How much taxes would we save if we moved from MoCo to Fairfax County?

[Anonymous]

I'm trying to figure out how much we would save if we moved across the river. Our HHI is $ 400k.

Could anybody please tell me if my calculations are correct?

So far I've gathered the following tax rates applicable to our situation (please correct me if I am wrong):

VA:
VA income tax: 5,75 %
Fairfax County income tax: none
Fairfax County real estate tax: 1,075 %
Fairfax County property tax on cars: 4,57 %
Sales tax: 5 %

MD:
MD income tax: 5 %
Montgomery County income tax: 3,20 %
Montgomery County real estate tax: 0,724 %
Montgomery County property tax on cars: 1,81 %
Sales tax: 6 %

Am I missing something else?

So, provided that we drive cheap old cars, the only noticeable difference is the MoCo income tax of $ 3.20%, right? So in our case that would roughly translate to $ 12k per year.

Is it really true that Fairfax County does not have an income tax at all? Do the various cities like Great Falls, McLean, Falls Church, levy their own taxes?

Thanks much in advance.

[Anonymous]

there are incorporated cities in Fairfax county (parts of Falls church, Herndon, etc). not all parts of these towns are the the "Township" and I think the taxes are pretty minor if there are any, from what I remember.

OP, why do you care, really? your calculation looks about right, but moving across state lines has larger implications than just the tax savings. (school choice, commute, location and neighborhood, etc.)

[Anonymous]

Well, the real estate tax will probably make 2-3k difference assuming you buy the same price house. Also, state taxes are deductible so you would save some on federal taxes (3-4k?). Might be 6-7k net difference but perhaps I'm missing something. I know the AMT plays havoc with my guesses.

Personally I'd pony up for each of the state versions of turbo tax and run them both to see how much difference there would be.

[Anonymous]

Just from your numbers, with VA income tax higher by 0.75%, that means that the income tax difference is only 2.45%, not the full 3.2% which makes it closer to 9800 (as opposed to $12800) for your income.

Also, you'll be paying 0.35% higher real estate taxes. For a $1M house that's $3500 per year more in VA. If your house is only $750K then that's still $2625 to cut to income tax difference. Then the property tax on the cars. Even with cheap old cars, you still have to pay the tax on the estimated blue book value of the car. So if your old car is worth $2K then they'll still charge you the $91.40 of taxes on the old car.

As another PP pointed out, once the dust settles, you're talking about just over 1% of your income. I bet that there are a lot more important issues than the taxes when it comes to whether or not you want to move to Fairfax.

[Anonymous]

VA has better schools and more premium places with good schools. Also the assessments for houses are different , no matter what the same size house and price will have much lower taxes in virginia. If you are liberal please don't move here we have enough of those messing up va and eventually you will need to move more south for lower taxes.

[Anonymous]

Anonymous wrote:VA has better schools and more premium places with good schools. Also the assessments for houses are different , no matter what the same size house and price will have much lower taxes in virginia. If you are liberal please don't move here we have enough of those messing up va and eventually you will need to move more south for lower taxes.

OP here. Why, I thought you people are all for diversity!

[Anonymous]

There is sales tax on groceries in Virginia but not in Maryland.

[Anonymous]

We live in Fairfax County (in the Town of Vienna). There is no local (county or town) income tax.

[Anonymous]

What happened to the hated car tax in VA?

[Anonymous]

There isn't a Montgomery County property tax on cars that I am aware of. We have 3 cars registered here and do not pay any kind of annual assessment (unless you are talking about a sales tax on cars, but that's only when you purchase a car.).

[Anonymous]

Anonymous wrote:We live in Fairfax County (in the Town of Vienna). There is no local (county or town) income tax.

There is, however, a Town of Vienna real estate tax. Paid an extra $875 this year, in addition to the real property tax paid to Fairfax county.

[Anonymous]

Anonymous wrote:
Personally I'd pony up for each of the state versions of turbo tax and run them both to see how much difference there would be.

Great Idea! OP, this is probably your best tool with which to make your comparisons.

[Anonymous]

Anonymous wrote:

Anonymous wrote:
Personally I'd pony up for each of the state versions of turbo tax and run them both to see how much difference there would be.

Great Idea! OP, this is probably your best tool with which to make your comparisons.

Except turbotax only does income tax, not real estate tax, or car tax or the other things that balance the income tax out (and you might need to have an exact address to know what your taxes are).

[Anonymous]

There's no property tax on cars in MoCo.

[Anonymous]

MD income tax is as high as 5.75% for income over 300k (joint filer).