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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7527
Experience:  15years with H & R Block. Divisional leader, Instructor
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I am 100 percent permanently and totally disabled by the Department

Resolved Question:

I am 100 percent permanently and totally disabled by the Department of Veteran Affairs. I am also Federally Medical Retired by the US Government. My husband is Federally Medically retired. We need answers to the exemptions for Georgia, North Carolina, South Carolina and Tennessee, Can anyone break down the benefits for these for states regarding property tax, Homestead exemptions, state tax and federal retirement. We have retired very young and our trying to find our what states would put the most money in our pocket. We do not understand what a homestead exemption is. If anyone can guide us that would be great! (maybe in a language I can understand) :)
Submitted: 12 months ago.
Category: Tax
Expert:  Robin D. replied 12 months ago.

Robin D. :

Hello and thanks for trusting me to help you today. I am a tax adviser with over 15 years of experience.
First a homestead exemption allows for a lower tax on the main home of the taxpayer. In most states a person must actually occupy the home, and the home is considered their legal residence for all purposes.
Each state is a little different in what they offer and some have additional exemptions for disabled and or retired military.

Robin D. :

It is simply a benefit to pay less property tax on the home you actually live in and claim as your main home.

Robin D. :

You have listed Georgia, North Carolina, South Carolina and Tennessee as the states you are interested in.

Robin D. :

I have a great website I can give you the address to if you would rather have the full info on each state or I can just advise about the tax.

Customer:

please advise. we are not retired military but are federally retired from the US governmt,

Robin D. :

GA:
Social Security is exempt. Taxpayers who are 62 years of age or older, or permanently and totally disabled regardless of age, may be eligible for a retirement income adjustment on their Georgia tax return.
The retirement income exclusion is $35,000 if age 62 or less and permanently disable. If 65 or older, the amount is $65,000. Retirement income over the maximum adjustable amount will be taxed at the normal rate.
The homestead exemption is deducted from the assessed value (40% of the fair market value) of the home Then the millage rate is applied to arrive at the amount of ad valorem tax due.

Robin D. :

There is no inheritance tax or gift tax

Robin D. :

Tax Rate Range: Low – 1.0%; High – 6%

Robin D. :

North Carolina:
Social Security is exempt. At least $4,000 in exclusions for federal, state and local pensions (depending on dates and length of service); up to $2,000 exemption for qualified private pensions, including IRAs. Out-of-state government pensions also qualify for the $4,000 exemption.
All property, real and personal, is subject to taxation and is assessed based on 100% of appraised value. Taxes are collected by cities and counties.
There is an elderly or disabled exclusion which excludes the greater of the first $25,000 or 50% of the appraised value of the permanent residence of the qualifying owner. A qualifying owner must be at least 65 years old or be totally and permanently disabled.
Tax Rate Range: Low – 6.0%; High – 7.75%

Robin D. :

South Carolina:
Retirement income is taxed. Social Security is exempt. Under age 65, $3,000 in pension income is exempt. If you are 65 or older you may exempt $15,000 of retirement income. You can take this deduction for income received from any qualified retirement plan. If both spouses receive retirement income, each spouse is entitled to an individual deduction.
Both real and personal property are subject to tax. The market value of a legal residence and up to 5 acres of surrounding land is assessed at 4%. For homeowners 65 and older, the state’s homestead exemption allows the first $50,000 of their property’s fair market value to be exempt from local property taxes.
There is no inheritance tax or estate tax..
Tax Rate Range: Low – 3.0%; High – 7%

Robin D. :

Tennessee:
Salaries, wages, Social Security, IRAs and pension income are not taxed. A 6% tax is levied on stock dividends and interest from bonds and other obligations. The first $1,250 in taxable income received by a single filer is exempt ($2,500 for joint filers).
Tennessee does not have a homestead exemption. However, there is a property tax relief program for the elderly, disabled and veterans. This is offset by no income tax though.

There is an inheritance tax in which all real and personal property in which the decedent owned or has an interest is taxed. It ranges from 5.5% to 9.5% of the value of the property transferred at death. Spouses are exempt.

Robin D. :

That is the basics on each state and should let you have a good start on the states as they relate to taxation.

Customer:

it is very confusing. I was told that some states do not tax veterans that are permanently and totally disabled and some do not pay state tax as well. we are in South Carolina right now and I thought we are property tax exempt and are federal retirement is exempt. Is federal retirement the same as pension? I thought South Carolina exempts that too. I just want to know which state will put the most money in our pocket..

Robin D. :

Some states do not tax income (like Tenn). South Carolina allows for $3,000 in pension income to be exempt but that does not mean that all the pension is exempt.

Robin D. :

Federal retirement is not exempt from taxation.

Customer:

thank you

Robin D. :

You are most welcome.
Your positive rating is always thanks enough.

Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7527
Experience: 15years with H & R Block. Divisional leader, Instructor
Robin D. and 5 other Tax Specialists are ready to help you

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