A Simple Move Will Save This Couple Thousands

Relocating to a lower-tax and lower-cost state can make a lot of sense for retirees. 

- Sarah Max

CLARK HURST DISCOVERED Clear Creek Tahoe, a golf community near Lake Tahoe, a few years ago when a friend invited him and his wife, Ellen, to play the course for a day.

The Southern Californian parlayed that visit into a temporary membership at the new Nevada golf community. And then early last year, he and his wife bought a lot where they eventually plan to build a home, just across the street from the course. “Because of the elevation and the backdrop, the ball gets a lot of hang time,” says Hurst, 58. “It’s really dramatic.”

The same could be said for the potential tax savings the couple can enjoy by relocating to Nevada after they retire.

For Hurst, the allure of retiring to this golf community goes beyond its stunning 18-hole golf course, easy access to skiing and hiking, or its more than 850 acres of permanently protected open space. While retirement is still a ways off for the couple, Hurst figures that moving from a high-tax state (California) to a no-tax state (Nevada) could save them tens of thousands a year just in taxes.

He should know. He’s a certified public accountant.

THE CASE FOR MOVING TO A LOW-TAX STATE 

Sometimes the road to retirement means following the road less traveled, even if that takes you across state lines. The idea of moving from California, where the top state income tax rate is 13.3%, to Nevada—where there is no state income tax—was appealing even before the passage of the Tax Cuts and Jobs Act late last year.

That legislation is best known for having slashed personal income tax rates and boosted the standard deduction to $24,000 for married couples filing jointly.