Nashville is certainly a hot spot for millennials, but it is also gaining a lot of interest from another generation. More and more people are looking to Nashville as a viable retirement option because of it’s central location, excellent weather, exciting atmosphere and superb health care. There are however, three financial reasons that make Nashville attractive as well.
1. No More Inheritance Tax
Thankfully, as of January 2016, this tax is no longer in effect. One thing that kept many people from considering retiring in Nashville was Tennessee’s Estate Tax or as some call it, “Death Tax.” This tax was levied on beneficiaries who received an inheritance from a family member’s estate. For example: If you received more than $440,000 you would have to pay $30,200 plus 9.5% on any funds in excess of that $440,000. That’s quite a substantial burden that was about to be placed on an aging baby boomer population.
2. No State Income Tax
Another major bonus to living in Tennessee is that there is no state income tax. This is huge for Nashville residents who plan on retiring off of their 401K or IRA. While there’s no way to get around paying federal taxes, residents here are thankful that they don’t have to pay any state income tax on these distributions.
3. Repealing of the Hall Tax
Just days ago, state lawmakers voted to completely repeal the Hall Tax. This was a tax that was levied on dividends from stocks, bonds, investment trusts and capital gains. An exemption of $1,250 ($2,500 for married filing jointly) was allowed, but those receiving more were taxed at 6% on the total dividends. For retirees with large portfolios, this was seen as a huge deterrent to living in Nashville. The good news is, starting this year, the Hall Tax will be decreased by 1% every year until it reaches 0% in 2022.
Thinking About Retiring in Nashville? Contact Us to Discuss Your Real Estate Goals.