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Cost of living is real. Weather is real. Outside of a few highly nomadic ultra-high net worth types the tax advantages of moving states is just too trivial in
by jshaqaw 7y ago
Cost of living is real. Weather is real. Outside of a few highly nomadic ultra-high net worth types the tax advantages of moving states is just too trivial in absolute terms for most people to bother with. The idea that masses of people are moving for lower taxes seems like a rhetorical invention of the WSJ editorial page versus anything rooted in reality.
- driverdan 7y agoCA's income tax is very high. The effective tax rate is 7%+ for most tech workers. That's a huge amount of income to give up, especially if you're comparing to a state with no or low income tax.
- rayiner 7y ago> tax advantages of moving states is just too trivial It’s not. For a family with $85,000 a year, getting rid of state tax could mean an extra several hundred dollars a month in income.
- jayd16 7y agoYou'll spend the time and effort to move for a couple grand a year? Does that really make sense? How many years does it take to break even?
- GhettoChild 7y agoIt makes sense when you are also significantly decreasing your cost of living at the same time in addition to cutting taxes and want to purchase a home something that really isn'y possible in NYC or the bay on that income but is easily possible in a state with low cost of living.
- jayd16 7y agoCost of living, sure, but in this thread we're discussing how significant the tax aspect actually is.
- refurb 7y agoSpoken like someone who is out of touch. Yes, for a family making $85K, having an extra $3-4K in your pocket every year is a big deal.
- jayd16 7y agoHow much does it cost to move your family from California to Texas? How many days are you not getting payed? How many weeks is your SO unemployed? How long are you paying for two rents or mortgages? It just doesn't seem like $3k is a net gain to me.
- JamesBarney 7y agoI don't think people are quitting their jobs to save 3k in taxes. But when they are considering taking a job in California for 100k or in Texas for 85k it moves the needle in addition to cost of living.
- asdff 7y agoSpoken like someone who has never moved.
- dsfyu404ed 7y agoWe're talking a couple hundred a month. That's a small car payment for Christ sake. That's a huge influence on people's monthly budget and likewise a significant quality of life (from stress reduction if nothing else) improvement.
- dragonwriter 7y ago> For a family with $85,000 a year, getting rid of state tax could mean an extra several hundred dollars a month in income. It could, if you could take the $85,000/year job with you. Pay for similar skills in the lower CoL states is also notably lower, though.
- JamesBarney 7y agoWhich is accounted for by the lower CoL. I've had a couple of recruiters call me about jobs in San Francisco so I checked the CoL, and the CoL difference between San Fran and Houston is over a 100%. And companies weren't willing to pay double the rates they are here.
- dllthomas 7y agoIf you're turning a profit in Houston, and you double what you're spending, you don't need to double your pay to be turning a larger profit.
- refurb 7y agoDisagree strongly on taxes. Moving from CA to WA, could save a family making $100,000 nearly $1,000 per month.
- munificent 7y agoca.gov says state taxes for someone making $100k are $6,466.00. That's less than half your claim.
- lotsofpulp 7y agoCA governments, city and state, have more debt (unfunded defines benefit pension benefits) than WA does though, so in the future the taxes will continue rising.
- jshaqaw 7y agoNot to mention states without income tax fund themselves somehow. There are other taxes which partially offset the lack of state income tax.
- PopeDotNinja 7y agoYup. I just moved from CA to WA. It was like an instant ~10% raise of state taxes alone.
- jayd16 7y agoIt doesn't need to actually be beneficial to be a reason people do it. As you can see from the replies, there's certainly a perceived benefit.