As tax season kicks into gear, you may be wishing that you owed, well, a little less than you do. Just think: if you’d just picked somewhere different to live, you might. Of course, areas with higher taxes often offer other benefits paid for by those taxes (such as high property taxes resulting – sometimes – in a fine parks system or good schools). However, if you want to know where to move before the end of the year to get a break on 2014’s taxes, take a look at the top three cities for lowest taxes according to the federal Office of Revenue Analysis.
3. Billings, Montana
Billings is the only city in the top 10 list for lowest taxes that is not located in a state without income tax. It breaks the top three because it has the lowest sales and property tax burdens in the country. In fact, the state of Montana did not even have a general sales tax in 2012. Because Montana taxes oil and gas production and the region around Billings is enjoying an oil and gas boom, residents enjoy an extremely light tax burden.
2. Las Vegas, Nevada
If you live in Las Vegas and earn $25,000 a year, you will pay about $3,260 in taxes. If you make $150,000 a year, you will pay about $8,314. These numbers placed Las Vegas at the second-lowest tax-burdened state in the country despite its high unemployment and low median income numbers. Las Vegas not only does not have a state income tax, but it also has relatively low property tax rates.
1. Cheyenne, Wyoming
Wyoming not only does not have a state income tax, it also has a sales tax rate of just six percent in Cheyenne. The state also boasts an extremely low gas tax (14 cents per gallon) and an effective property tax rate of 0.67 percent. The city also has low unemployment (6.1 percent) and families earning $25,000 and $150,000 a year pay about $2,476 and $6,307 in taxes per year, respectively.
Would you make a decision about where to live based on tax burden? If you live in a heavily-taxed area, why did you make the decision to do so?
Your comments and questions are welcomed below.