The Foreign Service Journal, January-February 2023

THE FOREIGN SERVICE JOURNAL | JANUARY-FEBRUARY 2023 83 separately. Social Security is excluded from taxable income. RHODE ISLAND U.S. government pensions and annuities are fully tax- able. Social Security is taxed to the extent it is federally taxed. Joint filers at retire- ment age with a Federal Adjusted Gross Income over $111,200 ($88,950 for single filers) pay tax on Social Secu- rity benefits. Higher-income seniors are not eligible for the Rhode Island income tax exemption on private, gov- ernment, or military retire- ment plan payouts. Out-of- state government pensions are fully taxed. Sales tax is 7 percent; meals and bever- ages are 8 percent. SOUTH CAROLINA Retirement income is taxed, but individuals over age 65 can exempt $10,000 of quali- fied retirement income; those age 65 or over may claim a $15,000 deduction on qualified retirement income ($30,000 if both spouses are over 65), but must reduce this figure by any other retirement exclusion claimed. Social Security is excluded from taxable income. Sales tax is 6 percent plus up to 3 percent in some counties. Residents age 85 and older pay 5 percent. SOUTH DAKOTA No personal income tax or inheritance tax. State sales and use tax is 4.5 percent; municipalities may add up to an additional 2.75 percent. Residents age 66 and older and have an annual income under $12,880 (single) or total household income under $17,420 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. State sales tax is 5 percent on food; it is 7 percent on other goods, with between 1.5 and 2.75 percent added, depend- ing 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 Utah has a flat tax rate of 4.95 percent of all income. For taxpayers over age 65, there is a retirement tax credit of $450 for single filers and $900 for joint filers. Qualifying modified Adjusted Gross Income levels are under $25,000 for single residents and less than $32,000 for joint filers. Married taxpayers who file separate returns are eligible with a modified AGI under $34,000. See the state web- site for details. State sales tax ranges from 5.95 percent to 8.60 percent, depending on local jurisdiction. VERMONT U.S. government pensions and annuities are fully tax- able. Social Security benefits are taxed for single filer income greater than $45,000 annually or over $60,000 for joint filers. Out-of-state gov- ernment pensions and other retirement income are taxed at rates from 3.35 percent to 8.75 percent. State general sales tax is 6 percent; local option taxes may raise the total to 7 percent (higher on some commodities). VIRGINIA Individuals born before Jan 1, 1939, can claim a $12,000 deduction. If you were born between Jan. 2, 1939, and Jan. 1, 1956, your age deduc- tion is based on your income. The maximum $12,000 deduction is reduced by one dollar for each dollar by which Adjusted Gross Income exceeds $50,000 for single, and $75,000 for mar- ried, taxpayers. All taxpayers age 65 and over receive an additional personal exemp- tion of $800. Social Security is excluded from taxable income. The estate tax was repealed for all deaths after July 1, 2007. The general sales tax rate is 5.3 percent (4.3 percent state tax and 1 percent local tax, with an extra 0.7 percent in Northern Virginia). WASHINGTON No personal income tax. Retirement income is not taxed. State sales tax is 7 percent; rates are updated quarterly. Local taxes may increase the total to as much as 9 percent. WEST VIRGINIA All retirement income is taxed with the first $8,000 (individual filers) or $16,000 (married filing jointly) being exempt. Out-of-state govern- ment pensions qualify for this exemption. In 2022, Social Security is not taxed if Federal Adjusted Gross Income does not exceed $100,000 (married filing jointly) or $50,000 (filing singly). State sales tax is 6 percent, with additions of between 0.5 and 1 percent in some jurisdictions. WISCONSIN Pensions and annuities are fully taxable. Social Security is excluded from taxable income. Those age 65 and over may take two personal deductions totaling $950. Benefits received from a federal retirement system account established before Dec. 31, 1963, are not taxable. Those age 65 and over and with a Federal Adjusted Gross Income of less than $15,000 (single filers) or $30,000 (joint filers) may exclude $5,000 of income from fed- eral retirement systems or IRAs. Those over age 65 may take an additional personal deduction of $250. State sales tax is 5 percent; local taxes may add another 1.75 percent. WYOMING No personal income tax. State sales tax is 4 percent. Local taxes may add up to 2 percent on sales and 4 percent on lodging. n