There are many reasons people move to Florida, including abundant sunshine, beaches and our lack of a state income tax. There are often news articles about high-net-worth people moving from states with relatively high state income taxes (New York, California, New Jersey, Minnesota) to places with low or no state income taxes, such as Texas, Nevada, Wyoming, Tennessee and Florida.
A move from California (and its 13 percent state income tax) to Florida can mean substantial savings, which can in turn mean greater wealth and a larger estate to pass on to loved ones. Another motivation to move can be found in the recent limits placed on federal tax deductions for state and local taxes. The deductions used to be unlimited, but are now capped at $10,000.
Another factor in considerations of asset protection and estate planning is Florida’s homestead exemption.
Other popular destinations for the wealthy include Washington state and New Hampshire, a recent article stated. But those folks should sit down with an estate planning attorney before pulling up stakes for Washington, which has an estate tax.
Thirteen states have estate taxes, while a few (Nebraska, Iowa, Kentucky, Pennsylvania and New Jersey) have inheritance taxes.
Regardless, a CPA said tax migrations are not as common as news coverage might indicate. Taxes can play a role in moves, but most of the time, he said, family considerations are uppermost in wealthy people’s minds when they move from one state to another.
Talk to a Brevard County estate planning attorney to ensure that you taking advantage of estate planning law and tools that safeguard loved ones and assets.