The Foreign Service Journal, February 2012

46 F O R E I G N S E R V I C E J O U R N A L / F E B R U A R Y 2 0 1 2 in Wisconsin are considered residents and are subject to tax on their entire in- come regardless of where the income is earned. Wisconsin’s current tax rate ranges from 4.6 percent on income up to $10,180 for single filers or $13,580 for joint filers, to a maximum of 7.75 per- cent on income over $224,210 for single filers or $298,940 for joint filers. Write: Wisconsin Department of Revenue, In- dividual Income TaxAssistance, P.O. Box 8906, MadisonWI 53708-8906. Phone: (608) 266-2772. E-mail: income@revenue.wi.gov Web site: www.dor.state.wi.us WYOMING: There is no state income tax and no tax on intangibles such as bank accounts, stocks or bonds. Write: WyomingDepartment of Revenue,Her- schler Building, 122 West 25th St., CheyenneWY 82002-0110. Phone: (307) 777-7320. E-mail: DirectorOfRevenue@wy.gov Web site: revenue.state.wy.us State Pension & Annuity Tax 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 pensions and annuities. Idaho taxes Foreign Service annuities while ex- empting certain categories of Civil Serv- ice employees. SeveralWeb sites provide more information on individual state taxes for retirees, but the Retirement Liv- ing Information Center at www.retire- mentliving.com/RLtaxes.html is one of the more comprehensive. 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 to as much as 12 percent. ALASKA: No personal income tax. Some municipalities levy sales, property and/or use taxes. ARIZONA: Up to $2,500 of U.S. gov- ernment pension income may be ex- cluded for each taxpayer. There is also a $2,100 exemption for each taxpayer age 65 or over. Arizona does not tax Social Security. Arizona state sales and use tax is 5.6 percent with additions depending on county and/or city. ARKANSAS: The first $6,000 of in- come from any retirement plan or IRA is exempt. Social Security is not taxed. There is no estate or inheritance tax. State sales and use tax is 6 percent; city and county taxes may add another 6.5 percent. CALIFORNIA: Pensions and annu- ities are fully taxable. The sales and use tax rate varies from 8.25 percent (the statewide rate) to 10.50 percent in some areas. COLORADO: Up to $24,000 of pen- sion income is exempt if 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 the total to as much as 9.9 percent. CONNECTICUT: Pensions and an- nuities are fully taxable for residents. So- cial Security is exempt if Federal Adjusted Gross Income is less than $50,000 for singles or $60,000 for joint filers. Statewide sales tax is 6 percent. No local additions. DELAWARE: Pension exclusions per person: $2,000 is exempt under age 60; $12,500 if age 60 or over. There is an ad- ditional standard deduction of $2,500 if age 65 or over if you do not itemize. So- cial Security income is excluded from taxable income. Delaware does not im- pose a sales tax. DISTRICT OF COLUMBIA: A pen- sion or annuity exclusion of $3,000 is ap- plicable if 62 years or older. Social Security is excluded from taxable in- come. Sales and use tax is 6 percent, with higher rates for some commodities. FLORIDA: There is no personal in- come, inheritance or gift tax. Florida re- pealed the “intangibles tax” in 2007. Florida imposes state sales tax and a use tax of 6 percent. Counties impose fur- ther taxes from 0.5 to 3.5 percent. GEORGIA: $35,000 of retirement in- come is excluded for those who are 62 years or older, or totally disabled. Be- ginning in tax year 2012, up to $65,000 of retirement income will be excludable for taxpayers who are 65 or older. Social Security is excluded from taxable in- come. Sales tax is 4 percent statewide, with additions of up to 5 percent de- pending on jurisdiction. HAWAII: Pension and annuity distri- butions from a government pension plan are not taxed in Hawaii. Social Se- curity is not taxed. Hawaii charges a general excise tax of 4 percent instead of sales tax. IDAHO: If the individual is age 65 or older, or age 62 and disabled, Civil Serv- ice Retirement Systemand Foreign Serv- ice Retirement and Disability System pensions qualify for a deduction in 2011 of up to $27,876 for a single return and up to $41,814 for a joint return. Up to $27,876may be deducted by the unmar- ried survivor of the annuitant. The de- duction is not available if married, filing separately; nor do Federal Employees’ Retirement System or Foreign Service Pension Systempensions qualify for this deduction. The deduction is reduced dollar for dollar by Social Security ben- efits. Social Security itself is not taxed. Idaho state sales tax is 6 percent; some local jurisdictions add as much as an- other 3 percent. ILLINOIS: Illinois does not tax U.S. government pensions or Social Security. State sales tax is 6.25 percent. Local ad- ditions can raise sales tax to 11.5 percent A F S A N E W S