The Foreign Service Journal, January-February 2015

74 JANUARY FEBRUARY 2015 | THE FOREIGN SERVICE JOURNAL PUERTO RICO The first $11,000 of income received from a federal pension can be excluded for individuals under 60. For those over 60, the exclusion is $15,000. If the individual receives more than one federal pension, the exclusion applies to each pension or annuity separately. Social Security is not taxed. RHODE ISLAND U.S. government pensions and annuities are fully taxable. Sales tax is 7 percent; meals and beverages 8 percent. SOUTH CAROLINA Individuals under age 65 can claim a $3,000 deduction on qualified retirement income; those 65 years of age or over can claim a $10,000 deduction on qualified retirement income. A resident of South Carolina 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 other retirement deduction claimed. Social Security is not taxed. Sales tax is 6 percent plus 1 percent in some counties. Residents aged 85 and over pay 5 percent. SOUTH DAKOTA No personal income tax or inheritance tax. State sales-and- use tax is 4 percent; municipalities may add up to an addi- tional 2 percent. Residents who are age 65 and older and have a yearly income of under $10,250 (single) or in a household where the total income was under $13,250 are eligible for a sales-tax refund. TENNESSEE Social Security, pension income and income from IRAs and TSP are not subject to personal income tax. Most interest and dividend income is taxed at 6 percent if over $1,250 (single filers) or $2,500 (married filing jointly). However, for tax year 2013 and subsequently, those over 65 with total income from all sources of less than $33,000 for a single filer and $59,000 for joint filers are completely exempt from all taxes on income. State sales tax is 5 percent on food, 7 percent on other goods, with between 1.5 and 2.75 percent added, depending on juris- diction. 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 Utah has a flat tax rate of 5 percent of all income. For taxpay- ers over 65 there is 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 state website for details. State sales tax is 4.7 percent; local option taxes may raise the total to as much as 9.95 percent. VERMONT U.S. government pensions and annuities are fully taxable. State general sales tax is 6 percent; local option taxes may raise the total to 7 percent (higher on some commodities). 2014 AFSA TAX GUIDE