Seven U.S. states without income tax - may have other taxes
Some things you may want to consider before hitching up the trailer
The good news: there are seven U.S. states with no income tax. The bad news: These seven states raise funds in myriad other ways, such as property and local taxes. Below is a list of the seven states, and the things you need to consider before picking up and moving to them.
The home of Mount Rushmore, South Dakota funds itself through four percent sales and use tax, a $0.22-per-gallon gas tax, and fees on vehicles, but has no corporate income tax.
4. South Dakota
Going through the states without income tax, there are numerous things to be addressed by the individual or family that plans on moving there. The data below was compiled by the Tax Foundation, which has been collecting data on taxes since 1937.
1. Alaska. This state, known for its pristine environment and wildlife, Alaska funds itself with royalties from oil and gas production as well as a 9.4 percent corporate income tax rate. Oil and gas royalties made up 83 percent of the state's revenue last year. Oil and gas corporate income taxes make up less than eight percent of revenue. Another plus: Those 65 and over should note that Alaska exempts senior citizens from the first $150,000 of assessed value for property taxes.
2. Florida. Known for its fair weather and tourism, Florida funds itself with a six percent sales tax as well as a 5.5 percent corporate income tax. The sales tax made up 73 percent of the state's revenue in fiscal year 2011-2012, with the corporate income tax making up 8.3 percent.
3. Nevada. Best known - and notorious, as the place of "Lost Wages," or Las Vegas, Nevada funds itself through a 6.85 percent sales tax. Nevada has no corporate income tax, which has helped it attract tech companies and start-ups from high-tax California.
4. South Dakota. The home of Mount Rushmore, South Dakota funds itself through four percent sales and use tax, a $0.22-per-gallon gas tax, and fees on vehicles, but has no corporate income tax. The sales and use tax made up 65 percent of the state's revenue, motor fuel tax made up 8 percent, and car titles and registration fees made up another 8 percent last year.
5. Texas. Texas funds itself through a 6.25 percent sales tax, taxes on motor vehicle sales and fuel, a 0.5 percent- one percent franchise tax, and taxes on oil and natural gas production. Sales tax made up 39 percent of the state's revenue, motor vehicle sales and fuel taxes made up 10.8 percent, franchise taxes made up 7.3 percent, and taxes on oil and natural gas made up 5.8 percent in 2012.
6. Washington. Benefitting from being surrounded by Idaho and Oregon, both of which have corporate income tax rates above seven percent and individual income tax rates above seven percent, sales tax made up 64.7 percent of revenue in Washington of 2012. Gross receipts tax contributed 17.6 percent.
7. Wyoming funds itself through a four percent sales tax, taxes on natural resources production, as well as property taxes, which for residential property is 9.5 percent. Most of the state's revenue comes from its natural resource production and property taxes on resource owners.
If you are living off interest and dividends, moving to these states are highly attractive. Just remember about the inevitability of death, and taxes - you will be paying somewhere, somehow at sometime.
© 2013, Distributed by NEWS CONSORTIUM.
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