If you’re considering retiring to somewhere with a lower cost of living than Illinois, you might want to consider the benefits of retiring in Illinois – such as taxes. At his time of year as we approach the 2021 tax deadline, taxes are on everyone’s radar! Illinois doesn’t tax social security benefits, but many other states do. If you’re getting ready to retire and deciding where to live during your retirement years, be sure to consider taxes, cost of living such as real estate, utilities and groceries, health care and access to culture and recreational facilities that matter to you.
Although Illinois and other states don’t tax social security benefits the federal government does. Federal taxes can be as high as 50% or even 85% of your annual Social Security benefit. Depending on your non-Social Security income sources and if you’re married or single:
• 50% of your annual Social Security benefit if your non-Social Security income exceeds $25,000 as a single adult or $32,000 as a married person.
• 85% of your benefit if your provisional income exceeds $34,000 if you’re single or $44,000 if you’re married
Many people are surprised to learn that Illinois is a tax-friendly state for retirees! Retirees in Illinois are not assessed a tax on any kind of retirement income. Retiring in Illinois means that almost all your retirement income is tax-exempt including social security benefits, pension income, and income from retirement saving accounts, including 401(k)s.
Estate planning isn’t only planning who will inherit your money, property and other assets after your death. Estate planning is your opportunity to make your own health care and long-term care decision if you become ill or incapacitated in the future. Estate planning is important for Baby Boomers because it maps out your end-of-life care and who can make healthcare decisions on your behalf.
Talk to your family about your estate plan, health care decisions and final wishes to your family. When a loved one becomes ill or dies, family conflict and stress are too often a result, mainly because the person did not let their family know their wishes in advance.
If you are a Baby Boomer and want to protect your loved ones after you are gone, an experienced estate planning lawyer can advise you on the best options for your situation. To talk to a qualified attorney in Chicago or Lombard, contact the Estate & Probate Legal Group at 630-864-5835. We provide legal services in Cook, Dupage, Kane, Lake, and Will counties.