How the Tax Code Shapes Your Decision to Move States

Episode 88 of The Tax Policy Podcast with Fexingo looks at how state income tax rates influence where people choose to live and work. Lucas and Luna dig into new migration data from the Internal Revenue Service covering 2023 and 2024 filings, showing a net outflow from high-tax states like New York and California to no-income-tax states like Florida and Texas. They discuss the concept of 'tax elasticity of migration' with a specific example: a hypothetical software engineer earning $180,000 who would save over $10,000 annually by moving from New York to Florida. But Lucas pushes back on the simple narrative, noting that the same IRS data reveals many high-earners stay put due to family ties, job clusters, and housing costs. The hosts also explore how the 2017 Tax Cuts and Jobs Act's cap on state and local tax deductions accelerated the trend. Listeners will come away understanding the real weight of taxes in relocation decisions versus other personal and economic factors. #StateTax #MigrationPatterns #IncomeTax #IRSData #NewYork #California #Florida #Texas #SALToductionCap #TaxCutsAndJobsAct #RelocationDecision #HighEarners #TaxElasticity #Economics #TaxPolicy #FexingoBusiness #BusinessPodcast #LucasAndLuna Keep every episode free: buymeacoffee.com/fexingo