Kiplinger’s rates Montana as not tax friendly for retirees. I don’t agree with this.
Yes the state does tax Social Security. But it has NO sales tax. And it also has very low property tax rate.
I’d much rather have low to no sales and property tax with a high income tax than the other way around.
If you do smart planning and maximize your Social Security benefits you can minimize your income taxes significantly.
In fact, I ran two scenarios in Montana one with $50k Social Security income and $25k retirement income. The second scenario was the opposite.
The tax difference is amazing. You pay $1000s more in tax, per year, to not only the Feds but to state of Montana when you have lower Social Security and higher retirement income.
So, if you plan right, you can have little income tax, NO sales tax in Montana and very low property tax too.
If your income is low enough you can even get a $1000 credit against your property taxes as well.
How do you get your gross income low? Roth IRAs and Social Security planning.