Kiplinger

20 Great Places to Retire in Tax-Friendly States

Not to be too grim, but as you're approaching retirement, you need to think seriously about the only two certainties in this world: death and taxes. On the bright side, you can do a number of things to minimize your tax bill under the new tax law--and one potentially big tax-saving move is to move in retirement. The tax situation in every state varies and can make a big impact on any budget, particularly for people living on a fixed income. To help retirees sort through the differences, Kiplinger has mapped out a state-by-state guide to taxes, classifying each state based on its treatment of retiree finances from least tax-friendly to most tax-friendly.

We also pinpointed 50 great retirement destinations in the U.S.--one in each state--that all offer other attractive advantages for retirees, such as living costs, safety, median incomes and poverty rates for retirement-age residents, as well as residents' sense of well-being and the availability of recreational and health care facilities. These are the places to retire we picked in each of the 20 states that we've deemed either tax-friendly or most tax-friendly for retirees. They're literally all over the map, so you're bound to find at least one spot to suit your retirement lifestyle.

Huntsville, Ala.

Courtesy Huntsville/Madison County Convention & Visitors Bureau

Population: 440,230

Share of population 65+: 13.7% (U.S.: 14.5%)

Cost of Living: 4.7% below the national average

Average Income for Households 65+: $52,469 (U.S.: $53,799)

Community Score: 63.3 (U.S.: 61.9)

State's Tax Rating for Retirees: Tax Friendly

As one of the 10 Cheapest States Where You'll Want to Retire, the Heart of Dixie boasts many great spots for affordable living. And Huntsville, in northern Alabama, is one of the best. It offers all the low-cost, low-tax advantages as the rest of the state, but adds more generous incomes among retirement-age residents. The average household income for 65+ households in Alabama is $44,934.

Home to NASA's Marshall Space Flight Center, the Redstone Arsenal and the Huntsville campus of the University of Alabama, the city offers a robust economy and a highly educated population. There are plenty of cultural attractions, from a sculpture trail to a symphony orchestra, as well as opportunities for outdoor recreation (think bass fishing).

Anchorage, Alaska

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