Tax friendly states

an excellent post as to relevancy of the proposed "advantages'. one article on retirement locations listed job opportunities (not interested) and cultural advantages, (of minimal interest).
texas also had a high property tax and additional MUD taxes, of lesser importance to a full timer. I figured the savings on income tax about balanced out with the increase of property tax.
bumpy

Since we all have different retirement and income situations, the Kiplinger site is very useful for starting to understand how our particular situation might play out in a specific state in terms of income and sales taxes. For full-timers, the property tax (homeowners') is not so useful. What the site doesn't address is tax and registration on rolling stock. For example... Kiplinger lists South Carolina (where we currently live) as one of the more tax-friendly states. We find SC to be rather brutal from a tax point of view. I say this because of the taxes and fees on our truck and travel trailer. When I paid taxes and renewed the tags on our 2013 2500HD diesel this past year, the bill was $1,200. The cost for the travel trailer was $300. When we change our domicile to Texas, it will cost us about $70 per vehicle to register and title and less than that each after. Texas can have high sales taxes, but if we're traveling much of the time, we won't be buying our groceries and supplies in Texas...

C-Bears said - "Southern Illinois has some wonderful scenic areas . . . . ."

This is absolutely true. The Rend Lake area is terrific as is the entire area south of there as you approach the Ohio River.

Tim

C-Bears wrote:

I am not saying that everyone that is retired should start using Illinois as their address. Actually, if you are full time and not retired it is probably the last state you would want to be from for tax purposes. .

my BIL lived in the Peoria area for several years. had nothing good to say about taxation in IL. hated it.
bumpy

BarbaraOK wrote:
How are you judging 'most' popular. Escapees has about 15,000 mail customers - I don't really think any of the mail services in SD come close to that. Illinois doesn't have a mail service that is primarily for RVers, I have no idea how voting and jury duty is handled for fulltimers in Illinois - that is another problem that people run into trying to fulltime out of different states. Are you saying that Illinois doesn't tax any retirement income, like withdrawals from IRA/401k/403b and other pension payouts, or is it they just don't tax SS payments?

Barb

No state income tax on defined contribution pension plans, or SS security, or as far as I know on 401K. They do have a regular state income tax on earned income. What we were told at the DMV reference our Driver's License and registration address was that it had to be a physical address, they would not take a P.O. box address. Mail Box Express will give you an address that has a number you can use as an apartment or suite number, otherwise it is a physical address. Voting is not problem because they are very liberal for absentee, but that is also how they call folks in for jury duty. For jury duty we have simply told them we are full time travelers and they quit calling us. Compared to insurance rates friends are paying, Illinois is cheaper for auto and health insurance in most cases than Florida.

I am not saying that everyone that is retired should start using Illinois as their address. Actually, if you are full time and not retired it is probably the last state you would want to be from for tax purposes. But since it is centrally located in the U.S., favorable for some issues as a retired full timer, then maybe it should be considered by some. There is much more to Illinois than that little section in the northern part called Chicago. Southern Illinois has some wonderful scenic areas and a cheaper cost of living than many places.

C-Bears wrote:
You can use an address from Mail Box Express for your driver's license and registration. Illinois never really is considered when full timers are looking for that "traveling address".

Does IL allow you to vote absentee using the Mail Box Express address? Does IL consider the Mail Box Express address your legal domicile? Do IL health insurance, auto insurance and RV insurance carriers consider the Mail Box Express address your legal domicile?

Will you own a home or real property in IL after going full-time? It can be difficult to 'move out' of a state if a full-timer retains a home. Especially if they don't turn it into an investment property.

There is a lot more to choosing a legal domicile than taxes/ tax rates.

C-Bears wrote:
SD is probably the most popular because of all of the above plus they have some larger mail forwarding options.

SD is losing favor very quickly with full-timers under age 65 - because of restrictions on health insurance coverage. SD has such a small population that finding health insurance which is 'nationwide' in coverage is extremely difficult.

How are you judging 'most' popular. Escapees has about 15,000 mail customers - I don't really think any of the mail services in SD come close to that. Illinois doesn't have a mail service that is primarily for RVers, I have no idea how voting and jury duty is handled for fulltimers in Illinois - that is another problem that people run into trying to fulltime out of different states. Are you saying that Illinois doesn't tax any retirement income, like withdrawals from IRA/401k/403b and other pension payouts, or is it they just don't tax SS payments?

Barb

BarbaraOK wrote:
trailertraveler,

I agree with all of the factors you listed, but the thread specifically deals with 'tax friendly states
and for fulltimers, I think you would agree that the ones that are tax-friendly and fulltime rver-friendly are FL, SD, & Tx.

Barb

After reading the original post I guess I wouldn't agree with that. I thought we were leaning toward a discussion on tax friendly/retired/RVers. Illinois does not charge state income tax on retirement income and my registration for my FW costs $50.00 a year. You can use an address from Mail Box Express for your driver's license and registration. Illinois never really is considered when full timers are looking for that "traveling address".

SD is probably the most popular because of all of the above plus they have some larger mail forwarding options.

trailertraveler,

I agree with all of the factors you listed, but the thread specifically deals with 'tax friendly states
and for fulltimers, I think you would agree that the ones that are tax-friendly and fulltime rver-friendly are FL, SD, & Tx.

Barb

BarbaraOK wrote:
...In fact the reason that FL, SD, TX are the favorites among fulltimers is because they have no state income tax...

This statement is overly simplistic. There are other states that have no income tax and several more that have no income tax or very little income tax for retirees. However, they do not accept or make it difficult to use a mail forwarding address as a legal address for obtaining a driver's license, vehicle registration, voter registration, etc. Other than UPS stores, they may not even have a mail forwarding service like those in FL, SD, and TX. Some individuals may also have other legal considerations such as inheritance, common law marriage, etc. that they need to consider in choosing a domicile. A lot of fultimers do own property and those that do that claim to domicile in a different state have to be aware of the laws regarding how long they can stay on their property without the state considering that their domicile/residence.