The Foreign Service Journal, January-February 2019

84 JANUARY-FEBRUARY 2019 | THE FOREIGN SERVICE JOURNAL AFSA NEWS ALABAMA Social Security and U.S. government pensions are not taxable. The combined state, county and city general sales and use tax rates range from 7 percent to as much as 8.65 percent. See also www. revenue.alabama.gov/taxpay- erassist/retire.pdf. ALASKA No personal income tax. Most municipalities levy sales and/ or use taxes of between 2 and 7 percent and/or a property tax. If over 65, you may be able to claim an exemption. ARIZONA Up to $2,500 of U.S. govern- ment pension income may be excluded for each taxpayer. There is also a $2,100 exemp- tion for each taxpayer age 65 or over. Social Security is excluded from taxable income. Arizona state sales and use tax is 5.6 percent, with additions depending on the county and/or city. 2018 STATE PENSION AND ANNUITYTAX The laws regarding the taxation of Foreign Service annuities vary greatly from state to state. In addition to those states that have no income tax or no tax on personal income, there are several states that do not tax income derived from pen- sions and annuities. For example, Idaho taxes Foreign Service annuities while exempting certain categories of Civil Service employees. Several websites provide more information on individual state taxes for retirees, but the Retirement Living Information Center at www.retirementliving.com/taxes-by- state is one of the more comprehensive and is recommended for further information. ARKANSAS The first $6,000 of income from any retirement plan or IRA is exempt (to a maximum of $6,000 overall). Social Security is excluded from taxable income. There is no estate or inheritance tax. State sales and use tax is 6.5 percent; city and county taxes may add another 5.5 percent. CALIFORNIA Pensions and annuities are fully taxable. Social Security is excluded from taxable income. The sales and use tax rate varies from 7.25 percent (the statewide rate) to 11 per- cent in some areas. CA Pub 71 lists all rates statewide. COLORADO Up to $24,000 of pension or Social Security income can be excluded if the individual is age 65 or over. Up to $20,000 is exempt if age 55 to 64. State sales tax is 2.9 percent; local additions can increase it to as much as 11.2 percent. WASHINGTON There is no state income tax and no tax on intangibles such as bank accounts, stocks and bonds. Residents may deduct Washington sales tax on their federal tax returns if they itemize deductions. State tax rate is 6.5, percent; local additions can increase that to 10.4 percent in some areas. Write: Washington State Department of Revenue, Taxpayer Services, P.O. Box 47478, OlympiaWA 98504-7478. Phone: (800) 647-7706 Website: www.dor.wa.gov Email: Link through the website’s “Contact Us” tab. WEST VIRGINIA There is no tax liability for out-of-state income if the individual has no permanent residence inWest Virginia, has a permanent residence elsewhere and spends nomore than 30 days of the tax year inWest Virginia. However, nonresident domiciliaries are required to file a return on Form IT-140 for all income derived from West Virginia sources. Tax rates rise in four steps from4 percent of taxable income over $10,000 for joint and single filers, to 6.5 percent of taxable income for joint and single filers over $60,000. Write: Department of Tax and Revenue, The Revenue Center, 1001 Lee St. E., CharlestonWV 25337-3784. Phone: (800) 982-8297 or (304) 558-3333 Website: www.wvtax.gov Email: TaxHelp@WV.Gov WISCONSIN Individuals domiciled inWisconsin are considered residents and are subject to tax on their entire income, regardless of where the income is earned.Wisconsin’s 2018 tax rate rises in four steps from 4 percent on income up to $11,450 for single filers or $15,270 for joint filers to a maximum of 7.65 percent on income over $252,150 for single filers or $336,200 for joint filers. Write: Wisconsin Department of Revenue, Customer Service Bureau, P.O. Box 8949, MadisonWI 53708-8949. Phone: (608) 266-2486 Website: www.revenue.wi.gov Email: Through the “Contact Us” link on the website. WYOMING There is no state income tax and no tax on intangibles such as bank accounts, stocks or bonds. State sales tax is 4 percent. Local jurisdictions may add another 2 percent sales tax and 4 percent for lodging. Write: Wyoming Department of Revenue, Herschler Building, 122West 25th St., CheyenneWY 82002-0110. Phone: (307) 777-5200 Website: http://revenue.wyo.gov/ Email: dor@wyo.gov n