempt; home heating fuels are taxed at 4%)
Gasoline Tax: 57.7 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 63.4 cents/gallon (Includes all taxes)
Cigarette Tax: $2.00/pack of 20

Personal Income Taxes

Tax Rate Range: Flat rate of 4.25% of federal adjusted gross income with modifications; some cities impose additional income taxes. For tax year 2013 the tax rate will be 4.25%. The rate will be reduced by 0.1% each year until the tax rate is 3.95%.  Beginning October 1, 2015, the rate is 3.9%.  Michigan has made numerous changes in its tax law which take effect in tax year 2012.  To view them, click here.
Personal Exemptions: Single – $3,950; Married – $7,900; Dependents – $2,300
Standard Deduction: None
Medical/Dental Deduction: None
Federal Income Tax Deduction:  None
Retirement Income Taxes: Social Security, military, federal, and state/local government pensions are exempt.  Private pension income is exempt up to $47,309 (individual filers) or $94,618 (married filing jointly).  These private pensions are reduced by the amount of any public pension deduction claimed.  Taxpayers 65 or older may deduct interest, dividends, and capital gains up to $20,000 (individual filers) or $40,000 (married filing jointly).  These deductions are reduced by any pension exemption taken.  Federal and Michigan public pensions are totally exempt.  Public pensions include benefits received from the federal civil service, State of Michigan public retirement systems and political subdivisions of Michigan, military retirement and Tier 2 railroad retirement.  If the conditions of the plan under step one are met, then these payments are totally exempt from Michigan income tax.  Michigan residents can treat the public pensions received from the following states as totally exempt: Alaska, Florida, Hawaii, Illinois, Massachusetts, Mississippi, Nevada, New Hampshire, Pennsylvania, South Dakota, Tennessee, Texas, Washington, and Wyoming.  Michigan residents who receive public pensions from other states are subject to the private pension exemption limits. Michigan residents who receive public pensions from states not listed above are subject to the private pension exemption limits.  Click here for FAQs.  Info for Seniors & Retirees.

Michigan recently changed how it taxes retirement benefits.  These changes are for returns filed for tax year 2012.  Click here for details.
Retired Military Pay: Not taxed. Survivor benefits are exempt if the amounts are exempt from fedral income tax or classified as military compensation or military retirement pay. Military retirement benefits that pass to the spuse of a deceased member of the military are exempt. Retirement benefits passings to other beneficiaries are taxed.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Property in Michigan is generally assessed at 50% of its true cash value. Some seniors, disabled persons, veterans, surviving spouses of veterans and farmers may be able to delay paying property taxes.  It depends on the county of residence and your income level.  If you own the home you live in, you may be exempt from a portion of local school taxes under the Homeowner’s Principal Residence Exemption Program, formerly known as the Michigan Homestead Exemption Program.  It allows homeowners an exemption from their local School Operating Millage.  In accordance with Public Act 237 of 1994, homeowners that occupy their property as their principal residence may exempt up to 18 mills.  A homestead property tax credit is available to homeowners or renters.  The credit is based on the property tax on a homestead that is subject to local property taxes or your household income.  Only those whose household income is less than $82,650 are eligible. For information on the homestead credit, call 517-334-7076. For other property tax matters, call 517-373-0500.  To view the state’s property tax estimator, click here.

Inheritance and Estate Taxes

There is no inheritance tax and a limited estate tax related to federal estate tax collection.

For further information, visit the Michigan Taxes web site. Seniors are invited to click here or call a special assistance number: 800-487-7000.

MINNESOTA

Sales Taxes

State Sales Tax: 6.875% (food, clothing, prescription and non-prescription drugs exempt); Liquor and beer have a tax at 9.375%. The sales tax rate does not apply to motor vehicles that are subject to the state excise tax on motor vehicles.  A few cities and counties also add a sales tax which can be as high as 9.0%.
Gasoline Tax: 47.0 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 53.0 cents/gallon (Includes all taxes)
Cigarette Tax: $2.83/pack of 20

Personal Income Taxes

Tax Rate Range:Low – 5.35%; High – 7.85%
Income Brackets: * Lowest – $23,100; Highest – $75,891
Number of Brackets: 3
Personal Exemptions: ** Single – $3,700; Married – $7,400; Dependents – $3,700
Standard Deduction: Single – $7,250; Married filing jointly – $10,800
Medical/Dental Deduction: Federal amount
Federal Income Tax Deduction:  None
Retirement Income Taxes: Social Security income is taxed by Minnesota to the same extent it is on your federal return.  A married couple that receives the average Social Security benefit of $22,800 and has total income from all sources of less than $43,400 is not subject to tax on any Social Security benefits, while a couple with average benefits and total income over $71,141 must include 85 percent of the Social Security, or $19,380, in taxable income.  If your only income is Social Security, you would not be required to file an income tax return.  Pensions, including federal pensions, received while a Minnesota resident are taxable by Minnesota regardless of where your pension was earned.  Railroad retirement benefits paid to you by the Railroad Retirement Board are not taxed by Minnesota.  If these benefits are included in your federal taxable income, you may subtract them from your taxable income.   Taxpayers 65 and older may subtract some income if federal adjusted gross income is under certain limits.
Retired Military Pay: Pensions are taxable.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

There is a Senior Citizen Property Tax Deferral Program that allows people 65 years of age or older, whose household incomes are $60,000 or less, to defer a portion of their property tax on their home.  This deferral program has two primary advantages for senior citizens.  It limits the maximum amount of property tax you pay to three percent of your total household income, and it provides predictability.  The amount of tax you pay will not change for as long as you participate in this program.  It is not a tax forgiveness program.  It is a low interest loan from the state.  The deferred tax is paid by the state to your county.  Interest will be charged on this loan.  The interest rate will be adjusted annually, but will never exceed five percent.  A lien will attach to your property.

Minnesota has two property tax refund programs for homeowners: the regular property tax refund, and the special property tax refund.  You may be eligible for one or both, depending on your income and the size of your property tax bill. Click for details.

Inheritance and Estate Taxes

Minnesota has an estate tax.  The estate tax is a tax on all of the assets of a decedent before they are distributed to beneficiaries.  If the estate meets the filing requirements, the estate pays this tax to the IRS and/or the state in which the decedent lived (prorated to any other states where the decedent had property).  Many states have a threshold different from the federal level.

Minnesota does not have an inheritance tax.  An inheritance tax is a tax on the beneficiaries of an estate (a tax on what you inherit).  If you are a beneficiary, you generally do not have to include inheritance on your income tax return.  However, you may have to pay income tax if you inherit an IRA/annuity, etc., which includes the decedent’s pre-tax dollars.  You should be notified by the estate if this is the case.  The income tax is owed to the state in which the beneficiary lives (not the state where the decedent lived.).

For further information, visit the Minnesota Department of Revenue site.
* The tax brackets reported are for single taxpayers. For married taxpayers filing jointly, the same rates apply to income brackets ranging from $33,770 to $131,171 (2011). A 6.4% AMT rate is also applicable.
** Minnesota allows personal exemption or standard deductions as provided in the Internal Revenue Code.

MISSISSIPPI

Sales Taxes

State Sales Tax: 7% (prescription drugs, residential utilities, motor fuel, newspapers, healthcare services, and payments made by Medicare and Medicaid are exempt).
Gasoline Tax: 37.2 cents/gallon  (Includes all taxes)
Diesel Fuel Tax: 43.2 cents/gallon (Includes all taxes)
Cigarette Tax: 68 cents/pack of 20

Personal Income Taxes

Tax Rate Range: Low – 3%; High – 5%
Income Brackets: Lowest – $5,000; Highest – $10,000
Number of Brackets: 3
Personal Exemptions:  Single – $6,000; Married – $12,000; Dependents – $1,500  Click for details.
Additional Exemption: 65 or older – $1,500
Standard Deduction: Single – $2,300; Married filing jointly – $4,600
Medical/Dental Deduction: Partial
Federal Income Tax Deduction: None
Retirement Income Taxes: Qualified retirement income is exempt from state income tax.  Social Security is not taxed, regardless of total income.  Retirement income from IRAs, 401s/403s, Keoghs and qualified public and private pension plans is not taxable.  Interest income from federal securities and obligations of Mississippi and its political subdivisions are all exempt.
Retired Military Pay: Retired pay is exempt. The exemption is also available to the spouse or other beneficiary upon the death of the primary retiree. Widows’ pensions received from the VA are not taxable.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Property and automobiles are both subject to ad valorem taxes – meaning that the tax is assessed in relationship to the value of the property.  Single family residential property is taxed at 10% of its assessed value.  All other personal property is assessed at 15% of its value.  Motor vehicles are taxed at 30% of their value.  The state offers a homestead exemption to all eligible taxpayers.  Eligible homeowners should make application with the Tax Assessor in the county where the home is located.  This application must be filed between January 1 and April 1.  The maximum exemption for regular homeowners is $300.  For homeowners 65 years of age or totally disabled, there is an exemption on the first $75,000 true value.  You do not have to apply for homestead exemption each year.  You should reapply if there were changes in your homestead status (marital, property, ownership, etc.).

For additional information, call 601-923-7631 or click here.

Inheritance and Estate Taxes

There is no inheritance tax.  An estate tax is imposed on the value of a decedent’s estate when the total gross estate exceeds the federal exemption of $1,000,000.  The exemption amount will follow the federal exclusion under 26 USC 2010.

For further information, visit the Mississippi Department of Revenue site or call 601-923-7000.

MISSOURI

Sales Taxes

State Sales Tax: 4.225% (prescription drugs exempt; food is taxed at 1.225%)  Cities and counties as well as special taxing districts (such as fire districts) may impose a local sales and use tax that may raise the total tax to about 6.625%.
Gasoline Tax: 37.5 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 41.7 cents/gallon (Includes all taxes)
Cigarette Tax: 0.17 cents/pack of 20

Personal Income Taxes

Tax Rate Range: - 1.5%; High – 6%
Income Brackets: Lowest – $1,000; Highest – $9,000 [Tax is imposed at a rate of 1-1/2 percent on the first $1,000 of taxable income and increases at a rate of 1/2 percent for every $1,000 increment up to $9,000.  The tax rate is 6 percent on Missouri taxable income exceeding $9,000.]
Number of Brackets: 10
Personal Exemptions: Single – $2,100; Married – $4,200; Dependents – $1,200; Plus $1,000 for dependent 65 or older. Taxpayers 65 or blind — $1,100 ($1,400 if single or head of household)
Standard Deduction: Single – $6,100; Married filing jointly – $12,200. Deduction increases for those age 65 and older.
Medical/Dental Deduction: Federal amount.  Individuals may subtract from their federal adjusted gross income, qualified health insurance premiums and long-term care premiums, to the extent their premiums paid were not reimbursed by their employer, or excluded from their federal adjusted gross income.
Federal Income Tax Deduction: The state allows a deduction on your individual income tax return for the amount of federal tax you paid.  The deduction is for the amount actually paid as indicated on your federal tax form.  For individual filers the amount cannot exceed $5,000.  For joint filers the ceiling is $10,000.
Retirement Income Taxes: Missouri resident taxpayers are allowed a state income tax deduction for Social Security benefits received by individuals 62 years of age or older, Social Security disability benefits, and non-private retirement system benefits received by individuals 62 years of age or older, to the extent these benefits are included in federal adjusted gross income.  To view the Social Security/Social Security Disability deduction chart and the public pension exemption eligibility chart, click here.
Public Pension Exemption: Married couples with Missouri adjusted gross income less than $100,000 and single individuals with Missouri adjusted gross income less than $85,000, may deduct up to 65 percent of their public retirement benefits, to the extent the amounts are included in their federal adjusted gross income. The deductible percentage of their public retirement benefits will increase until 2012. A breakdown of the yearly percentage is as follows: Generally, the maximum amount of benefits that can be deducted is as follows: 80% for 2011; and 100% for 2012 and thereafter. The total public pension exemption is limited to $33,703 for each spouse. Married couples with Missouri adjusted gross income greater than $100,000 and single individuals with Missouri adjusted gross income greater than $85,000, may qualify for a partial exemption. Taxpayers who also qualify for the Social Security or Social Security Disability Deduction, must reduce their public pension exemption by the amount of the social Security or social Security disability Deduction.
Retired Military Pay: The state allows 15 percent of military pension income to be exempt from Missouri state tax. This tax deduction will increase 15 percent annually until January 1, 2016, when all military pension income will be tax free.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Residential property is assessed at 19% of its fair market value.  Personal property is assessed at rates ranging from 5% to 33.3%.  The Missouri Property Tax Credit Claim gives credit to certain senior citizens and 100 percent disabled individuals for a portion of the real estate taxes or rent they have paid for the year.  The credit is for a maximum of $750 for renters and $1,100 for owners who occupied their home during the period being claimed.  The actual credit is based on the amount of real estate taxes or rent paid and total household income.

Inheritance and Estate Taxes

Since the IRS will no longer allow a state death tax credit for deaths occurring on or after January 1, 2005, no Missouri estate tax is imposed.  Therefore, no estate tax return must be filed for deaths occurring on or after January 1, 2005.

For information about moving to Missouri, click here.  For further information about state taxes, visit the Missouri Department of Revenue site.

MONTANA

Sales Taxes

State Sales Tax: No general sales tax. A 3% tax on accommodations and campgrounds is added to the 4% tax on rental vehicles.
Gasoline Tax: 46.2 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 53.0 cents/gallon (Includes all taxes)
Cigarette Tax: $1.70 cents/pack of 20

Personal Income Taxes

Tax Rate Range: - 1%; High – 6.9%
Income Brackets: Lowest – $2,600; Highest – $15,600
Number of Brackets: 7
Personal Exemptions:  Single – $2,140; Married – $4,280;
Dependents – $2,140
Additional Exemptions: 65 or older – $2,040
Standard Deduction: Single – $4,200, Married filing jointly – $8,400.
Medical/Dental Deduction: Federal amount
Federal Income Tax Deduction:  Full
Retirement Income Taxes: Montana taxes all pension and retirement income received while residing in Montana to the extent it is taxable on the federal return.  Tier I and Tier II Railroad Retirement benefits are 100% exempt from Montana income tax.  The state allows a pension and annuity income exemption of up to $3,600 per individual, if certain income limitations are met.  Early distributions from an IRA do not qualify for this exemption.  Social Security benefits taxable in Montana may be different from what is taxable federally. You will need to complete Worksheet VIII – Taxable Social Security Benefits to determine your Montana taxable social security.

Regarding interest income earned, there is a partial interest exemption for taxpayers age 65 or older.  If you are single and age 65 or older at the end of the calendar year, you can exempt up to $1,600 of the interest income that you reported in your federal adjusted gross income.  If you are married and filing a joint return with your spouse and at least one of you is age 65 or older at the end of the calendar year, you can exempt up to $1,600 of the interest income that you reported in your federal adjusted gross income.  If you are married and filing your return separately and are age 65 or older at the end of the calendar year, you can exempt up to $800 of the interest income that you reported in your federal adjusted gross income.  Please note, however, that you are not allowed to exclude interest income earned by and reported by your spouse.  For the purpose of this exclusion, when you determine the amount of your interest income, you should consider distributions commonly called dividends on deposits or share accounts as interest.  Under no circumstances can you exclude more interest income than what you have reported in your federal adjusted gross income.

Montana taxes some retirement benefits.  If you have reported taxable retirement income on the federal income tax return, you may be entitled to a partial exemption of this income.  Tier I and Tier II Railroad Retirement benefits are 100% exempt from Montana taxation.  Also, if you have received a disability pension, which is identified as a distribution code 3 on your 1099R, you should use the state’s disability pension worksheet to determine your deduction instead of the retirement income exclusion.

If you have received retirement income other that Tier II Railroad benefits, you should complete state form W, Worksheet IV in order to determine the amount of your exclusion.  Your retirement exclusion is limited to the lesser of your taxable retirement income that you received or $3,600, as long as your federal adjusted gross income is $30,000 or less and you are filing a single return, filing jointly with your spouse and only one of you have taxable retirement income, or you are filing as head of household.  If both you and your spouse have received retirement income and you are filing jointly with your spouse, and your federal adjusted gross income is $30,000 or less, you both can exclude the lesser of your taxable retirement income that you receive personally or $3,600 each for a maximum of $7,200.  If you are filing your income tax return separately on the same form, or on separate forms, the lesser of your retirement income or $3,600 applies separately to both spouses as long as your separately state federal adjusted gross income is $30,000 or less.
Retired Military Pay: See above. Survivor benefits are taxed following federal tax rules.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

All property (real or personal) is subject to state and local taxes.  The assessed valuation of real property is based on 100% of its fair market value, then reduced by a a phase-in factor and taxed as a percentage thereof.  The state established the tax rate to determine the assessed valuation while local taxing units establish the mill levies to determine the property tax.  Personal property is also taxed, the most common being motor vehicles.  All residential properties receive a 34% exemption but residents must file for the exemption. Residential property of certain disabled veterans, and the spouses of deceased veterans, is exempt from property taxation.  Montana property owners can have their property taxes reduced if they meet certain qualifications.  Any homeowner or renter age 62 or over can apply for a credit if they have lived in Montana for 9 months, occupied a residence for 6 months, and had a gross household income of less than $45,000. For a better understanding of property taxes, click here.  For more information on property tax relief programs, click here.

Inheritance and Estate Taxes

There is no inheritance tax and no estate tax.  For more information click here.

For further information, visit the Montana Department of Revenue site.  If you are thinking of moving to Montana, click here.

Note: The state has a statutory provision for automatic adjustment of tax brackets, personal exemptions or standard deductions to the rate of inflation.

NEBRASKA

Sales Taxes

State Sales Tax: 5.5% (food and prescription drugs exempt); local option taxes could add an additional 2.0% to the state rate.  For local rates, click here.
Gasoline Tax: 45.5 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 50.9 cents/gallon (Includes all taxes)
(Fuel taxes are variable and are reset on July 1 and January 1)
Cigarette Tax: 64 cents/pack of 20

Personal Income Taxes

Tax Rate Range:- 2.56%; High – 6.84%
Income Brackets: * Lowest – $2,400; Highest – $27,000
Number of Brackets: 4
Personal Tax Credits: Single – $120; Married – $240; Dependents – $120;
Standard Deduction: Single – $5,450, Married – $10,900
Medical/Dental Deduction: Federal amount
Federal Income Tax Deduction:  None
Retirement Income Taxes: Railroad Retirement benefits are exempt.  Out-of-state government pensions are fully taxed.  Social Security is taxable to the extent of federal taxation.
Retired Military Pay: Follows federal tax rules.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Real property is assessed at 100% its actual (market) value.  A property tax credit is provided for all parcels of property based on the valuation of each parcel.  The estimated credit for 2012 is $71.50 for each $100,000 in valuation. The state has a homestead exemption that provides relief from property taxes by exempting all or a portion of the valuation of the homestead from taxation.  There are three groups of exemptions: A) persons age 65, B) certain disabled individuals, and C) certain disabled veterans and their widow(er)s.  Call 800-742-7474 or 402-471-5984 for details or click here.  For information about the homestead exemption, click here.

Inheritance and Estate Taxes

Nebraska’s inheritance tax, which is collected at the county level, applies to bequests, devises, or transfers of property or any other interest in trust or otherwise having characteristics of annuities, life estates, terms for years, remainders, or reversions.  Nebraska inheritance tax is computed on the fair market value of such annuities, life estates, terms for years, remainders, and reversions. The fair market value is the present value as determined under the provisions of the Internal Revenue Code of 1954, as amended, and its applicable regulations with respect to estate tax.  The Nebraska estate tax and generation-skipping transfer tax have been repealed for decedents dying or transfers made on or after January 1,2007.

For further information, visit the Nebraska Department of Revenue site.
* The tax brackets reported are for a single individual. For married couples filing jointly, the same rates apply for income under $4,800 to over $54,000.

Note: The state has a statutory provision for automatic adjustment of tax brackets, personal exemptions or standard deductions to the rate of inflation.

NEVADA

Sales Taxes

State Sales Tax:  6.85% until June 2013 (food and prescription drugs exempt). Counties may add up to 1.25% additional.
Gasoline Tax: 51.5 cents/gallon  (Includes all taxes)
Diesel Fuel Tax: 53.0 cents/gallon (Includes all taxes)
Cigarette Tax: 80 cents/pack of 20

Personal Income Taxes

No state income tax
Retirement Income: Not taxed

Property Taxes

All property in the state is subject to tax by the state, counties, cities, towns, and school districts.  Property taxes are applied to property of every kind and nature, including real and personal property.  The assessed valuation for tax purposes is based on 35% of the fair market value of the property and is revalued every year.  Click here.  The Department of Taxation and county assessors and treasurers are required to provide information on the Internet concerning property taxes, including, a description of the assessment process, an explanation of the manner in which property taxes are calculated, the rates of taxes imposed by various taxing entities and the revenues generated by those taxes.

Inheritance and Estate Taxes

There is no inheritance tax and a limited estate tax related to federal estate tax collection.

For further information, visit the Nevada Department of Taxation site or call 866-962-3707.

NEW HAMPSHIRE

Sales Taxes

State Sales Tax: None. However, there are some specific sales taxes: 9% tax on restaurants, prepared food, hotel rooms and car rentals; 55 cents per megawatt hour on electricity, 7% on telecommunication services, plus additional taxes on real estate transfers and alcohol.
Gasoline Tax:  38.0 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 44.0 cents/gallon (Includes all taxes)
Cigarette Tax: $1.78 cents/pack of 20

Personal Income Taxes

New Hampshire depends more upon real property taxes for revenue than most states since there are no general income, sales or use taxes. The state also receives substantial revenue from taxes on motor fuels, tobacco products, alcoholic beverages sold through the state liquor stores, and pari-mutuel betting. The state income tax is limited to a 5% tax on dividends and interest income of more than $2,400 ($4,800 for joint filers).  A $1,200 exemption is available for residents who are 65 years of age or older.  For an overview of New Hampshire taxes, click here.
Retirement Income: Not taxed.
Retired Military Pay: Not taxed.
Military Disability Retired Pay: Disability Portion – Length of Service Pay: Member on September 24, 1975 – No tax; Not Member on September 24, 1975 – Taxed, unless combat incurred.  Retired Pay – Based solely on disability.  Member on September 24, 1975 – No tax.  Not Member on September 24, 1975 – Taxed, unless all pay based on disability, and disability resulted from armed conflict, extra-hazardous service, simulate war, or an instrumentality of war.
VA Disability Dependency and Indemnity Compensation: Not subject to federal or state taxes
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Local property taxes, based upon assessed valuation, are assessed, levied and collected by municipalities.  To view the tax rates for each town, click here.

A state education property tax rate of $2.350 per $1,000 of total equalized valuation is assessed on all New Hampshire property owners.  An elderly exemption for property taxes can be age, net income limits, including Social Security income, and net asset limits.  Property taxes can be deferred but accrue interest at the rate of 5% per annum.  The deferred property tax may not exceed more than 85% of the equity value of the residence.  The deferral is available (if granted) by the assessing officials, to any resident property owner who is at least 65 years old. For single homeowners 65 and older who earn less than $5,000 and married couples who earn less than $6,000, $5,000 of their property’s assessed value is exempt from taxes.  In addition, the homeowner’s other assets besides the home must be worth less than $35,000.

There is a Low & Moderate Income Homeowner’s Property Tax Relief program in New Hampshire.  Click here.  You must own a homestead subject to the state education property tax; reside in such homestead as of April 1 of the year for which the claim for relief is made; have a total household income of (1) $20,000 or less if a single person or (2) $40,000 or less if married or head of a New Hampshire household.  For more information, click here.

Call 603-271-2687 for details on property taxes or click here  for municipal tax rates.

Inheritance and Estate Taxes

New Hampshire’s Legacy & Succession Tax was repealed in 2002 and is effective for deaths occurring on or after January 1, 2003. As a result there is no inheritance or estate tax.

For further information, visit the New Hampshire Department of Revenue Administration site or call 603-271-2318.

NEW JERSEY

Sales Taxes

State Sales Tax: 7% (food, prescription drugs and non-prescription drugs, clothing, footwear exempt).  Local sales taxes are imposed on sales of certain items sold in Atlantic City and Cape May County.
Gasoline Tax: 32.9 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 41.9 cents/gallon (Includes all taxes)
Cigarette Tax: $2.70/pack of 20

Personal Income Taxes

Tax Rate Range: Low – 1.4%; High – 8.97%.
Income Brackets: * Lowest – $20,000; Highest – $500,000
Number of Brackets: 6
Personal Exemptions:  Single – $1,000; Married – $2,000; Dependents – $1,500
Additional Exemptions: Taxpayer or spouse 65 or older – $1,000
Standard Deduction: None
Medical/Dental Deduction: Limited to excess of 2% of gross income
Federal Income Tax Deduction:  None
Retirement Income Taxes: Pensions, annuities, and certain IRA withdrawals are taxable and must be reported on your New Jersey resident income tax return.  However, the taxable amount you show on your state return may differ from the amount that is taxable for Federal income tax purposes.  This is because you may have to calculate the taxable amount for your New Jersey return differently than you do for your Federal return. Social Security and Railroad Retirement benefits, and benefits received as a result of permanent and total disability before age 65, are not taxable and should not be reported as pension income.  However, if you retired before age 65 on a total and permanent disability pension, and you continue to receive pension payments after age 65, your disability pension is treated as ordinary pension income beginning the year you reach age 65.

For residents receiving a United States military pension or survivor’s benefit payments, the military pension or survivor’s benefit is not taxable for New Jersey gross income tax purposes, regardless of your age or disability status.  Military pensions are those resulting from service in the Army, Navy, Air Force, Marine Corps, or Coast Guard.  This exemption does not apply to civil service pensions or annuities, even if the pension or annuity is based on credit for military service.  Most military pensions and survivor’s benefit payments are received from the US Defense Finance and Accounting Service while a civil service annuity is received through the US Office of Personnel Management.

The state provides several income exclusions to enable residents to reduce their taxable income.  These exclusions can be used every year you qualify.  Persons 62 or older may use the Pension Exclusion to exclude all or part of their taxable pensions, annuities, and IRA withdrawals provided their gross income for the entire year before  subtracting any pension does not exceed $100,000.  The maximum amount excluded depends on your filing status.  If married and filing a joint return, you may exclude up to $20,000.  If you file as single, head of household, or qualifying widow or widower, you may exclude up to $15,000.  If you are married, filing a separate return, you may exclude up to $10,000.  If you file a joint return, and both you and your spouse qualify for the Pension Exclusion, you may apply the exclusion to the total taxable pension amount on your return.  However, if only one spouse is age 62 or older or disabled, then only the income of the spouse who is age 62 or older or disabled ay be excluded.

For more information on taxes due, exclusions, deductions, and exemptions, check out the tax form.  Also check out all of the income tax deductions.

Military Personnel Income Tax Information – (click here)

Retired Military Pay: Military pensions are exempt from taxes.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

Property taxation is local. To review property tax brochures, click here.

Property Tax Relief Programs (click here)
New Jersey residents who owned and occupied a home in New Jersey that was their principal residence on October 1, 2011, may be eligible for a homestead benefit provided the 2011 property taxes were paid and they meet certain income limits.  The homestead benefit application for homeowners is not included in the NJ-1040 booklet.  Information about the 2011 homestead benefit will be posted on the state site as it becomes available.

Tax Treatment of New Jersey Property Tax Benefit Payments(click here)
To calculate the correct amount of property taxes paid on their New Jersey principal residence homeowners must know whether they received a homestead benefit during 2011, the amount of the benefit, and whether the benefit was paid as a credit on their 2011 property tax bill or in the form of a check.  For tenants, 18% of the rent paid during the year is considered property taxes paid.  Qualified residents should review the instructions in the NJ 1040 booklet for determining the amount of property taxes due and paid for 2011.

The Homestead Rebate Program establishes a system of homestead credits for homeowners and residential tenants. This program previously included residential tenants. The credit program provides taxpayers with benefits calculated as a percentage of the property tax (up to a maximum of $10,000 tax) that they paid during the previous year.  The percentages used to calculate this benefit are based on income levels, with higher percentage benefits allowed for the lower income levels, and with no benefit allowed for those whose income exceeds $250,000.  The act also imposes a 4% property tax levy cap on school districts and county and local governments, subject to limited exceptions and adjustments.  The tax levy cap provisions will apply to budget years beginning on or after July 1, 2007, but not to years beginning after June 30, 2012.  The  homestead credit provisions will begin to apply to claims for rebates and credits for property tax paid for the year 2006. For more information, click here.

The Property Tax Reimbursement Program reimburses eligible senior citizens and disabled persons for property tax increases.  The amount of the reimbursement is the difference between the amount of property taxes that were due and paid in the “base year” (the first year that you met all the eligibility requirements) and the amount due and paid in the current year for which you are claiming the reimbursement, provided the amount paid in the current year was greater.  You must meet all the eligibility requirements for the base year and for each succeeding year, up to and including the current year to qualify for the reimbursement.

Property Tax Deduction/Credit is available to eligible homeowners and tenants who pay property taxes, either directly or through rent, on their principal residence in New Jersey.  They are eligible for either a deduction or a refundable credit on their New Jersey resident income tax return.  Homeowners and tenants may be eligible for a deduction or credit even if they are not eligible for a homestead rebate.  Qualified residents may deduct 100% of their property taxes due and paid or $10,000, whichever is less.  For tenants, 18% of rent paid during the year is considered property taxes paid.  The minimum  benefit is a refundable credit of $50.  Those eligible must be 65 years of age or older or blind or disabled and are not required to file a return because their income is below the minimum filing threshold. For more information, click here.

For senior citizens and disabled persons there is a $250 tax deduction from real property taxes provided for a dwelling of a qualified senior citizen.  You must be age 65 or older, or a permanently and totally disabled individual, or the unmarried surviving spouse, age 55 or more, of such person.  This benefit is administered by the local municipality.

Inheritance and Estate Taxes

New Jersey imposes a transfer inheritance tax, at graduated rates ranging from 11% to 16%, on the transfer of real and personal property having a total value of $500 or more which passes from a decedent to a beneficiary.  If a decedent’s death occurs on or after July 1, 1988, property passing to a decedent’s surviving spouse, surviving parents, grandparents, children, stepchildren or grandchildren is entirely exempt from the tax.

In addition to the inheritance tax, New Jersey imposes a separate estate tax.  An estate may be subject to the New Jersey Estate Tax even though there is no New Jersey Inheritance Tax payable.  For decedents with a date of death prior to January 1, 2002 the New Jersey Estate Tax was designed to absorb the maximum credit for state inheritance, estate, succession or legacy taxes allowable in the Federal estate tax proceeding.  It did not increase the estate’s total estate tax obligation.  For decedents with a date of death on or after January 1, 2002 the New Jersey Estate Tax was decoupled from the Federal estate tax proceeding.

The New Jersey Estate tax is based upon the Federal Estate tax credit for state death taxes which was allowable under the provisions of the Internal Revenue Code in effect on December 31, 2001.  The Federal Estate Tax does not have a provision providing a deduction for property passing to a domestic partner.

Information pertaining to the estate and inheritance tax may be obtained by calling 609-292-5033 or 609-292-5035.  You can also click here.

For further information, visit the New Jersey Department of Taxation site.
* The tax brackets reported are for a single individual. A separate schedule is provided for married households filing jointly which ranges from 1.4% under $20,000 to 8.97 for income over $500,000.

NEW MEXICO

Sales Taxes

Gross Receipts Tax: 5.125% (prescription drugs exempt); county and city taxes may add another 6.625%. Certain food and medical expenses are exempt.
Gasoline Tax: 37.3 cents/gallon (Includes all taxes)
Diesel Fuel Tax: 47.2 cents/gallon (Includes all taxes)
Cigarette Tax: $1.66/pack of 20

Personal Income Taxes

Tax Rate Range: - Low -1.7%; High – 5.3%
Income Brackets: * Lowest – $5,500; Highest – $16,000
Number of Brackets: 4
Personal Exemptions: ** Single – $3,650; Married – $7,300; Dependents – $3,650
Additional Exemptions: Taxpayer or spouse 65 or older – up to $10,900 deduction each from taxable income.  An additional tax exemption of up to $2,500 is allowed for low- and middle-income taxpayers.
Standard Deduction: (2013) Single – $6,100; Married filing jointly – $12,200  Same as federal
Medical/Dental Deduction: Credit of 3% of unreimbursed prescription drug expenses to maximum of $150 per individual or $300 per return. Also, if you or your spouse are age 65 and over and have unreimbursed or uncompensated medical care expenses of $28,000 or more for yourself, your spouse or dependents during the tax year, you are eligible for a $3,000 exemption and a credit of $2,800.
Federal Income Tax Deduction: None
Retirement Income Taxes: The state offers a low- and middle income exemption.  The maximum exemption is $2,500.  To qualify, the amount on line 7 of the state income tax form must be equal to or less than $36,667 (single), $27,500 (married filing separately), or $55,000 (married filing jointly.  A deduction also applies for those 65 and older if your adjusted gross income is not over $51,000 for a joint return, $28,500 for a single taxpayer, or $25,500 for a married taxpayer filing separately.
Retired Military Pay: See above.
Military Disability Retired Pay: Retirees who entered the military before Sept. 24, 1975, and members receiving disability retirements based on combat injuries or who could receive disability payments from the VA are covered by laws giving disability broad exemption from federal income tax. Most military retired pay based on service-related disabilities also is free from federal income tax, but there is no guarantee of total protection.
VA Disability Dependency and Indemnity Compensation: VA benefits are not taxable because they generally are for disabilities and are not subject to federal or state taxes.
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.

Property Taxes

All property, whether real or personal, is subject to state and local property taxes.  Rates vary substantially and depend on property type and location.  The statewide weighted average rates, i.e., total obligations/total net taxable value, are about $26.47 for residential property. Assessors usually determine market value by the sales-comparison approach which matches a property’s value to that of similar properties.  The valuation of a residence that did not change hands in the prior year may not increase by more than 3% annually.  One-third of the property’s market value (assessment) is its taxable value.  The taxable value may be further reduced by exemptions of $2,000 each of heads of house holds and $4,000 for veterans.

There is a property tax rebate for residents age 65 and older.  Their modified gross income cannot exceed $18,000 for the tax year and they cannot have been claimed as a dependent on another taxpayer’s return. Homeowners 65 and older who earn $18,000 ($25,000 in Sandoval County) or less are eligible for a credit of up to $250 (married filing jointly) or $125 for single taxpayers.  Call 505-827-0870 for details.

For details on property taxes, click here.  .

Inheritance and Estate Taxes

There is no inheritance tax but an inheritance may be reflected in a taxpayer’s modified gross income and taxed that way.  The estate tax is related to federal estate tax collection. It applies to the New Mexico portion of the net estate as a proportionate share of the federal credit for state estate taxes. The net estate located in New Mexico of a nonresident is also taxable as a fraction of the federal credit.

For further information, visit the New Mexico Taxation and Revenue Department site.
* The tax brackets reported are for a single individual.  For married individuals filing jointly, the same rates apply for income under $8,000 to over $24,000. Married households filing separately pay the tax imposed on half the income.
** New Mexico allows personal exemptions or standard deductions as provided in the Internal Revenue Code.

Newsletter

Subscribe to our newsletters and keep up-to-date on retirement news and new retirement communities.

Email

Send this page to a friend.  They will appreciate the information.