Teaching Tax Flow: The Podcast

This episode breaks down the latest IRS data to show exactly which states are seeing the largest influx of residents and which are experiencing the most significant exodus. We look at the numbers behind the movement to help you understand the broader financial implications of these patterns.

Texas, Florida, North Carolina, South Carolina, and Tennessee currently lead the list for growth. Conversely, California, New York, Illinois, New Jersey, and Massachusetts are seeing the most substantial population loss. By analyzing these US population shifts, we can better anticipate state tax trends that often follow such demographic changes.

Tax Foundation: https://taxfoundation.org/data/all/state/state-migration-trends-map-americans-moving-population-changes/

Defeating Taxes: https://defeatingtaxes.com

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  • (00:00) - IRS Reveals Top States for Population Migration and Tax Impact
  • (01:52) - State Income Tax and Population Migration Trends
  • (08:06) - Factors Influencing Relocation Decisions and Tax Planning
  • (10:27) - High Tax States and Migration Trends in the US
  • (17:16) - Tax Planning and State Relocation Considerations

Creators and Guests

Host
Chris Picciurro
Founder, Teaching Tax Flow
Host
John Tripolsky
VP of Marketing, Teaching Tax Flow

What is Teaching Tax Flow: The Podcast?

Welcome to “Teaching Tax Flow: The Podcast”, the show that’s all about demystifying taxes and helping you keep more of your hard-earned income in your pocket.

Hosted by tax experts from the Teaching Tax Flow team, this unfiltered (but clean) podcast is designed to empower you with the knowledge and tools you need to confidently navigate the world of taxes. We’ll cover everything from understanding tax laws and regulations to maximizing deductions and credits.

In each episode, we’ll break down a specific tax-related topic in a clear and accessible way, providing practical tips and strategies you can use to optimize your tax situation. We’ll also answer listener questions, share the mic with amazing guests, and share real-world examples to help illustrate key concepts.

Whether you’re a freelancer, small business owner, real estate investor, or just looking to understand your taxes better, this podcast is for you. So tune in, take notes, and start building your confidence in taxes today.

Produced and hosted by Teaching Tax Flow.
www.TeachingTaxFlow.com

Chris Picciurro, CPA:

Today, we are going to uncover what the IRS released earlier this year, the top five winning and losing states when it comes to population migration. And when you talk about population migration, you talk about big dollars and where those dollars are coming from and those dollars are going to within our tax system. So let's jump in. Alrighty, Chris.

John Tripolsky:

Yeah. I'm excited for this one, buddy. I know we're gonna look at those top five winners, top five losers of that state migration. So obviously, this information given to us by the IRS and the last, I would say, data pool, data set that they have. So we're gonna dive into this.

John Tripolsky:

We're gonna dive into it a little bit at a time, but also adds a bigger picture. Everybody, thank you again for joining us back here on the podcast in the Strategic Associates studio. It's gonna be a great topic, hopefully, you live in one of the winner's side already and not one of the loser's side yet. And, you know, there's time to change things if you have to. So, Chris, let me start off with this for the question for you.

John Tripolsky:

So this data was given to us by the IRS. Sure. It's a couple of years old because obviously it takes some time for them to collect all this info. So let's run through these kind of at your pace. Do you want to start with the winners or then go to the losers or you want to compare one and one and two and two?

John Tripolsky:

I'll I'll kind of let you roll with this one, buddy. We're to

Chris Picciurro, CPA:

start with the winners. And yeah, this is migration data spanning 2022 to 2023. It is the most recent information we have. The Tax Foundation, which as you know, the Teaching Tax Flow community relies on this nonprofit, bipartisan organization to collect information. And the top five states, so for when it comes to state tax migration, it's calculated based on net filers gained.

Chris Picciurro, CPA:

So how many net tax filers moved into a state for one year? And so it's only a one year span. The biggest winner is the state of Texas. Over 56,000 net filers gained in one year. The second, the state of Florida.

Chris Picciurro, CPA:

Third, North Carolina. Fourth, John, your former state of South Carolina. And then fifth, my favorite state now, the state of Tennessee. So those are your top five winners. But when we look at net filers gained, that doesn't necessarily tell you the whole story.

Chris Picciurro, CPA:

We have to look at how much adjusted gross income or AGI migrated to that state. Now, three of these four states actually have no state income tax. We're going to talk about what we feel the reasons for this migration has been. And state income tax is one of those drivers. But remember, State income tax is just one tax that you pay.

Chris Picciurro, CPA:

So the more residents the state has, the more property taxes are going to collect, the more sales tax they're going to collect, the more payroll tax they're going to collect. Collect if that person is working and potentially the more funding they're going to get. Let's say they have children and the federal government funds the the school districts to the state and the state distributes money to the school districts. So the point is dollars follow population migration when it comes to tax. So Texas number one with 56,000, about almost 500 net filers gained Florida very, very close behind, 55,349.

Chris Picciurro, CPA:

So ultimately, they're about the exact same. However, the state of Florida gained over $20,000,000,000 of adjusted gross income, where the state of Texas only gained about 5,500,000,000. So even though they had the same followers gained, Florida had four times more adjusted gross income come in. And then North Carolina was about 39,000 net tax net filers gained. Because remember, a net filer could be a a married couple, you know, and that and that sort of stuff.

Chris Picciurro, CPA:

South Carolina over 29,000, then Tennessee over 24,000. So very, very interesting. And And with

John Tripolsky:

that one, Chris, just to kinda put it in layman's terms, make sure I'm I'm understanding what you said there too. So even though Texas, right, they had they had that 56, you know, 56,000, you know, Florida. We'll call well, for a figure of speech, let's say, Texas and Florida had the the same air quotes amount of of people moving to that state, tax filers. But a huge, huge difference in the dollars that were flowing with them. Would it be safe to assume that you have much higher higher income earners moving to Florida versus other states?

John Tripolsky:

Is that kinda what that's telling us?

Chris Picciurro, CPA:

You could yeah. That that is that is definitely an something to consider. So Florida Florida netted roughly a $184,000 of adjusted gross income per new resident. So that's three to four times the next tiered average. So absolutely.

Chris Picciurro, CPA:

And and the other thing is when higher earning people move to a state, what happens? Usually, have more disposable income. There's gonna be a trickle effect because there's a whole section of people that have to move there to help serve those people. So imagine a new hospital and a or a new school or a new police station. Right?

Chris Picciurro, CPA:

So there's a big trickle effect when it comes to to that state. So, yeah, I mean, Texas had the most net filer filers gained, but definitely Florida, the most amount of income per filer. So and then this this report, I mean, this is our you know, John, we're talking at a 30,000 foot level. You can actually dive in county by county and check this out. It's absolutely fascinating.

Chris Picciurro, CPA:

I know you're going to put a link to the study in the show notes.

John Tripolsky:

Yep. Yeah. For those that wanna read through all the details, right, and really look into it. It is really it is pretty cool to look at if you think about it. Even if somebody's considering moving or heck if you, you know, maybe you move from one of the states that we're gonna talk about that were the the biggest losers, and you wanna make yourself feel better.

John Tripolsky:

Like, you may get a little had a crystal ball and you won the won the gamble. Go for it. Right? Gives you that info.

Chris Picciurro, CPA:

Right. And you're right. And this is a state by state thing. So let's let's talk about the winners real quick. Right?

Chris Picciurro, CPA:

Texas, Florida, North Carolina, South Carolina, Tennessee. What are the similarities? Many of them have no state income tax. So Texas, Florida, Tennessee have no state income tax. Many of them well, they all are actually I mean, Florida might be a or Texas might be a little bit of a stretch.

Chris Picciurro, CPA:

Now according to the Southeastern Conference Football, Texas is part of the Southeast brand. We know college football conferences are all over the place. They're all in what we would call the Sunbelt or, you know, around that Southeast area. Right? So or at least the Southeastern quadrant of the country.

Chris Picciurro, CPA:

Now, Texas is a huge state. I mean, I my we have family there, so I know it's it it could be you could drive from Michigan to Florida before you can drive across Texas, and I've done it. So I'm just saying, man, it's a big state. But but the point is, you're seeing that that thing. In your job opportunities, these states are in general considered business friendly.

Chris Picciurro, CPA:

But North Carolina and South Carolina, they do have a state income tax. However, you will see a lot of people moving from the Midwest and Northeast that want better climate. None of these states. Really are have a rough. Cold climate, I mean, it's warm, right?

Chris Picciurro, CPA:

But I know when, you know, when quite frankly, when my wife and I over twelve years ago when we were considering where we were gonna move, like any accountant, I made a spreadsheet with about a bunch of columns, and one of my spreadsheets were was inches of snow per year. And for us in the middle of Tennessee here, it was less than one inch. Now, John, you've been here in the winter sometimes. Right? We might go three, four, five years, and you live in South Carolina where you had no snow, and then all of a sudden, got six inches.

Chris Picciurro, CPA:

So it's not like you get one inch a year. It's kinda like every once in a while, you get hit.

John Tripolsky:

So It's where the spreadsheets lie to you if you don't put in all the data. Right. Well, the average was less than half

Chris Picciurro, CPA:

or less than an inch. So the point is I'm thinking better better business environment, I guess, for for bill or perceived business environment, low state income tax. There could be there could be political reasons people wanna move and climate. Right.

John Tripolsky:

So hit on those two, and I and I definitely wanna reiterate that too is, like, we're looking at this from one lens, one dataset, if you will. Right? But there's so many things that you can't measure. Right? Like, eve even when we talk about states being business friendly.

John Tripolsky:

Right? I mean, somebody might be moving to a state that who knows? You know, they're they're number one in the world for networking with health care professionals. Something. Right?

John Tripolsky:

Like, you can't really put a number on it. But, yeah, it's how all the things play together. So, really, again, Chris, by looking at this before we jump to the losers, it's super interesting again for for me to look at this and you, I'm sure as you mentioned is even though the volume of taxpayers gained may be the same, There are different types of people likely moving to certain areas, which, again, we don't we don't know exactly why. So Right. Except for the weather.

John Tripolsky:

I can guarantee that's part of it. Right?

Chris Picciurro, CPA:

So I think the weather is part of it for four of the five losers,

John Tripolsky:

for sure. Hey, everyone. Wanted to jump in for a quick minute and thank our episode sponsor, Legacy Lock. So here we are talking about tax planning. Right?

John Tripolsky:

Episode after episode, but what comes after taxes? Good question. Right? The team at Legacy Lock actually provides you with these attorney drafted estate plans at a fraction of the cost, might I add, for you. So they're merging in the technology, the experience, and getting rid of that, you know, expensive price that usually comes with that.

John Tripolsky:

Keeps people away from even getting on top of this when they know they should. So without getting too deep into the weeds, check out show notes below. Wherever you're listening or watching this on, there is a link. Click on that. Really quick form.

John Tripolsky:

Goes directly to the team at Legacy Lock. We're happy to make the introduction.

Chris Picciurro, CPA:

John, what state commonly comes up in this podcast as a very highly taxed state that we seem to chuckle about.

John Tripolsky:

It has a really long coastline on the Pacific Ocean. Right. And if if anybody lives there, we are really sorry about that, but it's not gonna change.

Chris Picciurro, CPA:

California lost over a 100,000 net filers. That is about the same that as Texas and Florida gained combined. A 100,000 PEEP net filers in one year is very significant. That was almost $12,000,000,000 of adjusted gross income. So with California tax, right, $12,000,000,000 of adjusted gross income, they're probably losing between 500,000,000 and $900,000,000 worth of tax that they were would have been collecting if someone left California.

John Tripolsky:

And, Chris, you've probably seen this, and I can say for myself a 100%. Right? And, again, this data is a few years old. I have consistently seen more and more and more and more people moving from California, and it's not an opinion. It's literally what I've seen to pretty much every state that I've visited, over the past few years.

John Tripolsky:

So I would be curious to see what this number is gonna be like when they report on '25, say 2025.

Chris Picciurro, CPA:

Right. I mean, the California I mean, it's obviously not climate. Now what California does have that a lot of people are concerned about are natural disasters. They have landslides. They have, you know, tsunamis.

Chris Picciurro, CPA:

They've got wildfires. You know, they've got a lot of different things going on. They've got a very polarized political climate and a very high cost of living. Very expensive. I've been to California twice this summer for for things, and and it's expensive.

Chris Picciurro, CPA:

It's extremely expensive. So doesn't surprise me that's number one. New York number two, almost 72,000 net filers lost. 10 just under $10,000,000,000 of adjusted gross income. Again, this these are big numbers, dollars 10,000,000,000 of adjusted gross income leaving.

Chris Picciurro, CPA:

Third, Illinois. Fourth, New Jersey. Fifth, Massachusetts. So Illinois, about 29,600. Mass New Jersey was nineteen four.

Chris Picciurro, CPA:

Massachusetts, fifteen four. So the point is they are losing significant amount of of net filers. Now, what what's really interesting, John, is Massachusetts lost almost 4,000,000,000 of adjusted gross income. New Jersey lost about 2.5, but Massachusetts lost a lot less people. So Massachusetts per departure was like a $141,000.

Chris Picciurro, CPA:

So it's it's pretty, pretty crazy.

John Tripolsky:

And I don't know if I just have my head in the clouds. I'm I'm honestly a little bit surprised by the New York one being number two just because, I mean, again, just my Really? View. I always I always have heard a lot of people moving there. But to me, right, like, think of Upstate New York and then New York City, I just figured there'd be some other ones between one and two.

John Tripolsky:

But I and really, I don't know why. I just feel like people are moving there.

Chris Picciurro, CPA:

It's interesting with New York because I went up there this summer for my son's baseball tournament at Cooperstown, and I went through Rochester, Syracuse, Utica. I know you've had family from Upstate New York. The a lot of those cities are really those downtowns decimated, for lack of a better term. And now here's the interesting thing. There is a county twist in Manhattan, right?

Chris Picciurro, CPA:

Manhattan gained more tax filers than any other county in America and still lost $922,000,000 of adjusted gross income. So basically wealthy residents left. Lower income residents arrived. The 10 biggest county losers in the country were all in California and New York. So, again, net people moved to the man Manhattan, but ridiculous amounts of tax base left.

Chris Picciurro, CPA:

So what do these have in common? Very high cost of living and tax. New York, Illinois, New Jersey, Massachusetts, very challenging winter climates. They all do. And, but yeah, there are political reasons.

Chris Picciurro, CPA:

There are socioeconomic reasons. There's a lot of reasons people leave, but the data is a data, and people are leaving, other than California, the Upper Midwest and Northeast, and going more towards the Sun Belt and Texas. So this is a challenge, you know, because especially for like something like Manhattan, right? Manhattan, you gained residence but lost almost a billion dollars of adjusted gross income. And there's a city tax in New York, by the way, on top of the state tax.

Chris Picciurro, CPA:

That puts a lot of pressure and compression onto to an area because you're relying on the more high income households to pay more tax to support the services that that state or city provides. So this is obviously putting a lot of pressure on these these folks. And I look forward, you know, I think this is going to be interesting to track this moving forward to see where people are coming and going. Just John, I'm going to leave you with one little piece of information on who was close but didn't make the list. And I challenge you, if you're listening to this or watching this, have you migrated from one state to another?

Chris Picciurro, CPA:

Or are you thinking about it? Where would you go? Right? Because there might be opportunity from some of these states that are quote unquote losers that maybe house prices are gonna go down. Maybe there's an opportunity.

Chris Picciurro, CPA:

John, you and I both migrated. But, yeah, I mean, it it's pretty crazy. As far as ranks by sheriff population, I should have mentioned this. South Carolina increased over 1% of their population in one year. Delaware went up.

John Tripolsky:

That's a lot for South Carolina. Mean, again, one of those states that they have, they have your cities, but there's a lot of rural between them. Similar to New York in

Chris Picciurro, CPA:

a sense,

John Tripolsky:

you know, some of those areas. And and Chris, I know we're gonna we're gonna touch on some topics here moving forward, you know, week over week. We're we have some really good ones, and I and I always say that, you know, not to do too much of a self promotion for ourselves, but we're coming up on that time of year where people start thinking about changes. Right? They're doing they're kinda get the planning mindset a little bit.

John Tripolsky:

You're creeping between deadlines. One have passed. One's coming up next year. So this is a great time to talk about this too. And then the other stuff that we have planned that really support this.

John Tripolsky:

Right? So and and you mentioned, not everything can be measured like we talked about. We're looking at it from one lens, but it is yeah. I guess we're all kind of taking an educated guess or guesstimate, as we always used to say, is, you know, why people are doing this. And you're right.

John Tripolsky:

You kinda take climate. You take natural disasters, politics, state tax, all this stuff. Then, you know, maybe it's

Chris Picciurro, CPA:

I mean, after Tennessee, the next two were Arizona, Georgia. So both have a state income tax, both in generally a better climate area. Arizona, obviously warmer. Georgia's part of our the Southeastern clump. I mean, Georgia borders North Carolina, South Carolina, and Tennessee and Florida.

Chris Picciurro, CPA:

You know, as far as the the two losers that fell off, quote, unquote, after Massachusetts, Maryland and Pennsylvania, they border.

John Tripolsky:

Same area.

Chris Picciurro, CPA:

Right. So we'll see what happens in the long term. And, yeah, we'd love to hear from you. So let's let's chime in and and go from there.

John Tripolsky:

Let's do it. Let's do it. And I'm just glad that I don't live in one of the loser states. So Michigan, behave yourself. Stay off that list.

John Tripolsky:

We don't expect you to get in the winner side, but for heaven's sake, stay off the losers. And that'll wrap it up for this topic. Chris, thanks again for bringing this one to the to the table for us to chat through. Again, everybody, there's some links here in the show notes for this full report from the Tax Foundation too. Lots of good stuff.

John Tripolsky:

Dive in there. As Chris mentioned, kind of gave us a little teaser into those counties. Check them out. Lots of good stuff. And almost to think about this as, you know, maybe you don't plan on moving now.

John Tripolsky:

Maybe, you know, you just did or something, but life happens, things happen. This at least changes maybe that mindset a little bit on how important it is to tax plan. Because believe it or not, you do a little tax planning, it has a lot more to do with, know, you what you just put on that. That's where you live. Be part of it too.

John Tripolsky:

So we'll see everybody back here again next week here on the podcast. Have a great week. We got a great topic lined up for you. So we'll see you next week. See you soon.

Disclosure:

The information in this podcast is educational and general in nature. It reflects the opinions of teaching tax flow and does not take into consideration the viewer's personal circumstances. It is not intended to be a substitute for individualized financial, legal, or tax advice. Consult the appropriate qualified professional prior to making any decisions. Securities are offered and supervised through Cabin Securities Inc member, FINRA SIPC.

Disclosure:

Investment advisory services are offered and supervised through Cabin Advisors LLC, an SEC registered investment advisor. Chris Picciurro is a registered representative of Cabin Securities and an investment advisor representative with Cabin Advisors LLC, Teaching Tax Flow is an independent entity and is not affiliated with Cabin Securities or Cabin Advisors.