You know all those Florida license plates you see around Westport?
Most of them belong to Westporters with 2nd homes. It’s a good life. But it does come with perils.
Like making sure you don’t spend so much time here, you’d have to pay state income taxes.
As with everything these days, there’s an app for that.
For just $19.99 a year, TaxBird can save you thousands. It tracks your location, showing how many days you’ve spent in each state — and how many days you have left.
You’re automatically notified when you approach a state residency threshold.
That’s an interesting story for those of us — I mean, of you — with 2nd homes.
But there’s an even stronger “06880” connection: Co-founder Jim Simon lives in Westport.
Some of the time.
He became a Florida resident to avoid Connecticut taxes, he tells the Greenwich blog For What It’s Worth.
So the next time you see people in Westport with Florida plates, tell them about TaxBird.
On second thought, don’t.
We need their taxes.
(Hat tip: Iain Bruce)
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This is too, too funny. We moved out of WP in CT to Bonita Springs FL. because of the high taxes. I miss you all but I think Malloy ruining the lovely state.
We are thinking of making the move to Bonita or Naples once the kids graduate- how do you like it so far?
It’s not all on Malloy. Don’t forget to mention Jodie Rell who really ‘jump started’ taxes in CT…and BTW she now resides in Florida.
As I recall, since I was living in the state at the time, it was on Governor Weicker’s watch that state income taxes were 1st implemented. Am I mistaken?
A bit of a Hartford Adress this morning. One score and five years ago, Connecticut had no state income tax, a very pro-business atmosphere, and a stable revenue stream from its sales tax.
Businesses and corporate headquarters were relocating here.
Then, our turncoat Governor and the Legislature imposed a personal income tax for the first time in the state’s history. Typically of ambitious politicians, he ran against it during his election campaign.
Taxpayers? Promised a limit to state spending, the legislature refused to enact the terms of that voter-approved measure. The constitutional spending cap never went into effect.
As it always is with income taxes, the Connecticut income tax was, at first, a flat rate of 4.5 percent. But as the number of tax brackets expanded to seven, the top rate jumped to 6.99 percent. Only politicians would think that we voters regard 6.99 any different from 7 percent.
By 2013, Connecticut had the second-highest income tax per capita, at $2,161, just slightly less per capita than New York.
Last year we landed in the top three of states losing its most important asset: its people.
Greg-one major issue missing from your adresss. For those that remember or have done the analysis, the 4% state income tax raised so much new revenue that the Governor (s) started to give away the most lucrative statenworker benefits in the USA. Governor after governor never stopped to say how CT would pay for the granting of these tremendous benefits.
Fast forward to today and 53% of all expenses in the CT General Fund got to pension plans, medical plans and state debt. Add in rhe state worker salaries and you get to 80% of the budget expenses.
After 2 of the state largest tax
Increases, 2011 and 2015 and CT still faces massive billions in deficits. Our own State Rep Steinberg voted for the tax increases and he just voted to extend the state worker contracts till 2027!!
367 Families in CT paid over 12% of the total state income collected. And many are beginning to move out of CT and there is NO HOPE FOR REFORM. There are state lawmakers who today, are calling for higher taxes.
Dan-thanks for posting the app. I am sure many will find it useful.
Agreed. The income tax did generate a flood of new revenues — $126 billion over 25 years but, savings was not a priority. State government ran up $6.1 billion in budget surpluses between 2000 and 2014, according to nonpartisan analysts. Only one-third of it, $2.1 billion, was placed in the budget reserve. The rest was spent.
CT tax payers pay for each state employee than any other state in the nation, so it costs more to deliver services. Govt employees are paid from 25 to 45% more than the private sector peers and the main reason for the rapid expense rise is that we continue to be controlled by the State Employees Bargaining Agent Coalition AKA SEBAC. SEBAC has one of the best pensions (public or private) in the country, although they are funded at 25 cents on the dollar and have unrealistic financial metrics. Our unfunded liabilities ranks us in the 2nd worst spot behind Illinois. We also have one of the largest % of union workers at 18% as well as the highest % of pension cost of any state. btw, Government unions, represent 69 percent of the public-sector workforce.
Greg-thanks for your analysis and work. What people in Westport will begin to learn is there are no more gimmicks left to balance the state’s budget. The game is over.
With the help YES votes by Jonathan Steinberg, the SEBAC agreeement has now been extended 10 years till 2027-past 2 terms of a new governor. He and his fellow state worker party friends made it impossible to balance the budget over the extended term without increasing state revenues, AKA HIGHER TAXES.
Already the talk in hartford are for tolls and an increase in the gasoline tax. And one more tax-$3 per tire tax. Yes-you cannot make that up. These extra taxes will try and shore up the transportation fund. The vote is coming.
Next will be how the state handles the upcoming $2 BILLION budget deficit. Some in Hartford are calling for higher taxes. Despite the fact that the wealthy have been leaving CT, and that despite the higher taxes approved by Steinberg, state revenues have started to flatten if not drop. State worker pension costs will rise by Billions and state worker medical costs will do the same.
I wonder how many Westporters know that state workers mostly pay a minuscule 2% of the cost for their medical. It compares to 35% for the private sector workers. Yet Steinberg and his party refuse to reform these benefits.
Greg-CT has hit the inflection point where the gimmicks are over. The next several years will be very difficult. Steinberg has helped create 2 middle class residents in CT-one who is doing great called the state worker-the other are the private sector workers who are not.
This will all come out over the next month or two as the legislators go back into session.
It will be the battle to save the state.
What’s a “tire tax”? Recycling? What’s wrong with that?
Borrow as much as you can, and never pay it down? Perverse.
It seems that US news reporting is mute as to the reality of the US tax system, confusing everyone.
Keep in mind if Florida is your primary residence you will lose the $250;000 per person home sale exclusion if you sell your Connecticut home..
That assumes your home has appreciated in value. Which is not really happening around here right now.
Not if you sell it within three years of leaving which most people do. Most likely for those who choose to retain their Connecticut residence long term tax savings far outweigh the deduction loss it they ultimately sell. Read Greg Kraut above. The turncoat Governor was Weicker who passed on a golden opportunity to restore the fiscal responsibility of our Yankee Forbearers. He stands out as the one individual who set the stage for a voracious legislature to waste every revenue stream from that ungodly income tax to Casino and Lottery revenue as well as the hundreds of taxes and fees (yes hundreds!) since assessed against Connecticut businesses and residents. My guess is he no longer lives in Connecticut but if he does he’s probably hiding under a rock somewhere.
Umm, not if you sell your CT house when you move. For example, if you downsize since you don’t need the old large place in CT if you are there less than 6 months. Or, if you like the old place, maybe sell it (or gift it) to your children and rent it from them (they’d probably even be able to take the full property tax deduction against the rent). I’m sure a good tax and or estate advisor could help you out with other ideas.
Even if you didn’t do anything and lost the exclusion, at some point the tax savings from living in a no income tax state will offset any higher taxes from the loss of exclusion. Add in the cost of living benefits…
There are ways around this by putting it into an LLC/trust.
Connecticut is a nice place to live, but our state government (a Democrat dominated legislature and zero fiscal discipline from any of the Republican governors we’ve elected) has spent the last two decades making it very very expensive to live here. When somebody keeps his house in CT but changes his permanent residence to another state, the state sinks ever further into the financial morass: that person no longer pays CT income taxes, AND nobody replaces him in that house to pay state income taxes.
That is a good argument to shift the burden from income taxes onto property taxes (say by shifting teacher’s pension to the towns) to get the “snowbirds” to pay their “fair share”. Of course, that would just encourage folks to sell their houses and permanently leave further pushing down property values. Which, of course, would help solve the loss of exclusion issue.
Why not just spend less. Maybe some zero based budgeting?
I agree. Going down the route of just raising taxes when the people you are trying to tax are mobile and/or have other options is ultimately futile and, perhaps, a death spiral.
The income tax was suppose to fix the problem. The result? Further in debt…
The casinos will fix the problem. The result? Further in debt…
The lottery will fix the problem. The result? Further in debt…
The addition of tolls and raising the gas tax will definitely fix the problem…
WELCOME TO FLORIDA.
That would be “supposed” to fix…
I’ve made a note of this for my buyer clients here in Naples, FL. Go to http://www.sallykellogg.com and I can answer all your Florida real estate questions… I still see lots of CT license plates this time of year!
We can hack the app so it can be used and not pay the $19.99 per year.
That’s why we’re moving to the Sarasota, FL area later this year. It’s too expensive here and then …. the increased taxes they charge .. they don’t even SPEND correctly. I grew up in Westport since I was 13 and my husband is from Bristol, CT but lived in Wilton, CT with his ex wife and step daughter for 16 years. We have family and roots in CT and NY but …. this state is ridiculous .. and CT is one of the 6 worst states to DIE in. Many of my friends, who don’t live in CT and lost their elderly wealthy parents who still lived in CT, were dumbfounded by how much money they “take” just because the person dies. Ridiculous. I don’t mind paying taxes because it costs money to run everything but … I care how much you take and then .. WHAT you do with that money.
All power to those clever app creators, their ability to fleece buyers out of $20, when you can buy a nifty “Justin Trudeau, my Canadian Boyfriend” wall calendar for only $14.99! (published by Uniiverse Publlishing, 300 Park Ave. NY. Or, is that just a “front”?)
Ha
I WONDER HOW MANY MOVE TO ESCAPE TAXES AFTER THEY HAVE TAKEN ADVANTAGE OF OUR SUBSIDIZED SCHOOLS.
Subsidized schools? Care to explain?
I moved here from Westchester over 20 years because I could buy twice the house and pay half the taxes, live minutes from (multiple) beaches, raise my child in the best (public) schools, be 1 hr from NYC for all it offers, enjoy the 4 seasons, live in a historic home, get involved with passionate intelligent small town advocates, automatically belong to a country club on the beach (Longshore) just by being a resident, pick oysters on the beach, walk in the (Brett) woods with my dogs, etc etc etc. I thought this was La-La Land and I died and went to heaven..on earth. If you truly want to understand what is wrong with CT read the recent article from the CEO of Phillips Corp. who is moving his company to Boston. We haven’t invested in our cities. The “digital divide” is not being addressed, we are an aging population for it with no future outlook. Look at what IS booming…San Fran, Boston, NYC, etc and most importantly why. Good Luck to you in Florida I hear the blue plate specials start at 5 and (most of) the alligators are domesticated, me, I hope to live my days out here in La-La Land, invite me down to visit you in February,(not July).
I agree with everything you stated. My Dad moved us here in 1974 for the same exact reasons and we loved growing up in the Town of Westport! I hate FL but … to save 75k a year in taxes, not to mention buying the same house & property for 1/3, I’ll suck it up 183 days a year. Investing in cities in CT is a take I didn’t look at. Stamford & Greenwich & Westchester County were booming with Corporations when I graduated college in 1984. Due to high taxes for Corps in CT .. I’ve watched as they all left CT. So put someone fiscally responsible in charge of CT so this can be done. CT was 50th in fiscal responsibility last year! We WERE the richest state per capita 3 decades ago. We do need to rethink cities and opportunities I agree.
Diana-just wait a few weeks to learn more about higher taxes and more companies leaving CT.
Before the new legislation starts Wednesday, Governor Malloy has proposed:
Increasing gas taxes by 7 cents
Implanting more than 60 tolls arriving CT
$3 per tire tax in additional to sales tax and removal tax
Once the session begins we CT residents will learn of the coming deficit that will approach $2 BILLION. You can bet the cry will be to tax more-especially those living in fairfield County. It’s coming. Income tax increases and sale tax increases will be debated. Pushing the Teachers pension plan costs down to towns and cities will be debated-which will increase Westport’s property taxes.
It’s all coming. You will not have to wait much longer, the session starts in a few days.
True that our only selling point now is, well we’re STILL slightly cheaper than Westchester.. The younger generation doesn’t really care, because they would rather spend more for the house in Rye or Bronxville and have the short commute, easier access to the city, and smaller in-town home.
Living in CT these days sounds very taxing. It will take its toll on you.
several are tax cheaters. report your neighbor
Richard-Turning in your neighbor will not stop people from leaving Ct. Fixing the budget crisis will.
Shortly we will all learn that the next biannual budget is projected at a whopping $5 BILLION deficit.
FIX THE PROBLEM!! CT is in a financial death spiral-either CT residents vote to make change or the crisis accelerates. Your choice. Everyone’s choice.