LOUISIANA
Return to Retiree Tax Map
NICKNAME
The Pelican State
BOTTOM LINE: TAX-FRIENDLY
Louisiana offers a bayou full of tax breaks to retirees. Social Security, military, civil-service, and state and local government pensions are exempt from state income taxes. Up to $6,000 per person of pension and annuity income are exempt from income taxes. Personal income tax rates are low. Property taxes are among the lowest in the nation, and assessments are based on 10% of the fair market value.
STATE SALES TAX
4%. Local parishes and jurisdictions within those parishes may add their own sales taxes, which can boost the total to 11%. Food, drugs, wheelchairs and prosthetic devices are taxed locally.
INCOME-TAX RANGE
Low: 2% (on less than $12,500 of taxable income)
High: 6% (on more than $50,000 of taxable income)
SOCIAL SECURITY
Social Security benefits are not taxed.
EXEMPTIONS FOR OTHER RETIREMENT INCOME
People 65 or older may exclude up to $6,000 of annual retirement income from their taxable income. Federal retirement benefits, both military and nonmilitary, may be excluded from Louisiana taxable income. In addition, deferred income from municipal and state police employees' retirement plans is exempt from state income tax.
PROPERTY TAXES
Taxes are assessed and collected at the local level by 64 parishes and seven municipal districts. Property assessments are based on 10% of the fair market value of the property. Homeowners receive a homestead exemption of $7,500 of their home’s assessed value. The exemption is applied against the assessed value of the home. However, this exemption does not generally apply to municipal taxes.
Tax breaks for seniors: Homeowners who are 65 or older with adjusted gross income of less than $65,891 in 2012 can benefit from freezing the assessed value of their homestead for as long as the applicant owns and resides in the home and income does not exceed the maximum allowed. This benefit is lost if improvements in excess of 25% of the home's value are added.
INHERITANCE AND ESTATE TAXES
Louisiana has neither an inheritance tax nor an estate tax.
Visit RetirementLiving.com for a complete rundown of taxes in Louisiana.
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