The Foreign Service Journal, February 2013

58 FEBRUARY 2013 | THE FOREIGN SERVICE JOURNAL AFSA NEWS State sales tax is 4 percent with local additions up to a possible total of 10.75 percent. Use tax is 8 percent regardless of the purchaser’s location. MAINE Recipients of a govern- ment sponsored pension or annuity who are filing singly may deduct up to $6,000 ($12,000 for married filing jointly) on income that is included in their Federal Adjusted Gross Income, reduced by all Social Security and railroad benefits. For those age 65 and over, there is an additional standard deduction of $1,400 (sin- gle),$1,100 (married filing singly) or $2,200 (married filing jointly). General sales tax is 5 percent. MARYLAND Those over 65 or perma- nently disabled, or who have a spouse who is permanently disabled, may under certain conditions be eligible for Maryland’s maximum pen- sion exclusion of $26,100. Also, all individuals 65 years or older are entitled to an extra $1,000 personal exemption in addition to the regular $3,200 personal exemption available to all taxpayers. Social Security is exempt. See the work- sheet and instructions in the Maryland Resident Tax Booklet. Maryland sales tax is 6 percent. MASSACHUSETTS Distributions made to a retiree from a federal employee contributory plan are excluded from Massachu- setts gross income. Social Security is not included in Massachusetts gross income. Each taxpayer over age 65 is allowed an additional $700 exemption on other income. Sales tax is 6.25 percent. MICHIGAN For Tax Year 2012, there are changes for those born after 1946, and greater changes for those born after 1952. In 2012, pension benefits included in Adjusted Gross Income from a private pen- sion system or an IRA are deductible, for those born before 1946, to a maximum of $47,309 for a single filer, or $94,618 for joint filers. This maximum is reduced by the deduction taken for the government pension. If born after 1946 and before 1952, the exemption is limited to $20,000 for singles and $40,000 for married filers. If born after 1952, not eligible for the exemption until reach- ing age 67. Full details at: www.michigan.gov/docu- ments/taxes/Tax_Change_ Summaries_-_Retirement_ Exemptions_359799_7.pdf. Michigan has no city, local, or county sales tax. The state sales tax rate is 6 percent. MINNESOTA Social Security income is taxed by Minnesota to the same extent it is on your federal return. If your only income is Social Security, you would not be required to file an income tax return. All federal pensions are tax- able, but single taxpayers who are over 65 or disabled may exclude some income if Federal Adjusted Gross Income is under $33,700 and non-taxable Social Security is under $9,600. For a couple, the limits are $42,000 for Adjusted Gross Income and $12,000 for non-taxable Social Security. Statewide sales and use tax is 6.875 percent; some local additions may increase the total to 9.53 per cent. MISSISSIPPI Social Security and qualified retirement income from fed- eral, state and private retire- ment systems are exempt from Mississippi tax. There is an additional exemption of $1,500 on other income if over 65. Statewide sales tax is 7 percent. MISSOURI In 2012, 100 percent of public pension income may be deducted if Missouri Adjusted Gross Income is less than $100,000 when married filing jointly or $85,000 for single filers, up to a limit of $33,703 for each spouse. In 2012 you may also deduct 100 percent of Social Security income if over age 62 and Federal Adjusted Gross Income is less than the limits above. Sales tax is 4.225 percent; local addi- tions may add another 2 percent. MONTANA There is a $3,000 pension income exclusion if Federal Adjusted Gross Income is less than $30,000. Those over 65 can exempt an additional $800 of interest income for single taxpayers and $1,600 for married joint filers. Social Security is sub- ject to tax. Montana has no general sales tax, but tax is levied on the sale of various commodities. NEBRASKA U.S. government pensions and annuities are fully taxable. Social Security is taxable. State sales tax is 5.5 percent, with local additions of up to 2 percent. NEVADA No personal income tax. Sales and use tax varies from 6.85 to 8.1 percent, depend- ing on local jurisdiction. NEW HAMPSHIRE No personal income tax. The inheritance tax was 2012 TAX GUIDE