 When you are relocating to another state for employment, you may not always have a choice of where to live. Fortunately for those relocating to the Greater Washington D.C. area, there is the choice between Virginia, D.C. and Maryland. Each of these locales offers its own benefits in terms of commuting time, community features, etc.
One consideration potential homebuyers may wish to pay attention to is the individual income tax rates in each jurisdiction. For anybody, this can be a factor in the decision of where to live, but especially in the D.C. area with the median household income way above other areas of the country. Here's a quick summary of state individual income taxes for Virginia, D.C., and Maryland. Virginia: Tax Rates: Range from 2.0% to 5.75% in 4 income brackets.
Income Brackets: Lowest $3,000; Highest $17,000
Personal Exemptions: Single $900; Married $1,800 District of Columbia: Tax Rates: Range from 4.5% to 8.7% in 3 income brackets
Income Brackets: Lowest $10,000; Highest $40,000
Personal Exemptions: Single $2,400; Married $4,800
Maryland: Tax Rates: Range from 2.0% to 4.75% in 4 income brackets
Income Brackets: Lowest $1,000; Highest $3,000
Personal Exemptions: Single $2,400; Married $4,800 Since these taxes vary widely and can make a significant difference in your take-home pay for the year, considering the implications on your personal income may be important when deciding where to live.
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