Out of the total 50 states in the United States, eight states - Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming have no state income tax.
In 2020, Tennessee and New Hampshire have made amendments. Thus, by 2024, a total of 9 U.S. states will have no state income tax.
Tennessee used to tax investment income and interest but it was fully revoked on January 1, 2021.
New Hampshire currently taxes investment income and interest but is being phased out by 1% per year over a 5 year period.
It may seem ideal to move to states where you don't have to pay any income tax to save money.
Moving to these states after retirement can mean no tax on your social security benefits, pensions, and other sources of retirement income.
However, it may not be as simple as it seems. Here are important factors to look into before you decide to settle in one of these states.
States with no income tax make up for the lost revenue with other taxes including property taxes, sales taxes, fuel taxes, etc.
New Hampshire has one of the highest property tax rates in the U.S. Its revenue from property taxes in 2018 was nearly 64%. But it does not have a sales tax.
Meanwhile, Tennessee has the highest combined sales tax rate in the country at 9.55%. At a 7% sales tax rate, 60% of its tax revenue comes from sales tax.
Florida levies a sales tax rate of 6% and a combined average of 7.08%. The property tax rate is one of the highest in the country.
Washington state levies a tax of 49.4 cents per gallon on gasoline, one of the highest in the U.S.
Other reasons for states charging no income taxes could be due to increased revenue from other sources.
For instance, Alaska gets its major chunk of revenue from the oil industry in the state. Wyoming also gets significant revenue from taxes imposed on the extraction of natural resources, primarily oil.
The cost of living in the U.S is high regardless of the state. The accurate measure of how affordable a state is determined by a state's overall tax burden. The overall tax burden of a state is the percent of income paid in state and local taxes.
Even though Alaska has no state income tax and sales tax, its cost of living is very high because of its remote location.
Also, Alaska ranks 45 out of 50 in affordability rankings of the 2018 U.S. News & World Report.
However, the state's overall tax burden is only 5.16% of personal income as per WalletHub 2020 Tax Burden by State. It is the lowest of all 50 states.
Nevada has the highest overall tax burden of 8.39% among the states with no state income tax and it is at 42 ranks when it comes to affordability.
The income tax rate alone does not tell about its affordability. Higher-than-average cost of living and housing costs should also be taken into account.
Taxes alone can't be the deciding factor when deciding to move to a particular state. A lower tax bill could also mean reduced services.
Access to healthcare services and employment opportunities also need to be considered beforehand.
There can be a situation where states with higher taxes have better medical care or jobs.
There can be two scenarios.
You live in a tax-free state but earn an income in another state that levies an income tax. Or you live in a state that taxes your income but you earn income in one of the tax-free states.
In the first case, you must file a non-resident income tax return in that state even if you don't live there.
You must report your earnings from the tax-free states on your home state tax return in the second case.
Low taxes don't paint the complete picture of the living expenses and conditions of the state. Knowledge about the types of taxes you may pay in a particular state can be handy if you are tax-conscious.
You might be paying more in overall taxation in the state with no income tax than the state with an income tax.
Depending on your lifestyle and spending habits, tax payments can vary. If you don't own a property, you might not be bothered by the property tax.
It is also possible that you like the place or may want to stay close to your family regardless of the taxes. Some things do come first on your priority list.
Electronic funds transfer (EFT) is one of the commonly used methods to send money nowadays. There are various ways of making an electronic fund transfer. It includes more than online ACH transfers or wire transfers.EFT payments have become an essential part of our daily lives. From online shopping to paying bills, transferring money electronically has revolutionized how we handle financial transactions.So, EFT is a term you've probably come across and most likely have sent money by EFT but what does it really mean?In this blog, we discuss what is an EFT, different types of EFT payments, how ETFs work and its key components, benefits, and drawbacks so that you can make a wise decision on which is best for your transfer needs.What is an Electronic Fund Transfer?Electronic Funds Transfer (EFT), is a digital transfer of money through an online payment system, either between banks or people. EFT payments can be done within the same bank, or between banks.As the money transfers are all digital, there is no need for physical currency or paper checks. Because of this, EFT payments are far quicker and more accessible than other methods of sending money.As the traditional paper-intensive processes become more digitized, EFTs will continue to grow and evolve.The Key Components of EFT PaymentsTo fully grasp how an EFT works, it's essential to understand its key components. These include:Sender or OriginatorThe party or individual who initiates the electronic funds transfer. This could be a person sending money to a friend or a business paying its employees.ReceiverThe recipient of the funds receives the electronic transfer in their account. This could be an individual or a company.Financial InstitutionsBanks, credit unions, and other financial institutions play a crucial role in facilitating EFT. They serve as intermediaries that help process and complete the electronic transactions.Electronic ChannelsEFT transactions can occur through various electronic channels, including online banking, mobile apps, point-of-sale terminals, and ATMs.Payment SystemsPayment systems are the networks and protocols that enable electronic funds transfers. Some well-known payment systems include ACH (Automated Clearing House), SWIFT (Society for Worldwide Interbank Financial Telecommunication), and card payment networks like Visa and MasterCard.Types of Electronic Funds TransfersThere are several different types of Electronic Funds Transfers, each designed for specific purposes. Here are some of the most common types:Direct DepositsThis is a common form of electronic funds transfer where funds are deposited directly into a bank account. For example, direct deposit from the employer's bank account to to employee's bank account.This EFT uses an electronic funds transfer network called the automatic clearing house (ACH). The money can be transferred instantly and automatically into the receiver's bank account.The ACH system is also used for recurring payments, such as utility bills, mortgage payments, and subscription services.Wire TransfersWire transfers involve the immediate funds transfer between two banks, often used for high-value or international transactions. The electronic transfers are handled by a network of financial institutions such as the Fedwire Funds Service, Clearing House Interbank Payments System (CHIPS) in the U.S. for domestic wire transfers, or the SWIFT network or IBAN for international payments.Debit and Credit Card TransactionsWhen you use your debit or credit card for a purchase, you're essentially conducting an EFT transaction. The funds are electronically transferred from your account to the merchant's account.The cards feature 16-digit numbers across the front, along with the expiration date and the cardholder's name. Both cards are used either by swiping through a reader, but the more common methods are the chip and PIN or contactless technology.Mobile PaymentsMobile wallets like Apple Pay, Google Pay, and Samsung Pay allow you to make electronic payments using your smartphone. To make a contactless payment, you hold your smartphone up to a reader like you would a credit or debit card.Bank ATM (Automated Teller Machine)Bank ATM transactions are EFT payments that use Internet banking to move money electronically between bank accounts, deposit money, or withdraw cash. The bank-issued debit or credit card and PIN are used to make the ATM transaction. Although ATM fees are common, they are usually waived if you use an ATM that is owned and operated by the same bank that holds your bank account.How Long Does an EFT Take?EFTs are typically far speedier than any paper-based option. However, there are different types and transfer times vary.For example, certain mobile payments, and peer-to-peer payments are settled instantly. Domestic automated clearing house transactions are completed the following business day.It can take as little as one minute for a domestic wire transfer initiated using a non-bank money transfer service and destined for an account at the same financial institution. Whereas it can take three to five days for an international wire transfer to clear.What is the Cost of EFT?The cost of an electronic funds transfer varies depending on the type of transfer you select and the total amount of money you wish to send.If you own a company and need to pay an employee's salary, using direct deposits is a cost-free option for you to consider. Or you can use a debit card or a smartphone to make a contactless payment in stores without incurring any transaction fees.Benefits of EFT PaymentsEFT provides several advantages, both for individuals and businesses.Speed: EFTs are much faster than traditional paper-based methods. Money transfers are instant, making them ideal for urgent transactions.Convenience: EFTs allow you to initiate and receive transactions from the comfort of your home or anywhere with an internet connection. You don't need to visit banks or handle checks manually.Security: EFTs are generally more secure than paper-based ones. Banks and payment service providers employ encryption, multi-factor authentication, and real-time fraud detection systems to safeguard electronic transactions.Cost-effective: EFTs are less expensive for both individuals and businesses. You can save money on postage, check printing, and transportation costs associated with paper checks.24/7 Availability: EFT systems are available 24/7, allowing you to make transactions at any time.Drawbacks of EFTsInternational wire transfers, which are a type of EFT, can be costly considering there are charges for sending and receiving money, including correspondent bank fees, and other penalties, such as investigation fees, in the event that the wire transfer is misplaced.Wire transfers are irreversible once sent. Any funds that were sent to the wrong person by mistake or at the request of a fraudster cannot be recovered.EFTs are vulnerable to fraud, hacking, and identity theft. It's essential to take precautions to protect your financial information. This includes regularly monitoring your accounts, using strong and unique passwords, and being cautious about sharing your financial details online.What is the Electronic Fund Transfer Act? (EFTA)The Electronic Funds Transfer Act (EFTA) is a federal law in the US enacted in 1978 to protect individual consumers engaging in EFTs.Guidelines and responsibilities for consumers and banks to address errors are included in the EFTA. Customers have the choice to dispute and correct inaccuracies without incurring financial penalties.In accordance with the act, banks are also required to give customers specific details on how to reduce their liability in the event that their card is lost or stolen.In light of the growing preference for electronic transfers over paper checks, customers required reassurance regarding the security of their money. This led to the development of new regulations that would enable users to safely utilize electronic fund transfer services.Alternative Money Transfer OptionsIf you are looking to transfer money overseas, there are specialized money transfer providers offering EFT services that offer overall better experiences in terms of costs, speed, convenience, and efficiency.InstaremInstarem offers seamless cross-border money transfers to more than 55 countries via its network of more than 8000 banks worldwide, with competitive exchange rates and low fees. Their user-friendly platform ensures swift and secure transactions for individuals and businesses alike.WiseWise revolutionizes international transfers by providing transparency, real exchange rates, and minimal fees. Users can trust Wise for cost-effective and efficient cross-border transactions. Additionally, Wise offers a multicurrency account that lets you keep more than 50 different currencies and convert them at an affordable rate.RemitlyRemitly focuses on fast and affordable money transfers, catering to the needs of expatriates and those supporting loved ones abroad. Remitly provides two-speed options for money transfers: Express ensures immediate delivery with higher fees while Economy delivers funds in 3 to 5 business days.XEXE is a trusted currency converter and money transfer platform, providing real-time exchange rates and tools for individuals and businesses to make informed financial decisions in the global market. It offers international money transfers in 139 currencies to over 220 countries and territories.PandaremitPandaremit stands out for its user-friendly interface and competitive rates in the remittance market. It's a reliable choice for individuals seeking convenient and efficient international money transfers. Transfers can be completed in as little as 2 minutes, and a 100% satisfaction guarantee ensures a full refund if expectations aren't met.AboundAbound, previously named Times Club and affiliated with the Times of India group, serves as a rewards and remittance app tailored for Non-Resident Indians (NRIs). Abound enables the transfer of funds from the U.S. to India with attractive exchange rates, providing cashback and rewards. You get competitive exchange rates and no transfer fees when sending money to over 130 Indian banks from the U.S.PomeloPomelo introduces a fresh approach to seamless money transfers from the U.S. to the Philippines, integrating consumer credit with international remittance services. It offers a Family plan for global credit sharing, delivering individual cards within 10 days. Users can send money now, pay later at zero APR, and control card balances monthly at a competitive USD to PHP exchange rate.SBICFor fast money transfers from the United States to India, consider SBIC (State Bank of India-California), a subsidiary of India's State Bank of India. As a full-service bank with multiple California branches, SBIC provides various financial solutions and international services. Key features include zero-cost transfers to any Indian bank within hours, competitive USD to INR exchange rates, and flexible transfer options through the SBIC Mobile App, online, or in-person.PlacidPlacid offers a comprehensive platform for international money transfers, focusing on speed and security. It streamlines currency exchange across 25+ countries through direct affiliations with various banks. It ensures rapid transfers, allowing recipients to receive funds directly in their bank accounts or through convenient cash pickup at local agents. Notably, their spotCash! service distinguishes itself with speed, simplicity, and convenience for recipients.PassToPassto stands out for its commitment to providing cost-effective and reliable international money transfer services. It caters to expats in the UK, offering a mid-market exchange rate and transparent fees, facilitating money transfers to 60 countries and real-time airtime top-ups to 150+ countries. Users can PassTo Plus Points with each transfer, which is redeemable for fee discounts on future transactions.ConclusionElectronic Funds Transfer has revolutionized the way we handle financial transactions, providing convenience, speed, and security. EFTs continue to evolve as technology advances. The future of EFT holds the promise of even greater convenience and efficiency.As we have discussed in the blog, there are various specialized services for a seamless and efficient global money transfer. Explore these options to make informed decisions based on your specific transfer needs.To compare your options for international money transfers, use CompareRemit's comparison tool and find a provider that best fits your money transfer needs!
As the joyous festival of Diwali approaches, the spirit of giving and connecting with loved ones in India is more vibrant than ever. To help you make the most of this Diwali season, we've compiled an exclusive guide to the Diwali 2023 offers from some of the leading money transfer companies featured on our platform. With CompareRemit's powerful comparison tool, you can easily compare and contrast live exchange rates, ensuring that you find the best deal for sending money home during this festive season.We have searched across multiple money transfer companies to find the best Diwali deals for you and put them all in one place! Check back with this article regularly as we update the deals available this Diwali season. SBIC Diwali Remittance Offer: Illuminate Lives with Exclusive Rates!State Bank of India (California) is dedicated to making your Diwali celebrations brighter and more special than ever before. Introducing the SBIC Diwali Remittance Offer, where you can send money to India and receive an exclusive exchange rate benefit of 20 paisa higher than SBIC’s regular base exchange rate! This offer is valid for a limited period only, from November 1 to November 16, 2023. To avail this exclusive offer and send your Diwali Remittance, visit SBIC's official website. Terms and conditions apply.ICICI Money2India Diwali Offer: Catch the Money2India Offer and Enjoy Cricket on Sling TV!ICICI Money2India is adding excitement to your Diwali by offering a fantastic deal. Register and transact with Money2India using the promo code WORLDCUP60 before November 30, 2023, to enjoy 1 month of cricket on Sling TV and get an exchange rate that's 60 paise better on your first transfer. New customers will also receive a $10 Sling Gift Card via email upon the successful completion of their first transaction.Explore More Offers Beyond Diwali DealsWhile not every money transfer company is running Diwali-specific promotions, several are still offering great deals this festive season:Instarem Money Transfer: New customers can take advantage of special rates and zero fees on their first transfer up to USD 500 with Instarem.Western Union: Enjoy zero fees on your first transfer.Ria Money Transfer: Use the promo code HELLORIA at checkout for a $0 fee on your first transfer with Ria.Keep an eye on this article as we actively update it with new offers that emerge during the Diwali season. With CompareRemit’s comparison tool and these exclusive Diwali offers, you can navigate the festive season with confidence, finding the best deal that suits your needs. Wishing you a radiant and prosperous Diwali filled with love and happiness!
As the Diwali season approaches, families and friends eagerly anticipate the festivities, which often involve exchanging gifts and sharing the joy of the occasion. For many, Diwali is a time to connect with loved ones, even if they are miles away. Sending money home becomes an essential part of this celebration, ensuring that the spirit of Diwali reaches every corner of the globe. In this article, we will explore the significance of Diwali, its key dates, and the best ways to send money home for Diwali 2023.What is Diwali and Why is it Celebrated?Diwali, often referred to as the "Festival of Lights," or Deepavali, is a Hindu festival that signifies the triumph of light over darkness and good over evil. It usually spans five days of festivities, with each day holding unique rituals and celebrations. Diwali typically falls between late October and early November, depending on the lunar calendar.People decorate their homes with oil lamps, or diyas, light fireworks, exchange gifts, and enjoy festive meals with family and friends. This makes Diwali the perfect season for NRIs to find the best way to send money home to their loved ones back in India. Key Dates for Diwali 2023:Dhanteras: November 10, 2023The first day of Diwali, dedicated to the worship of Lord Dhanvantari (the physician of the gods) and goddess Lakshmi. People buy gold, silver, and utensils on this day.Naraka Chaturdashi (Choti Diwali): November 11, 2023On this day, Lord Krishna defeated the demon Narakasura, signifying the victory of good over evil. It's a day of cleansing and lighting lamps.Diwali (Main Day): November 12, 2023The most important day when families come together to perform Lakshmi Puja (worship) and light oil lamps or diyas to illuminate their homes.Govardhan Puja: November 13, 2023A day to worship Lord Krishna, who lifted the Govardhan Hill to protect the villagers from torrential rain.Bhai Dooj: November 14, 2023A day to celebrate the beautiful bond between brothers and sisters, with sisters applying tilak on their brothers' foreheads.Sending Money Home for DiwaliWith the significance of Diwali in mind, sending money home to your loved ones becomes an essential part of the celebration, allowing them to purchase gifts, sweets, and other essentials for the festivities. Here are some of the best ways to send money for Diwali 2023:01 Online Remittance ServicesOnline remittance services such as Wise, Instarem, Abound, Xe Money Transfer, PandaRemit, etc. offer a convenient and secure way to send money internationally. They provide competitive exchange rates and multiple payout options, ensuring your loved ones receive the funds quickly.To find which money transfer service is the best one for you, check out our catalog of reviews and guides, all designed to help you see the complete ins and outs of the many remittance services on the market to make the best decision for your needs. We invite you to compare remittance providers using CompareRemit’s comparison tool today to find the best rates, lowest fees, and fastest turnaround times for your specific destination and transfer amount.02 Mobile WalletsMany countries now have mobile wallet services that allow you to send money directly to your family's mobile wallets. It's a fast and cost-effective way to send funds and enables your loved ones to make digital transactions easily.03 Bank TransfersMany traditional banks now offer money transfer services, especially for NRIs. Companies such as ICICI, SBIC, etc. remain a reliable option to get money home this Diwali season. However, they may involve higher fees and longer processing times compared to online remittance services or mobile wallets.04 Gift Cards and E-VouchersConsider sending electronic gift cards or e-vouchers for popular online retailers. This allows your loved ones to choose their own Diwali gifts and make the most of the festive discounts.ConclusionDiwali is a time of joy, togetherness, and celebration. Sending money home for Diwali 2023 is a thoughtful way to ensure your loved ones can fully embrace the spirit of the festival. With various options available, choose the one that suits your preferences and budget, and make this Diwali a memorable one for your family.For all of your money transfer needs, visit our homepage for more information on how to find the best option for you and your family this Diwali. Here you will be able to compare exchange rates between the top remittance companies, find the best rates, learn how to get started, receive exclusive offers, and more. This Diwali, light up not only your homes but also the lives of your dear ones with the gift of love and prosperity.
Download Our Free App
Try our faster, enhanced mobile app for a better experience