State Domicile Choices for Full Timers--why not WA? - Fiberglass RV


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Old 08-16-2018, 07:29 PM   #1
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State Domicile Choices for Full Timers--why not WA?

Hi Full timers!

I'm thinking heavily about fulltiming down the road in retirement. I know that the states that most often come up as choices for domicile are Texas, Florida and South Dakota because they have no state income tax and there are services that you can use to collect and scan or forward your mail.

I know another big factor in choosing a state for domicile is health insurance especially if you are under 65. For this reason I guess South Dakota is no longer a viable choice as there are few insuarance plans with nationwide coverage offered from there anymore.

But why aren't some of the other states with no state income tax like Washington, Wyoming, and Tennesee rarely mentioned as options for domicile?

Thanks,

Betsy
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Old 08-16-2018, 08:56 PM   #2
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Washington may get left off the list because of the sales tax. It wouldn't be a problem while you were traveling but it would be a significant consideration if you were to buy a new or new/used rig. If you "relocate" here from another state, you can avoid the sales tax when you transfer your title and license by showing you owned it in another state for a specific period - I think 6 months.

I'm not sure how the insurance would work, but we do have choices that vary by county, at least for Medicare coverage.
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Old 08-16-2018, 09:01 PM   #3
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I should have noted that Nevada and Alaska are two other states with no income tax. Tennessee taxes only dividends and interest.

I have just always been surprised that usually only TX, FL and SD are mentioned as possibilities. Wondered if WA state does not have mail forwarding/domicile services? Or perhaps makes it more difficult to choose them if they are going to tax your car and rig? Or is it availability of health insurance with nationwide coverage?

Thanks for any and all replies. . .
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Old 08-16-2018, 11:46 PM   #4
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Lets look at Oregon versus Washington as an example. It is not as simple as avoiding a domicile because they have a state income tax. These things are not as straightforward as you would like them to be. It requires a balance sheet. If you know how to use a spreadsheet program that might help you sort things out for a definitive answer.

Oregon has a state income tax but does not have sales tax
Washington has no state income tax but it does have high sales taxes including high taxes on fuel.

License tabs cost less in Oregon.

Do the math, and remember the end result is dependent on your income level. If your income is so low you don't have to pay income tax then a state income tax is irrelevant in your choice of domicile. A lot of full time boondockers out on the road are over 65 and have limited income and get that over 65 break on income taxes. So state income tax is not one of their limiting factors in choosing a state to domecile in.


You are the only person who can get a personalized quote on the cost of health care no matter what state you are interested in. For that you need to contact agents and answer their questions.
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Old 08-17-2018, 12:05 AM   #5
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Yup. There's no escaping death and taxes.
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Old 08-17-2018, 05:56 AM   #6
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look into Escapees for domicile and mail forwarding and other benefits. Norm should be along eventually with info on that group.
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Old 08-17-2018, 10:30 AM   #7
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Why is state income tax a major concern for those in retirement? I'm retired and my income is -0-. My state income tax in -0-. I'm more concerned with cost of groceries, gasoline, housing, sales and property taxes, car licensing fees, cost of living, etc. Why move to a location with extreme heat or cold and spend a fortune on utilities? Wouldn't you consider climate, crime, scenery, health care services, cost and availability of activities, and the friendliness of the neighbors when selecting a location? Shouldn't your happiness and feeling good take top priority?
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Old 08-17-2018, 10:37 AM   #8
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Consider public transportation for when you can no longer drive and have dozens of doctor appointments.
My mother is 90 years old and spends as much as $30 a day for cabs to the hospital to visit my dad in long term care.

It's going to happen.
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Old 08-17-2018, 10:42 AM   #9
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Good point!
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Old 08-17-2018, 01:29 PM   #10
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I agree about climate as merely one of the many reasons to prefer one area to another. Washington and Oregon, while the average temperatures are mild, have some extremes in winter and summer both. Eastern Washington and Oregon have some large cities (not too large) but heat and cold, drought and wind are issues if you're used to something more clement. Western Oregon and Washington make a lot of jokes about not wearing out but rusting out for a reason. Our rainy seasons are long, gray, and cool-to-cold. If you are from England, I understand you know what our weather can be like. "The Great NorthWet" saying doesn't apply in the summers here, but it sure does over the winters.

We have volcanoes (some live if slightly dormant for now), tsunamis, earthquakes, terrible congestion in our big cities like Seattle (Bellevue, just east of Seattle, at one time was said to have the worst traffic in America).

So you see...we're pretty happy here without a big influx of more people. We're crappy! Stay out! There you go.


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Old 08-17-2018, 02:07 PM   #11
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Summers in Western Oregon and Washington are a delight! However, most of the year consists of rain, snow, sleet, freezing rain, and about-to-rain. Lots of grey days and little sun.

Kiplinger ranked the states in order of best to worst in regards to retirement.

https://www.kiplinger.com/slideshow/...018/index.html

BEST: (1) South Dakota (2) Hawaii (3) Georgia (4) North Dakota (5) Tennessee (6) Alabama (7) Virginia (8) Florida (9) New Hampshire (10) Utah (11) Idaho (12) South Carolina (13) Iowa (14) Pennsylvania (15) Delaware (16) Washington (17) Wyoming (18) Colorado (19) Ohio (20) Missouri (21) Nebraska (22) Maine (23) Arkansas (24) Texas (25) Nevada (26) Oklahoma (27) Arizona (28) North Carolina (29) Mississippi (30) Kansas (31) Alaska (32) Oregon (33) Minnesota (34) Kentucky (35) Michigan (36) Montana (37) West Virginia (38) Indiana (39) New Mexico (40) Vermont (41) Wisconsin (42) Louisiana (43) Illinois (44) Rhode Island (45) California (46) Connecticut (47) New Jersey (48) Maryland (49) Massachusetts (50) New York

"... we ranked all 50 states based on financial factors critical to retirees, including living expenses, tax burdens, health care costs, household incomes, poverty rates and the economic wellness of the state itself. "

Please direct all complaints and disagreements to Kiplinger's. Thank you!
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Old 08-17-2018, 02:30 PM   #12
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I'd expect a huge influx of retirees to North and South Dakota. Best not go if you don't like crowds.
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Old 08-17-2018, 06:19 PM   #13
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Originally Posted by mchalewj View Post
Why is state income tax a major concern for those in retirement? I'm retired and my income is -0-. My state income tax in -0-.
is it? huh. my retirement funds are all in 401k/sep-ira and will be taxable upon withdrawing. I just retired in December, and haven't touched my retirement funds yet as I've been living on my severance bonus and don't WANT any more income this year.
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Old 08-17-2018, 07:02 PM   #14
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Originally Posted by John in Santa Cruz View Post
is it? huh. my retirement funds are all in 401k/sep-ira and will be taxable upon withdrawing. I just retired in December, and haven't touched my retirement funds yet as I've been living on my severance bonus and don't WANT any more income this year.
Yeah I noticed that also.. Pensions, 401K, 457, Social Security, interest on accounts, etc... it is ALL taxed for most people in most jurisdictions (at least by the feds).

I have to wonder how you pay the bills with none of those income sources.

You can defer some of those for some time, but for most retirement accounts there is the required minimum distribution requirement starting at age 70.5 and then they are taxed.

And, in many areas, there are some exemptions for senior citizens, land owners, governmental employees, etc.. Those are important financial considerations when deciding on "State Domicile Choices for Full Timers."

I receive a nice tax break as as governmental retiree in North Carolina, and it does add weight to the decision to stay here. Suffice it to say that any state that does not have an income tax would be just as financially advantageous, if all other things were equal. But all other factors are not equal. Sales tax, property tax and other aspects of the cost of living come into play also.

Each person's situation is uniquely individual.
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Old 08-17-2018, 10:25 PM   #15
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I should have noted that Nevada and Alaska are two other states with no income tax. Tennessee taxes only dividends and interest.

I have just always been surprised that usually only TX, FL and SD are mentioned as possibilities. Wondered if WA state does not have mail forwarding/domicile services? Or perhaps makes it more difficult to choose them if they are going to tax your car and rig? Or is it availability of health insurance with nationwide coverage?

Thanks for any and all replies. . .
I am in Seattle at present. We have quite a number of mail forwarding services in the city. Don't forget that there are thousands of boats here and a lot of those people go on long cruises to all kinds of places. Plus there are the fishing boats that go up to Alaska for quite a few months, crew members who work on charter and cargo boats. Persons who work for companies that send them on temporary assignments, traveling nurses, various types of consultants, etc. It is not just people in the RV community who need mail forwarding.
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Old 08-17-2018, 11:08 PM   #16
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Yeah I noticed that also.. Pensions, 401K, 457, Social Security, interest on accounts, etc... it is ALL taxed for most people in most jurisdictions (at least by the feds).

I have to wonder how you pay the bills with none of those income sources.
.......
Each person's situation is uniquely individual.
You are wrong, in what you said, in that social security is not always taxed for seniors. It depends on your income level. You can still have other income and not pay income tax on it either. I suggest you take the time to read the tax rules. They are too complex to explain here.
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Old 08-18-2018, 05:53 AM   #17
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You are wrong, in what you said, in that social security is not always taxed for seniors. It depends on your income level. You can still have other income and not pay income tax on it either. I suggest you take the time to read the tax rules. ...
No, you are wrong. I suggest you read what I what I wrote. I said it is taxed for most people, not that is is always taxed. And if you read past the first sentence in my post you will see that I said the same thing you did about having income that is not taxed.

I know full well well that many seniors do not have to pay tax on their social security income. I do the tax returns for one relative who's SS income is 100% exempt from income tax (because it is the sole income source). But the point is that Social Security income is taxable income unless the recipient qualities for one or more exemptions.
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Old 08-18-2018, 07:27 AM   #18
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Deleted as irrelevant, sorry.
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Old 08-18-2018, 08:11 AM   #19
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This thread is not about where to maintain a permanent residence, but about where a full-time RV dweller can maintain "domicile," basically an address for mail, tax, voting, and vehicle licensing purposes.

Climate is irrelevant.
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Old 08-18-2018, 04:33 PM   #20
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Jon in AZ.

They want a "base" of operations, not a place to park for months at a time. Thanks. Cleared that up for me. Climate WOULD be irrelevant, wouldn't it? I suppose William first mentioned climate...which threw me off, but that's my fault.

Before that it was all finances.

I always thought you'd use your original, "home" location as your base, since you'd be most familiar with the rules, laws, taxes, insurances, etc.. But that's just me.

Interesting topic.

What would it be like, I wonder, to cut all physical ties and take off? Many here have done it; to me it feels like a fantasy life. If you decided to settle again, you could choose--anywhere!

Kai
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