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Where is better to live between Massachussets, New Hampshire and Maine for tax purposes?

I just got a job in New Hampshire very close to Maine and within a resanobale distance from Massachussets, where would be recommendable to live for tax purposes (to keep most of my paycheck)?

Public Comments

  1. It gets complicated as different states have taxes and most have reciprocal taxes, otherwise you'd be paying in the state you worked in as well as the state you lived in. Normally, NH will take the tax for Fed. & NH since you are paid in that state. Then you may have to file in the state you live in and if that rate is higher, you pay more. If it is lower, you don't usually pay anymore. But other factors are the property taxes, sales taxes or where you show, etc. Living in one state and working in another can be a hassle as you have to file forms in both locations, even in the same state with two different cities, you may have to pay different taxes as one may have an income tax and other one may be different. I used to live in one city in the same state and had rental property in a couple of other cities so I had city tax in each of those cities, and had to file even if I didn't owe any money there because of deductions, etc. So it isn't an easy answer and soeone would really have to have extensive knowledge and perhaps even know the city you lived in to answer your question. You will probably have to do your own research, and it will be research to check it out. But the more states you involve the more of a hassle with different forms. It is best if you work in a city where there is no income tax or if it is lower or unincorporated area and you live in the same place. Good luck to you.
  2. NH doesn't have an income tax on earned income, however NH property taxes are sky high. If you live in ME or MA you will pay state income taxes in those states regardless of where you work. You'll have to compare the basic costs of housing in all 3 states to figure out what will work best in your situation. Don't forget to factor in the cost of commuting as well. That can often wipe out any other benefits. If income taxes is the only priority then live in NH. However if total outlay is your concern -- and it should be -- then a more detailed analysis is needed.
  3. NH, no personal income tax or state sales tax. But if you are working in MA or ME, then you need to see if those state have a non-resident income tax.
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