A recent study has placed Jackson, Wyoming the most tax-friendly place in the state to retire. To find the most tax friendly places for retirees, Smart Asset analyzed how the tax policies of each city would impact a theoretical retiree with an annual income of $50,000. The analysis assumes a retiree receiving $15,000 from Social Security benefits, $10,000 from a private pension, $10,000 in wages and $15,000 from a retirement savings account like a 401(k) or IRA. To calculate the expected income tax this person would pay in each location, the study applied the relevant deductions and exemptions. This included the standard deduction, personal exemption and deductions for each specific type of retirement income. Additionally, the effective property tax rate was calculated by dividing median property tax paid by median home value for each city. The study also took into consideration the impacts of sales tax, fuel tax, and whether or not Social Security was taxed. Topping the list nationally were locations in Alaska.
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