Source: NCPA
Not only is Texas Gov. Rick Perry right about the Texas business climate trumping New York’s, a new analysis from the National Center for Policy Analysis’ State Tax Calculator shows New York residents would profit enormously by moving to Texas.
“New York has always been known as a high tax state for businesses, but residents also save on their own taxes by moving to Texas or other states with no state income tax,” according to NCPA Senior Fellow Pamela Villarreal.
For example:
- A 40-year old single homeowner earning $100,000 a year could gain an additional $1,034 in discretionary income by moving to Texas; if saved and invested this would amount to $85,472 over her lifetime.
- A 40-year old married couple earning $250,000 a year could gain an additional $5,092 a year in discretionary income, and $421,117 over their lifetime.
- A 40-year old married couple earning $500,000 a year could gain an additional $8,928 a year in discretionary income, and $738,332 over their lifetime.
New Yorkers moving to Florida can save even more over their lifetime:
- A 40-year old single homeowner earning $100,000 a year could gain an additional $3,738 in discretionary income by moving to Florida; if saved and invested this would amount to $309,080 over her lifetime.
- A 40-year old married couple earning $250,000 a year could gain an additional $9,878 a year in discretionary income, and $816,855 over their lifetime.
- A 40-year old married couple earning $500,000 a year could gain an additional $17,577 a year in discretionary income, and nearly $1.5 million over their lifetime!
The State Tax Calculator, a free tool developed by the National Center for Policy Analysis, is a first-of-its-kind tool to help people determine just what’s at stake. The calculator computes the difference in the amount of federal and state income taxes, property taxes and sales taxes you could expect to pay over the rest of your life when you move from one state to another.
The calculator is based on the most sophisticated planning model available — developed by NCPA Senior Fellow Laurence Kotlikoff, director of the Tax Analysis Center. The model automatically makes saving and investment decisions for the household (including IRA deposits and withdrawals) in order to maximize personal consumption and smooth it out over a lifetime.