4.95% IL Income Tax Vs. 0% FL Income Tax. Relocate?

Discussion in 'General Insurance Agent Discussions' started by entrep1776, Jul 29, 2017.

  1. entrep1776
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    entrep1776 Well-Known Member

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    State of IL recently raised state income tax from 3.75% to 4.95%. 1.2% increase.

    State of FL has 0% state income tax.

    I'm going to take IL L&H test in August. Going to sell supplements to senior market

    I have family in Indianapolis & Ft. Myers. If I decided to move, I would most likely relocate/change residency to FL.

    I like my inexpensive IL house & rent out rooms so pretty cheap housing expenses & low property taxes. & my two 50 lb dogs like it here too. But, my parents have an empty room in FL. illegal, but would like to change my residency to FL & just have mail delivered to FL. I already spend about 6 weeks a year in FL. I do make a little W-2 income that I want/need right now that probably requires IL residency. But, it would not require very much insurance money to replace W-2 income.

    Where would be easiest place to sell to senior market anywhere in US?

    $2,500 state tax on $50,000.

    I'm not really ready to do anything tomorrow, but possibly December 31st or January 1st. & after finding out if I can make money selling insurance. But if good reason to start building insurance business in FL vs. IL.

    Pretty vague question. & I do like to do a little paralysis analysis......But also would like to be prepared if I decide to relocate.

    Appreciate constructive input.
     
  2. billyb
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    billyb Well-Known Member

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    The seniors in FL are bombarded with mail and phone calls. Tough market. I would stay in IL.
     
  3. adjusterjack
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    adjusterjack Well-Known Member

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    I'm not quite getting what you are getting at.

    If you want to relocate to FL, take up residence, and cut all your ties to IL to avoid IL income tax, that's fine. But before you do that, check out the differences in sales tax levels between IL and FL. I would think that, without an income tax, FL has to get its money from somewhere.

    But if you are planning to just manipulate mailing addresses to hide the fact that you still live in IL, well, that's tax fraud and I would caution you against that.
     
  4. LostDollar
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    LostDollar Well-Known Member

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    Or you could move to IN. Get an IN lic and out of state IL and FL lic's and work DM leads as you visit around.

    The difficulties of selling insurance in FL have been discussed at great length in many threads here.

    There will be many emotional, physical and financial costs of a move. It could be that an incremental change of less than 2% in a state income tax rate will be the least of your concerns in planning the best place for long term financial and family stability.
     
    Last edited: Aug 1, 2017
  5. entrep1776
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    entrep1776 Well-Known Member

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    Good advice not to just manipulate the mailing address. I wasn't planning to do that too much ;)

    FL sales tax is 6%. IL is 10%. FL gets lots of tourism dollars. IL is very generous with its retired state employees and other state funded programs. IL bonds are right @ junk rating these days. & IMO IL has very high state income tax & corporate tax.

    I know some agents on here do telephone sales & sell in multiple states. I'm guessing they could reside in any state they chose to. Which I'm guessing if they chose EARLY on in their insurance careers it might have helped... 5% is pretty big.

    While some agents are mainly F2F & need to be physically present in a certain state. F2F is how I plan to start.

    I'm just getting started with insurance & really can live anywhere. Although my two doggies aren't that easily relocated, but it's not like I'll have to have them change high schools. So I'm not really sure best state to work in. Hoping other agents might share experience since I know many work(ed) /lived in multiple states.

    If it's close which state I live in, I don't mind going by the letter of the law vs intent of law. My parents are healthy but getting little older, 72 & live in FL. I could conceivably spend 1/3 my time in each IL, IN, & FL. I think requirement is 50% physically present to have residency.

    I have heard FL is pretty tough senior market. I'm not sure about IL or IN.

    ----------

    Could be interesting.

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    I've heard that. Any ideas how IL compares to other states like IN? i haven't really heard or know statistics/data how to compare.
     
  6. NewbieNewbie
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    NewbieNewbie Well-Known Member

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    I love the little note where you say illegal.. but.

    If that did not change your mind then nothing else will. Good luck, I guess.
     
  7. entrep1776
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    entrep1776 Well-Known Member

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    If I spend 1/3 in IL. 1/3 in IN. & 1/3 in FL.

    Which state am I resident of?

    edit:I do consider myself very ethical. ie I report ALL my rental income. ie I reported EVERY cash Uber tip I got. BUT, i try to find EVERY possible deduction I can. ie my operating costs for my 2005 Prius were about 13 cents a mile. Mileage deduction 54 cents. I actually was making money by driving aimlessly hoping to get a pax.
     
    Last edited: Jul 30, 2017
  8. billyb
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    billyb Well-Known Member

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    Sales tax in most counties in the FL panhandle is more than 6%. I sell FE and consistently run across 3 other agents seeing the same people. I have found that most will not answer their phone unless they recognize the number so I doorknock. It is a tough way to make a living especially when it is 100 outside.

    In southern FL I would think MA is sold more than MS. May be wrong, but I can guarantee you that you won't be the only agent contacting them. Some of the top producers on the FE forum are from TN and IN. If I didn't have strong ties to this area I would consider a move.
     
  9. LostDollar
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    LostDollar Well-Known Member

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    ----- Post redone for brevity and focus :1laugh: ------

    You are asking insurance agents a hypothetical tax question which I doubt a tax accountant could answer based on information provided.
     
    Last edited: Aug 1, 2017
  10. VolAgent
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    VolAgent Well-Known Member

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    Well said, and very concise.
     

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