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Recent changes to state and federal tax codes will impact how much you have to pay in retirement.
This guide will explore some changes you gotta know about if youreretired in Arizona.
Arizona Governor Katie Hobbs signed into law SB 1358 on March 29, 2024, she said.
Prior law allowed for state income tax withholding only on periodic payments or regularly scheduled payments.
This can help individuals with these assets better manage their tax payments.
That way, you wont have a big bill waiting for you in April.
However, youll have less cash in the present if you opt for state income tax withholding.
SB 1358 gives taxpayers the flexibility to opt out at any time.
It impacts the minimum age for required minimum distributions (RMDs).
For those with a hefty sum in pre-tax accounts, this could cause alarger than anticipated tax burden.
A higher RMD age isnt the only benefit the Secure 2.0 Act offers.
Jennifer Kohlbacher, director of wealth strategy atMariner, explained additional ways the new policy will affect retirees.
Under Secure 2.0, a few key provisions go into effect on Jan. 1, 2025.
With Secure 2.0 came a voluntary catch-up contribution provision.
For 2025, the catch-up limit for those ages 60-63 is $11,250.
For those still working on the side, this is a way to defer income tax on earnings.
The property will still become more desirable as more people move into the area.
However, afrozen property valueprevents property taxes from climbing higher.
Is Arizona a Good State for Retirees?
Its easy for Arizonans to wonder if their state is the best option for retirement.
Heres what DiFiglio thinks about the Grand Canyon States flexibility for retirees.
Arizona may also be a favorable state for people who havesignificant capital gainsin their retirement portfolios.
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