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Asked 12/9/2007

Out of state government pension taxes

I relocating to Arizona in the near future. I have a state teacher's pension in Michigan. It totals $37,916 per year. I understand that all out of state government pensions are fully taxed in Arizona. I would like to know how much that retirement income tax will be. Thank you.
Connie Schreur
Arcadia,Michigan

 
 
 
 
 
Answers

Answer 1/3 - Submitted 12/12/2010

You are missing information to answer your question. You will calculate your tax by using the Arizona tax form, and making deductions, and then looking at the tax table. It may be possible depending on the deductions that you would not owe any tax.

 
 

Answer 2/3 - Submitted 12/12/2010

Hi Connie,

The state income taxes in AZ are not a flat tax, they're a progressive tax, the more you make the higher percentage you pay.

Without knowing the rest of you income, marital status, exemptions/deductions, no one can tell you exactly how much in AZ income taxes you will pay. It is a good idea to do a mock return and see the impact this move may have on your tax liability.

 
 

Answer 3/3 - Submitted 1/21/2011

The Arizona state income tax on $37,916 would put you
into the 3.36% state tax bracket. You would have to make
more than $50,000 to go into the next tax bracket.

Between $0 and $10,000 2.59% tax is $256 dollars.
Between $10,001 and $25,000 2.88% tax is $432 rounded up.
The remaining $12,915 is taxed at 3.36 per cent, that's another $432

256+432+432= $1120. Jesus that's not cheap. Correct me if I'm wrong.

 
 
 
 
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