When thinking about moving to another city or state most people take the time to research such things as schools, transportation, crime, cultural and recreational activities.
But one of the most important things many people overlook: Taxes.
State and local taxes can vary widely and some are more tax friendly than others, according to personal finance magazine Kiplinger.
“As Congress mulls a new federal tax plan that may cut rates and eliminate deductions, Americans should also keep an eye on state and local taxes,” Kiplinger managing editor Robert Long said in a statement. “Depending on where you’re living, state income taxes and property taxes cost thousands of dollars every year.”
Kiplinger examined all 50 states and ranked each state by how tax friendly they are. The study looked at each state’s income taxes, sales taxes, gas taxes, ‘sin’ taxes (tobacco, alcohol) and other tax rules and exemptions.
In this year’s list, the magazine crowns Wyoming as the most tax-friendly state for a second straight year. Wyoming has no state income or estate tax and relatively low sales and gas tax, according to the report. Here are Kiplinger’s top 10 most tax-friendly states for 2017 and how they ranked a year ago:
1. Wyoming (1)
2. Alaska (2)
3. South Dakota (8)
4. Florida (3)
5. Nevada (4)
6. North Dakota (unranked)
7. Delaware (10)
8. Arizona (5)
9. Louisiana (6)
10. Mississippi (9)
A separate report from 24/7 Wall St. found similar results with these states ranked as having the lowest taxes: 1. Alaska, 2. South Dakota, and 3. Wyoming.
Least-tax friendly states
This year, Maryland jumped to the top of the list to be named the least tax-friendly state in Kiplinger’s state-by-state guide to taxes.
The report cited the state for “some of the highest effective income taxes in the country.”
"Maryland is among a handful of states that allow localities to levy their own income taxes on top of state income taxes. When you include these taxes, the state’s effective income tax rate soars," the report said.
Kiplinger’s top 10 least tax-friendly states:
1. Maryland (unranked)
2. Minnesota (6)
3. New York (4)
4. Illinois (9)
5. Maine (7)
6. Vermont (8)
7. Hawaii (2)
8. California (1)
9. Connecticut (3)
10. New Jersey (5)
The 24/7 Wall St. analysis listed these three states as having the highest tax burdens: 1. New York, 2. Connecticut, and 3. New Jersey.
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