Off The Grid Places To Live: Five States With The Lowest Taxes

Off The Grid Places To Live: Five States With The Lowest Taxes is republished from http://www.totalsurvival.net/

Is your state’s tax rate ranked in the top 5?

Residents of Wyoming pay the least taxes in the United States, while New Yorkers pay the most. That’s the conclusion of a recent study by the Tax Foundation which ranked the 10 best and 10 worst states for taxes.

The study proved what many of us probably already know: Residents of the Northeast are overtaxed while residents of certain Western states pay fewer taxes. But there are several surprises in the study. Vermont, for instance, is one of the most taxed states in the nation and Texas no longer appears on the list of the least taxed states. North Carolina also made the most-taxed list.

The list does not take license fees and other government charges — which can be very high in some states — into account.

It should be noted, however, that the list only accounts for state taxes; it doesn’t account for local taxes (in some states local governments actually collect an income tax) or federal taxes.

The 5 States With The Highest Tax Rate

1. New York State

Residents of the Empire state pay a top tax rate of 8.82 percent, a 4 percent state sales tax and an average of $2,280 a year in property taxes. It is actually worse in the Big Apple, where the New York City government charges a 3.876 percent income tax on top of state and federal levies, a 4 percent unincorporated business tax on self-employed people and a corporation tax of 8.85 percent.

2. New Jersey

New Yorkers who cross the bridge to the Garden State won’t get much of a break. The top income tax rate in Jersey is 8.97 percent and the sales tax is 7 percent. New Jersey now has the highest average property tax in the nation of $7,885 for the average household. If that wasn’t bad enough, the economic recovery means that most of the state’s residents no longer qualify for a property tax rebate program.

3. California

The Golden State has one of the highest state income tax rates in the nation at a top rate of 13.3 percent and a state sales tax of 7.5 percent. To add insult to injury, there’s also an alternative minimum tax on individuals and corporations.

4. Minnesota

This state has a top income tax rate of 7.85 percent, a sales tax of 6.875 percent and a property tax average of $1,412. It also passed a retroactive individual income tax hike on earners making more than $150,000.

5. Rhode Island

The Ocean State has a top income tax rate of 5.99 percent and a sales tax of 7 percent. It also has an average property rate of $2,083. It was named the “least tax-friendly state in the country for retirees by Kiplinger Magazine, thanks to its practice of taxing Social Security benefits, pension income, and almost all other sources of retirement income,” according to Fiscal Times.

Vermont, North Carolina, Wisconsin, Connecticut and Maryland rounded out the Top 10 of most-taxed states.

The 5 States With The Lowest Tax Rate

1. Wyoming

The Cowboy State has no income tax and a state sales tax rate of 4 percent. It is one of the few states with no corporate taxes. Instead, levies on oil, gas and mineral rights finance the state’s government. Wyoming is also the state in the second best fiscal shape according to George Mason University. It does have an average property tax rate of $2,633.

2. South Dakota

This state has no income tax, no corporate income tax and a low sales tax on purchases by individuals. South Dakota is distinguished by a high sales tax on business purchases and a tax on investments such as stocks and bonds.

3. Nevada

A complete lack of income taxes makes up for high property and sales taxes. In the Silver State the sales tax rate is 6.85 percent. It should be noted that residents of Nevada are not highly taxed, but visitors are. In addition to gambling, sales and hotel room taxes, visitors to Las Vegas even pay a live entertainment tax on shows at the city’s casinos.

4. Alaska

Residents of the nation’s largest state pay no state income or sales tax, although some local governments do collect a 1.79 percent sales tax. Alaska was in the best fiscal shape of all the states. The reason Alaska has no state income or sales tax is all the revenue from taxes on mining and oil. Alaska is the only state government that regularly gives money back to its residents — around $900 for each resident which is financed by taxes on oil and minerals.

5. Florida

Part of the reason why the Sunshine State is a retirement mecca is that it has no state income tax. There is a 6 percent state sales tax and high property taxes. Florida currently has a $1 billion budget surplus so the state legislature is one of the few in the nation looking into reducing taxes.

Washington state, Montana, New Hampshire, Utah and Indiana filled slots 6-10 in the ranking of least-taxed states.

Americans looking to avoid taxes have a number of places to consider.

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