GRAY — Tennessee Lt. Gov. Ron Ramsey told a Realtors group Monday of his plans to eliminate the state’s Hall Income Tax on investment income for those 65 years old and older.
“If you think we’re retirement-friendly now, wait until we do that,” Ramsey, R-Blountville, said of killing the Hall Income Tax at the annual Northeast Tennessee Association of Realtors (NETAR) legislative luncheon.
The Hall Income Tax, enacted in 1929, has exemptions for people over 65 with total income less than $16,200 for a single filer or $27,000 for a joint filer.
Ramsey, who owns and operates a real estate and auction company, said the 6 percent tax “shocks” retirees when they move to Tennessee.
“When they start drawing out their 401(k)s, they have to pay income tax on that. That’s wrong,” Ramsey said. “We want people to save for their retirement, put some money back ... be responsible and have this nest egg built up so they don’t have to live on Social Security.
“We want more people to retire here and buy a house. I’m a Realtor. I get this. ... You would be shocked at the number of people who live in Tennessee but they reside in Florida. Now those people can move back.”
NETAR members liked what they heard from Ramsey, who also reminded them lawmakers are phasing out the state inheritance tax over the next three years.
The exemption level will be lifted to $1.25 million in 2013, $2 million in 2014 and $5 million in 2015.
“The death tax is going away due to the legislative leadership in this room,” Tennessee Association of Realtors (TAR) general counsel and lobbyist Russ Farrar told NETAR members.
Farrar said local lawmakers have stood behind Realtors in tough times and encouraged NETAR members to give money to TAR’s political action committee.
“You don’t want these people who are casting votes on your behalf to only hear from you when you have something bad to say,” Farrar advised. “It’s a two-way street. We need to be supportive of our friends who are supportive of us.”
None of the bills TAR opposed were passed by the legislature, Farrar said.
In particular, legislation requiring residential energy audits died, and an amended bill made it harder for local governments to mandate sprinkler systems in new homes, according to Farrar.
“We don’t need anything that is going to slow down sales now,” he said.
In Northeast Tennessee, monthly home sales have increased for three straight months. The average year-to-date price, $136,945, is 16.2 percent better than during the first four months of 2011, according to NETAR.
“The cumulative effect of job growth, low interest rates, bargain home prices and an improving economy is giving buyers more confidence,” NETAR President Clarissa Brown said.
While also supporting home ownership, Ramsey reiterated his goal is to make Tennessee the No. 1 state in the nation to own or operate a business.
“When I look at what other states are going through right now, I like to say ‘We in Tennessee are an island of sanity in a nation that has gone crazy,’ ” Ramsey said. “...We can’t control what goes on the national level, and frankly everything they do on a national level affects us one way or another, whether it’s the huge deficit they are running up ... or pushing stuff down small business, like Obamacare (the health care reform law).”
For more about NETAR go to www.ne? tartn.org? .
For more about TAR go to www.tarnet.com? .