By Bill Lyons | Published on January 20, 2022
TABLE OF CONTENTS

    Where we live has been dictated by where we can find a good job. That truism has defined much of where Americans reside — clustered in and around lucrative job markets.  Working remotely isn’t just another perk in a benefits package, it’s the opportunity to move freely and still continue the same career, ideally with the same company and same pay.  One reason people are seeking remote positions after the pandemic is to have the ability to relocate to less expensive, less populated areas. 

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    America’s “superstar cities” are lucrative labor markets — but the price of entry has become the outlandish price of housing expenses. The prices of shelter have skyrocketed in these places, because supply has been diminished due to the lack of inventory in the real estate market.

    According to a recent study from the moving company United Van Lines, fewer people were moving due to jobs, perhaps due to the increasing prevalence of remote work.  Less than a third of Americans moved for a new job or transfer last year, whereas that rate was greater than 60% back in 2015.  The moving company’s 45th annual report on customers’ migration patterns found that nearly 32% of Americans who moved did so to be closer to family. Of the 10 states with the highest inbound move percentages, eight are among the 25 least densely populated states in the nation.

    “My company was headquartered in San Diego, and I lived in a high rise in Little Italy.  During the pandemic, it became very hard to work out of a 1500-square foot box with two dogs and a wife.  We thought it would be two weeks to a month of reducing the curve [in early 2020 when the COVID-19 lockdowns occurred] so we decided to go down to Palm Springs and rent an Airbnb for 60 days.”  Says Bill Lyons, CEO of Griffin Funding.  “I realized I could be the CEO of the company and still run it efficiently working remotely,  so we bought a house in La Quinta. But then the summer came around and we decided we aren’t built for the 120-degree scorching heat, so we started looking for somewhere not as crowded as San Diego with opposite weather.”  The Lyons’ found Lake Tahoe, and fell in love with Incline Village.  “People are super friendly.  It’s one of the most amazing places I’ve ever been.” 

    There isn’t as much appeal to pay top dollar every month for let’s say, a California rental, when you could potentially own a large home for that same amount in many other states. And when you move, you’ll take your family and your demand for services with you to those new locations, opening up opportunities for other workers, and at the same time likely lowering the amount that your income is taxed, all in the same U-Haul. 

    While people across the United States pay federal income taxes, depending on where you live, you may also be subject to state income taxes.  Among the states that do assess personal income taxes, the rates vary widely from one to the next. And there are two different ways to impose them: flat tax rates and graduated (also known as progressive) tax rates.  States with a flat tax rate collect the same percentage of income from everyone, regardless of how much they earn. On the contrary states with a gradual tax rate collect progressively higher portions of residents’ income as their earning level increases. 

    The states with the highest income tax rates all have graduated tax rates: California (13.30% top marginal tax rate), Hawaii (11% top marginal tax rate), New Jersey (10.75% top marginal tax rate). The states with the lowest income tax rates are a mix of flat tax and graduated tax rates: North Dakota (2.9% top marginal tax rate), Pennsylvania (3.07% flat tax rate), and Indiana (3.23% flat tax rate).  Taxpayers who itemize their deductions can deduct state income taxes on their federal tax returns. The Tax Cuts and Jobs Act of 2017 set a deduction limit of $10,000 ($5,000 if your filing status is married filing jointly) for state and local taxes, including income, sales, and property taxes.  Griffin Funding always recommends consulting with a tax accountant. 

    There are a total of 9 Income Tax Free States.  Griffin Funding is licensed in the bold:

    Alaska

    New Hampshire

    South Dakota

    Wyoming

    Nevada (pending)

    Washington

    Texas 

    Florida

    Tennessee

    Here’s a list of low income tax states that Griffin Funding is licensed in (that are lower than CA at 13.3%):

    AZ 8%

    CO 4.55%

    GA 6%

    ID 6.925%

    MD 5.75%

    MI 4.25%

    MT 6.9%

    VA 5.75%

    Whether you are interested in purchasing a new home for your family in another state to maximize your income or lifestyle, or use a DSCR loan to purchase a rental property with no income or tax return verification necessary, Griffin Funding has you covered!  Reach out to us today if you have any questions about financing your next home!

    Contact us online or call us at (855) 394-8288 to speak to one of our experienced loan specialists!

    Griffin Funding is licensed in: Arizona, California, Colorado, Florida, Georgia, Hawaii, Idaho, Maryland, Michigan, Montana, Tennessee, Texas, Virginia, and Washington!

    Bill Lyons

    Bill Lyons is the Founder, CEO & President of Griffin Funding. Founded in 2013, Griffin Funding is a national boutique mortgage lender focusing on delivering 5-star service to its clients. Mr. Lyons has 22 years of experience in the mortgage business. Lyons is seen as an industry leader and expert in real estate finance. Lyons has been featured in Forbes, Inc., Wall Street Journal, HousingWire, and more. As a member of the Mortgage Bankers Association, Lyons is able to keep up with important changes in the industry to deliver the most value to Griffin's clients. Under Lyons' leadership, Griffin Funding has made the Inc. 5000 fastest-growing companies list five times in its 10 years in business.