• Read Part One

Last time we talked about some of the general items you need to review when choosing a home base state as well as vehicle registration, driver's licenses and various health insurance concerns.

This time we'll cover some of the tax ramifications that need to be considered. We'll also take a brief look at four of the favorite home base states - Florida, Texas, Tennessee and South Dakota. Finally I'll list some on-line and off-line resources to help you in your evaluation.

"Using different measures, a state's tax burden can differ substantially. For example, Mississippi is ranked 39th in terms of tax burden per capita, but is ranked 9th in terms of tax burden per $1,000 of personal income. On the other hand, New Jersey is ranked 13th in per capita tax burden, but 42nd in terms of tax burden per $1,000 of personal income."

Source: Arthur P. Hall, "State Tax Rates and 1995 Collections," Special Report No. 64, October 1996, Tax Foundation, 1250 H Street, NW, Suite 750, Washington, DC 20005, (202) 783-2760.

TAX CONSIDERATIONS:

• Does the state have a personal income tax?

• Is pension income taxed?

This is a real biggie, for obvious reasons. If you aren't retired yet, then keep it in the back of your mind for future reference. You might chose a state that does tax pension while you are still working and then change to a different state once you retire.

• What is the sales tax rate?

Some states exempt medicine, some food, some even clothes - there is no standard here. Some states tax services, including professional - this can add up quickly!

In addition, you will need to understand the impact of local sales taxes as well. The state may only be 3%, for example, but the actual tax may be as high as 8% once the local taxes are added.

• Do you own extensive personal property that could be taxed (boats, bonds, etc.)?

Watch this one - you could find yourself taxed for the computer you use in your RV-based business in addition to anything else the state considers taxable.

• What other taxes could impact you - personal property, income tax on dividends & interest, sin taxes (cigarettes, liquor, etc), luxury taxes?

Do you smoke or drink? What is the gasoline tax? Check these 'fine print' taxes carefully.

• If you own property, what is the property tax rate?

Okay, you sold you home so this doesn't apply to you. But if you plan to buy property in the state at some point, even just an RV lot, this should be a consideration.

• What is the inheritance tax rate? What is exempted?

No one wants to think about this one, but once you are deceased it's your spouse and family that will have to deal with it. You also want to be concerned with probate issues. Again, your attorney and accountant are your best information sources for your own situation.

No personal income tax Minimum 6.25% sales tax plus up to 2% local Vehicle safety inspections required Vehicle emission inspection required biennially Passenger vehicles weighing over 6,000# are assessed by weight rather than age $15 new-resident fee for auto registration

Texas Taxes
Texas Department of Transportation
Texas Regional Taxes and Rates

No personal income tax except 6% on interest & dividends Minimum 6% sales tax plus average of 2.25% local Vehicle safety inspections required in some counties - wheel tax - varies from $10-$50 Vehicle emission inspection required

Tennessee Personal Income Tax
Tennessee Taxes
Tennessee Motor Vehicle Registration
Tennessee Regional Taxes and Rates

No personal income tax Minimum 4% sales tax No vehicle safety inspection No vehicle emission inspection Motor vehicle excise tax  - 3% of purchase price at time of initial registration

SD Driver Licensing Home Page
SD Department of Revenue - Motor Vehicles
Description of Individual Taxes
SD Taxes
SD Regional Taxes and Rates

• Choosing a Home Base State
• How To Become a Real Texan booklet in Acrobat Reader
• Taxation Issues for Fulltime RVers
• Tax Issues for RVers

TAXES:

State and Local Tax Burden, 1970-2007 State Individual Income Taxes, January 2006 State Sales Tax Rates, January 2006 State Motor Fuel Excise Taxes, January 2006 State Cigarette Excise, January 2006 State Other Tobacco Products Taxes, January 2006 State Beer Taxes, January 2006 State Wine Taxes, January 2006 State Distilled Spirits Taxes, January 2006 State Income Tax Treatment of Social Security Benefits and Pension Income, 1996 State Personal Income Taxes on Pensions & Retirement Income, Tax Year 2007 Average Auto Insurance Costs by State, 1999-2003

OTHER:

• State Auto Insurance Rankings
• Census State Data Centers
• Violent Crimes Per 100-000 Population
• Find Your Spot

• America's Best Places to Retire by Richard Fox
• Where to Retire : America's Best and Most Affordable Places by John Howells
• Retirement Places Rated by David Savageau
• Places Rated Almanac by David Savageau & Geoffrey Loftus

NOTE: Facts & figures quoted in this article may not always be accurate. You should always check with the local government authority before making any decisions.  

• More Resources & Comparisons