Taxes Are A Drag
Although there are many reasons we are fortunate to live in Colorado, one of those you probably don’t think about is state taxes. We’re actually the 6th best/lowest states for taxes, not including the states that don’t have any state tax.
Don’t allow this fact to lull you into a sense of happiness and bliss.
The article below provides the marginal, or highest tax rate, for every state that has state income tax. It also shares which states don’t have any state income tax. The lowest are the seven states that don’t have a state income tax. Those states are Arkansas, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. There are five states with a 9.85% or higher maximum tax rate, with California leading the way with a maximum 13.3%. California is followed by New Jersey, Hawaii, Oregon and Minnesota.
Three states – Florida, Nevada and Texas – are in danger of the necessity of instituting a state income tax with all the additional benefits they are required to provide with their dramatic increases in population.
Where will all these states find the revenue that they will need in the future? Will it be from people who don’t have money or people who do? Being the 6th lowest state, will we see future increases?
If we have not talked yet about how to create a tax free retirement and what that means for your portfolio, we need to schedule a conversation to look at your individual options.
When government needs more money in the future, will they get that money from the 90% of Americans who don’t have any money or the 10% who do? You’ll be surprised that the dividing line is only $200,000. To be in the top 10% you only need $200,000 or more. Not only will they take it from you, they’ll take it from your children and grandchildren. If you’re not careful you are building a legacy for the Internal Revenue Service and the government rather than your family.
See more in this Fool article, What Are the Highest Income Tax Rates by State?
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