California Does Not Have a Friendly Tax Climate for RetirementCalifornia has no program to attract retirees to the state, and furthermore does not a very friendly tax climate for retirement. For starters, California has high sales taxes and income taxes. Bottom line, as a retiree you will probably be worse off tax-wise retiring in California than most other states. For more information go to California Franchise Tax Board |
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Overall Tax BurdenCalifornia's state and local tax burden is 6th highest in the U.S. The Tax Foundation estimates its total tax burden at 10.5% of income, well above almost every other state. |
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Income TaxCalifornia has one of the highest maximum tax rates in the country at 10.55%. There are 7 brackets |
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PensionsPension income is not taxed as long as it doesn't come directly as dividends or income. |
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Property TaxPer capita property taxes are about average for the U.S. Proposition 13 is a good thing for retirees in that it permits revaluations only after the sale of a property. This helps protect homeowners from big swings in their taxes. |
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Sales TaxCalifornia charges 8.25% sales tax, one of the highest in the nation. Towns are permitted to add an additional 1.5% sales tax. Gasoline taxes are the second highest in the nation. Cigarette taxes are lower than average. |
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