#3 Least Tax Friendly State to Retire: Connecticut
State income tax (6.7%) and state sales tax (up to 7%) are just the beginning of the tax fun (sarcasm!) awaiting you in Connecticut. Real estate taxes are the second-highest in the nation, according to the Tax Foundation.
And pensions and other retirement income doesn’t get a break. As Kiplinger points out, “the state taxes a portion of Social Security benefits for single taxpayers with federal adjusted gross income of more than $50,000 and married taxpayers filing jointly with federal AGI of more than $60,000.” Then there’s taxes after death: Connecticut taxes estates valued at $2 million plus beginning at 7.2%, with a maximum rate of 12%.