The Foreign Service Journal, February 2012

F E B R U A R Y 2 0 1 2 / F O R E I G N S E R V I C E J O U R N A L 49 A F S A N E W S than one federal pension, the exclusion applies to each pension or annuity sepa- rately. Social Security is not taxed. RHODE ISLAND: U.S. government pensions and annuities are fully taxable. Sales tax is 7 percent. SOUTH CAROLINA: Individuals under age 65 can claim a $3,000 deduc- tion on qualified retirement income; those 65 years of age or over can claim a $10,000 deduction on qualified retire- ment income. A resident of South Car- olina who is 65 years or older may claim a $15,000 deduction against any type of income ($30,000 if both spouses are over 65), but must reduce this figure by any retirement deduction claimed. Social Security is not taxed. Sales tax is 6 per- cent plus 1 percent in some counties. Seniors 85 and over pay 5 percent. SOUTH DAKOTA: No personal in- come tax or inheritance tax. State sales and use tax is 4 percent; municipalities may add up to an additional 2 percent. TENNESSEE: Social Security, pen- sion income and income from IRAs and TSPs are not subject to personal income tax. Most interest and dividend income is taxed at 6 percent if over $1,250 (sin- gle filers) or $2,500 (married filing jointly). However, those over 65 with total income fromall sources of less than $16,200 for a single filer and $27,000 for joint filers are completely exempt from all taxes. State sales tax is 7 percent with between 1.5 and 2.75 percent added, de- pending on jurisdiction. TEXAS: No personal income tax or inheritance tax. State sales tax is 6.25 percent. Local options can raise the rate to 8.25 percent. UTAH: In 2008, Utah instituted a flat tax rate of 5 percent of all income. The previous retirement income exclusion has been replaced for taxpayers over 65 by a retirement tax credit of $450 for single filers and $900 for joint filers. This is reduced by 2.5 percent of income exceeding $25,000 for single filers and $32,000 for joint filers. See the stateWeb site for details. State sales tax is 4.7 per- cent; local option taxes may raise the total to as much as 7.95 percent. VERMONT: U.S. government pen- sions and annuities are fully taxable. State general sales tax is 6 percent; local option taxes may raise the total to 7 per- cent (higher on some commodities). VIRGINIA: Individuals over age 65 can take a $12,000 deduction. The $12,000 deduction is reduced by one dollar for each dollar by whichAdjusted Gross Income exceeds $50,000 for sin- gle, and $75,000 for married, taxpayers. All taxpayers over 65 receive an addi- tional personal exemption of $800. So- cial Security income is exempt. The estate tax was repealed for all deaths after July 1, 2007. The general sales tax rate is 5 percent (4 percent state tax and 1 percent local tax). WASHINGTON: No personal income tax. State sales tax is 6.5 percent; rates are updated quarterly. Local taxes may increase the total to 9.5 percent. WEST VIRGINIA: $2,000 of any civil or state pension is exempt. Social Secu- rity income is taxable only to the extent that the income is includable in Federal Adjusted Gross Income. Taxpayers 65 and older or surviving spouses of any age may exclude the first $8,000 (indi- vidual filers) or $16,000 (married filing jointly) of any retirement income. Out- of-state government pensions qualify for the $8,000 exemption. State sales tax is 6 percent. WISCONSIN: Pensions and annuities are fully taxable. Those age 65 or over may take two personal deductions total- ing $950. Benefits received from a fed- eral retirement system account established before Dec. 31, 1963, are not taxable. Since TaxYear 2008,Wisconsin has not taxed Social Security benefits in- cluded in Federal Adjusted Gross In- come. For tax years after 2009, those over 65 and with a FAGI of less than $15,000 (single filers) or $30,000 (joint filers) may take a $5,000 deduction on income from federal retirement systems or IRAs. State sales tax is 5 percent. Most counties charge an extra 0.5 per- cent. WYOMING: No personal income tax. State sales tax is 4 percent. Local taxes may increase the total to 6 percent. Energy credit: In 2011, the maximumnon-business energy property credit is $500 minus amounts taken in 2006 through 2010. There are also other, lesser energy credits. For more on these and other provisions, go to www.irs.gov. Capital gains and losses: Schedule D will look different for 2011. A new Form 8459 will be used to list all of the short-termand long-termcapital gains and losses. The totals on Form 8459 flow to page 1 of Schedule D. New for 2011 The AFSA Tax Guide is also available online at www.afsa.org/afsa_tax_guide.aspx