7000/T000 B ‘Subject: Ststes with ne Income Tax, Sales Tax, Tax on Retireinent Income Best & Worst States with No Income Tax i Don't assume that a state with no income tax qualifies-as a ix haven. High sales and. property taxes can more than offset the absence of an income tax. 7 z ith NaliicomeTax = ‘Alaska - Florida ~ Nevada — South Dakoia "Tatas — WAShiigiea Wyong QUE. and Tenn. tx only dividend & interest income that exceeds costfia limits.) 7 Pensions - wvens Only three states exempt virtually all retirement income (including public and private pension benefits, 401(k) and other retirement-plan distributions, and IRA withdrawals) from stato income taxes. : 3 Best States for Pensions linois ippi - Pennsylvania Pensions - Tax Hells i} Five states are particuleily tough on retirees. Not only do they fully tax most pensions and other retirement income, bit most of them also have fairly high top tax brackets ‘States for Pensions California — Connecticut Nebraska ~ Rhode Island ~ Vermont, Social Security Benefits - Tax Heavens ¥ (G8 states and the District of Columbia don't tax Social Security), " — « 36 States That Are Heaven Alabama ~ Aleska — Arizona ~ Arkansas — California ~ Delaware - Florida — Georgia — Hawaii tdaho — llinols ~ Indiana ~ Keritucky = Louisiana - Maine - Maryland — Massachusetts ~ Michigan ‘Mississippi — Nevada - New Hampshire - New, Jersey - Naw York - North Carolina — Ohio Oklahoma - Oregon ~. Penneyivania - South Carolina - South Dakota — Tennessee - Texas \Vieginia - Washingion - Wisconsin ~ Wyoming Social Security Benefits - Helis (The remaining 14 states tax Social Seculily benefts to some extent) 14 Tax Hel Colorado — Connecticut -lowa, Kanses ~ Minnesota ~ Missouri ~ Montana — Nebraska — New Mexico - North Dakota - Rhode island — Utah - Vermont - West Virginia. (Iowa will gradually phase out tts Social Security tax by 2014, starting in 2008) QESzTOCSIL XWd Ka ZS:T gToz/LT/60NYCERS has a “Death Benefit Plan 2” which includes “Post Retirement Death Benefit? (PRDB); that dicn't Cost union members a cent and in fact was completely independent of our pensions. This plan became effec- tive for TA workers in 2008. Here's how it works: Ifthe ratitee is age 60 or younger at the time of retirement, the basis for the PRDB is 8 times the 12 month's earninas preceding retirement. The benefit is 50% of the'basis if you die in the ist year oF retirement, 25% of the ‘basis If you dle in the 2nd year of retirement and 10% of the basis no matter when you die after the 2nd your Iryou rete at age 61 or older, the basis is reduced by 5% par \yeat for each year you retire over age 60 and capped at 50% of the basis if you retire at age 70 or older So let's say you retire at age 60, and the last year's earnings are $80,000. The “basis” would be $240,000, and if you die {ive years after retirement that would be $24,000 to the desig- nated beneficiary. That's not chump change. When the retiree is over age 60 at the time of retirement, the after 2nd year death benefit is based on 10% of ne age 60 value if there was a value at age 60. Since MaBSTOA mirrors __-NYCERS, the Samueisen administation-and OAcfficers fought z000/Z000 FF hard to get MaBSTOA to give OA members this benefit and in July of 2012, the MTA Board approved this PRDB retroactively. It you know of any OA Tier 4 retiree who dled prior to July 2012, you shouid let the Retirees Association know, $0 that we can check i the benefit was paid and if not, we can ty to locate any beneficiary. If you retired prior to July 2012, you should call the MTA Business Service Genter at 040-70- 0123 to make sure your beneficiaries for the PRDB are wino you want. ‘You should also always name a contingent beneficiary in ease you and the “Primary/les" die together in an accident. This ‘would avoid probate and costly attornay fees. — Norman Rosenfeld, Pension Consultant, TWU Local 100 Retirees’ Association’ QgEzIOCsI£ Ya Ka Z! 9T0z/LT/60