FLORIDA
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NICKNAME
The Sunshine State
BOTTOM LINE: TAX-FRIENDLY
Florida is very popular with retirees, not just because of its year-round sunshine but because of the lack of a state income tax. Still, sales taxes run high. Real estate is taxed at 100% of assessed value. Permanent residents are entitled to a homestead exemption of up to $50,000, regardless of age, and seniors may qualify for an additional exemption.
STATE SALES TAX
6% (food and prescription and nonprescription drugs are exempt). Additional county sales taxes can make the combined rate as high as 7.5%.
INCOME-TAX RANGE
No state income tax.
SOCIAL SECURITY
Benefits are not taxed.
EXEMPTIONS FOR RETIREMENT INCOME
Retirement income is not taxed.
PROPERTY TAXES
All property is taxable at 100% of its market value. Every person who owns and resides on property in Florida on January 1 and makes the property his permanent residence is eligible to receive a homestead exemption up to $50,000. The first $25,000 applies to all property taxes, including school district taxes. The rest of the exemption, up to $25,000, applies to the assessed value between $50,000 and $75,000, and only to nonschool taxes.
Any widow or widower who is a Florida resident may claim a $500 exemption. If you remarry, you are no longer eligible for the exemption.
A homeowner who is new to the state may qualify for a homestead exemption within one year of residence in Florida if he has not owned property in the state for the previous three years. This homestead exemption, which is equal to 50 percent of the homestead property’s market value, is for all levies other than school district levies. This exemption applies for five years or until the year the property is sold, whichever occurs first. The amount of the additional exemption is reduced in each subsequent year by 20% or by an amount equal to the difference between the market value of the property and the assessed value of the property, whichever is greater.
Tax breaks for seniors: For Florida residents ages 65 and older who meet certain income limits, an extra homestead exemption of up to $50,000 is allowed by some city and county governments.
INHERITANCE AND ESTATE TAXES
There is no inheritance tax and no estate tax.
Visit RetirementLiving.com for a complete rundown of taxes in Florida.
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