States Lower Taxes to Court Retirees

Maryland is known as the Free State, reflecting its tradition of political freedom and religious tolerance, along with its resistance to Prohibition. Talk to retirees, though, and they'll tell you the nickname is a misnomer, at least as far as taxes are concerned. While Maryland excludes from taxes up to $31,100 in income from pensions and 401(k) plans, state and local taxes on other types of income--including distributions from IRAs--can run as high as 9%.

Fortunately for Marylanders willing to relocate, a number of other states give. Alternatively, Marylanders can join the thousands of retirees that have stowed their snow shovels and moved to Florida, which has no income tax and is on .