Submitted by [deleted] t3_11rfyes in Pennsylvania
Aggravating_Foot_528 t1_jc8dk6s wrote
Places that tax 401k contributions don't tax them on the way back out. Basically makes them a state level Roth.
ProfessorDerp22 t1_jc8ewd0 wrote
Sure, assuming you plan on staying and retiring in PA.
Ancient-Ad8921 t1_jc8fjq7 wrote
Well, yes that would be the goal of a structure like that.
Aggravating_Foot_528 t1_jc8hu70 wrote
There may be a way to prove that it was taxed going into a 401k by one state so that if you move to another that taxes it on its way out it may not be taxes. That's easy enough to figure out
Edit: I was wrong. You follow the tax laws of the state you are currently in. So you can be double taxed - taxes when put in in pa and when take out elsewhere if they tax that. But also you can avoid all state taxes - work/live in Ohio and don't pay state income tax on 401k contributions, then retire to PA and take them out tax free. https://www.bogleheads.org/forum/viewtopic.php?t=215167
ell0bo t1_jc8lm0l wrote
Yes, but then you have to, you know, live in Ohio.
JennItalia269 t1_jc8p0wq wrote
And the OP called PA hell on earth….
Hashtaglibertarian t1_jcb6hsn wrote
Damn that is some shit right there. They really do screw people over in every state.
Aggravating_Foot_528 t1_jcb8ily wrote
The key is if you put all your money in in PA to move to a state where they don't tax it at all (no income tax) or IL or... Alabama? Where they don't tax it coming out of the retirement acct.
I guess it would take Congress to pass a law to harmonize the system if Congress itself constitutionally.can. I'm not sure they can because states can levy their own taxes without the federal government. Maybe the federal government could arm twist like they did with the drinking and smoking age.
Hashtaglibertarian t1_jcbph2w wrote
I couldn’t even think of a solution so props to you for even putting that together. I love solution people ☺️
BluCurry8 t1_jca8809 wrote
Or you live in a state that does not tax retirement income
BEHodge t1_jc93z4a wrote
Fuck That. I’m headed to Greece or Uruguay. Forced to live here for career for the next twenty years, I’ll be damned if I’m stuck here for my death.
69FunnyNumberGuy420 t1_jcayhb8 wrote
So mad about taxes you're moving to the third world to avoid paying them lol. That is some Facebook Grandpa All-Star stuff.
kdeltar t1_jcb9ops wrote
Greece being third world lol. My friend have you ever heard of any of the islands?
69FunnyNumberGuy420 t1_jcba737 wrote
Uruguay absolutely is.
[deleted] OP t1_jcctuue wrote
[removed]
BEHodge t1_jcayoi1 wrote
Nah, just don’t like the cold.
69FunnyNumberGuy420 t1_jcayspu wrote
Boy, do I have some good news for you about the climate here in twenty years.
hippata2023 t1_jcbaofg wrote
I can't imagine why anybody would retire in PA. The very first requirement I'm going to have of anyplace I retire to is that it can never snow.
This state's awful and being old here is just asking to slip and break a hip.
MailOrderDog t1_jcbehh1 wrote
I'm going to put my snowblower in the back of my truck and drive south until someone asks what it is. Then I'll know I've found my new home.
hippata2023 t1_jcbg10l wrote
lol I like the way you think!
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