Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
New Member
posted Aug 20, 2021 4:26:15 AM

Are there tax advantages between retiring in Florida or Georgia?

My mom is trying to decide. She has decent pension income and an annuity account but little property, debt or spending.

0 2 433
2 Replies
Level 15
Aug 20, 2021 5:21:18 AM

From a tax standpoint only -

 

Florida does not have a personal income tax.  But they make up for that by having higher state sales taxes and higher property taxes.

 

Georgia does have a personal income tax.  But there is a Retirement Income Exclusion for those age 62 or older on the state tax return.

 Georgia allows taxpayers age 62-64 to exclude up to $35,000 of retirement income on their tax return.  Taxpayers age 65 or older can exclude up to $65,000 of their retirement income on their tax return. Both the taxpayer and the spouse can qualify for the exemption. However, each must qualify individually.

Level 15
Aug 20, 2021 8:03:24 AM

Both states are good states for retirees, all things considered.

 

As @DoninGA mentioned, Georgia allows an exclusion on some retirement income while Florida does not impose a tax on income whatsoever.

 

Georgia has a state sales tax of 4% while Florida has a state sales tax of 6%, but those rates are highly deceptive. Florida permits local jurisdictions to collect up to an additional 1.5% in sales tax while Georgia allows local jurisdictions to collect up to an additional 4% in sales tax. As a result, the average sales tax in Georgia is around 7.5% (with the highest rate being 8%) while the average sales tax in Florida is around 7% (with the highest rate being 7.5%).

 

Real estate taxes are virtually entirely dependent upon precisely where in the state one owns such property, as well as whether or not the owner qualifies for some sort of homestead exemption. In some municipalities in Florida, total real estate taxes are in the 1.5% range (based upon fair market value) while in other, mostly unincorporated, areas that total can be in the 1% range. 

 

Your mom should probably choose a location she prefers based on criteria other than taxes if choosing between these two states.