Badger InstituteBadger Institute
  • Home
  • Issues
    • Taxes
    • Education
    • Crime & Justice
    • Spending & Accountability
    • Economy & Infrastructure
    • Licensing
    • Healthcare
    • Civil Society
  • Mandate for Madison
  • Research
  • Magazines
    • Diggings
    • Wisconsin Interest
  • Events
  • Media
    • Podcast
    • Fact Sheets
    • Viewpoints
    • Press Releases
    • Badger in the News
    • Video
    • Audio
    • Testimony
  • About
    • Our Mission
    • Board of Directors
    • Team
    • Visiting Fellows
    • America’s Future
    • Careers
  • Newsletter
  • Donate
  • Contact Us

Subscribe for Updates

Get the latest news and updates from Badger Institute.

What's New

Wisconsin lawmakers in the dark on broadband

March 16, 2023

The underfunded part of Wisconsin public schooling

March 16, 2023

If we don’t pay for roads, we don’t get mobility

March 9, 2023
Facebook Twitter YouTube LinkedIn Instagram
TRENDING:
  • Wisconsin lawmakers in the dark on broadband
  • The underfunded part of Wisconsin public schooling
  • If we don’t pay for roads, we don’t get mobility
  • Assembly Speaker calls for tolling to fund Wisconsin infrastructure
  • Foreseeing the Future of Wisconsin’s Flat Tax
  • Amid illiteracy, where was the urgency?
  • Calls to Police from MPS High Schools Up Dramatically Again
  • Wisconsin voters will be asked about welfare work requirements
  • Donate
  • Newsletter
  • Contact
Facebook Twitter YouTube LinkedIn Instagram
Badger InstituteBadger Institute
SUPPORT OUR MISSION
  • Issues
    • Taxes
    • Education
    • Crime & Justice
    • Spending & Accountability
    • Economy & Infrastructure
    • Licensing
    • Healthcare
    • Civil Society
  • Mandate for Madison
  • Research
  • Magazines
    • Diggings
    • Wisconsin Interest
  • Events
  • Media
    • Podcast
    • Fact Sheets
    • Viewpoints
    • Press Releases
    • Badger in the News
    • Video
    • Audio
    • Testimony
  • About
    • Our Mission
    • Board of Directors
    • Team
    • Visiting Fellows
    • America’s Future
    • Careers
Facebook Twitter YouTube LinkedIn
DONATE
Badger InstituteBadger Institute
Home » Media » Reports » Retirement Migration in Wisconsin
Economic Development

Retirement Migration in Wisconsin

By Sammis White, Ph.D.August 2, 2006
Share
Facebook Twitter LinkedIn Pinterest

The impact of state taxes

As states look for ways to stimulate their economies, one option deserves some further examination. That option is the attraction or retention of retirees through tax policies. The basic question is should states, most notably Wisconsin, attempt to attract/retain retirees by reducing or eliminating their taxation of retirement income? Are the payoffs from being the legal residence of an increasing number of retirees worth the costs that might be involved in attracting and retaining these individuals? These are very important questions to a number of states, including Wisconsin, that do not currently have fiscal policies in place to make them appealing to retirees.

Retirees are an increasing proportion of the U.S. population, and their proportion will really begin to jump, start- ing in 2011, as the first group of baby boomers reaches 65 years of age. In 2000 only one state had an elderly (aged 65 and over) population that exceeded 17.5% of its overall population. Not surprisingly, that was Florida. But by 2025, 39 of 50 states plus the District of Columbia are projected to exceed 17.5% (Conway and Rork 2004).

Some states have already assumed that this is a group of individuals that should be attracted or retained. Two researchers (Longino and Crown 1989) termed retirees “pure gold.” Mackey and Carter (1994) wrote that “some states have recognized the possibility and are using the tax system to become retirement havens.” Retirees can move to states such as Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming, and, like all residents, not face any state income tax. They can move to New Hampshire or Tennessee and be taxed only on dividends and interest income. Or retirees can move to Illinois, Mississippi, or Pennsylvania and be fully exempt from state income taxation of all Social Security payments and all forms of retirement income, including both public and private pension income and 401(k), 403 (b), and IRA payouts.

Seven other states fully exempt public pensions (federal, civil service, military, state and local government) but do not fully exempt private pension income. Others have more limited exemptions from income taxes (Baer 2001). In all some 35 of the 41 states with a broad-based income tax offer some form of income tax reduction to retirees. Despite this pattern six states have done nothing to treat retirees as special, and several others (including Wisconsin with its taxation of up to 50% of Social Security benefits) give only small concessions to retirees. Fifteen states, in fact, tax Social Security benefits, but not all fully tax these benefits.

Appealing as it may be to think of retirees as terrific assets for one’s economy, the picture may not be as clear as earlier researchers have stated, because retirees are not all alike. It also may not be as clear to individual retirees as to just where it is they should be locating. The confusion on the latter comes because states raise revenue in a variety of ways, and states that may have low or no income tax may have high sales or property taxes that more than compensate for the lack of an income tax. Furthermore, there may be some question as to the responsiveness of individuals to fiscal incentives and to the true benefits that are supposed to accrue to the communities that enlarge their retiree populations. And there is evidence that the young-old (65-74 year olds) behave somewhat differently from the old-old (75 and over) in their location decisions. Because of these many issues, it is important that we take a closer look at the issue of retirees as economic development generators.

Vol19no8Download

Reports
Share. Facebook Twitter Pinterest LinkedIn Tumblr Telegram Email
Sammis White, Ph.D.

Related Posts

Wisconsin lawmakers in the dark on broadband

March 16, 2023

Assembly Speaker calls for tolling to fund Wisconsin infrastructure

March 2, 2023

Foreseeing the Future of Wisconsin’s Flat Tax

March 2, 2023
Categories
Top Posts

Local pols filling old budget holes with massive COVID aid

December 8, 20221,447

This is not four years ago

November 10, 20221,283

A state without convictions

January 12, 2023643

Billions in federal spending in Wisconsin unaudited; results never measured

November 9, 2022484
Archives

Sign Up for Top Picks

Our weekly e-Newsletter with the latest items and updates

Connect with Badger Institute
  • Facebook
  • Twitter
  • YouTube
  • LinkedIn
About Us
About Us

The Badger Institute is a nonpartisan, not-for-profit institute established in 1987 working to engage and energize Wisconsinites and others in discussions and timely action on key public policy issues critical to the state’s future, growth and prosperity.

Facebook Twitter Instagram YouTube LinkedIn

Sign Up for Top Picks

Our weekly e-Newsletter with the latest items and updates

What’s New

Wisconsin lawmakers in the dark on broadband

March 16, 2023

The underfunded part of Wisconsin public schooling

March 16, 2023

If we don’t pay for roads, we don’t get mobility

March 9, 2023

Assembly Speaker calls for tolling to fund Wisconsin infrastructure

March 2, 2023
© 2023 Badger Institute | Privacy Policy | Disclaimer | Sitemap

Type above and press Enter to search. Press Esc to cancel.

This site uses functional cookies and external scripts to improve your experience.

Privacy settings

Privacy Settings

This site uses functional cookies and external scripts to improve your experience. Which cookies and scripts are used and how they impact your visit is specified on the left. You may change your settings at any time. Your choices will not impact your visit.

NOTE: These settings will only apply to the browser and device you are currently using.

CRM Software

Customer Relationship Management Software

Google Analytics

Google Analytics is a web analytics service offered by Google that tracks and reports website traffic. Google uses the data collected to track and monitor the use of our Service. This data is shared with other Google services. Google may use the collected data to contextualize and personalize the ads of its own advertising network.

You can opt-out of having made your activity on the Service available to Google Analytics by installing the Google Analytics opt-out browser add-on. The add-on prevents the Google Analytics JavaScript (ga.js, analytics.js, and dc.js) from sharing information with Google Analytics about visits activity.

For more information on the privacy practices of Google, please visit the Google Privacy & Terms web page: https://policies.google.com/privacy?hl=en

Powered by Cookie Information