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Can You Guess Where Financial Firms Are Going When they Flee the Northeast’s High Taxes?

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By pisaphotography @ Shutterstock.com

If you answered Palm Beach County in Florida, you’re right. When tax reform capped state and local tax deduction from federal returns, financial firms and their employees were exposed to the naked truth about the high state taxation in the Northeast. With governments in New York, Massachusetts, and Connecticut drowning in obligations, taxes aren’t coming down soon.

That’s why so many financial firms and employees are voting with their feet and heading for low tax Florida instead. Many wealthy retirees have already made this sound financial choice, and it’s no surprise to see profit-making businesses do the same. Fox Business’s Brittany De Lea reports on the exodus of firms to Florida, writing:

Forget Wall Street, financial firms are seeking warmer weather – and lower taxes– in Florida.

Hedge funds, private equity firms and wealth management offices are leaving the northeast and heading to Palm Beach County, Florida.

Kelly Smallridge, president and CEO of Palm Beach County’s Business Development Board, told FOX Business that more than 70 financial services companies have moved into Palm Beach County within the last three years. Currently, the organization is working with another 15.

“I cannot keep up with the number of companies coming in,” Smallridge said. “Some are headquarters, some of them are regional operations. Many of them, once they get here, within short order establish [Palm Beach] as their home base.”

Firms are primarily coming from three main areas – New York, Boston and Connecticut (specifically Greenwich). All of these locations were impacted by the $10,000 cap on state and local tax deductions.

Some notable names that have moved into the Palm Beach area include Paul Tudor Jones and Wexford Capital.

Because of a surge in corporate relocation interest, the Palm Beach Development Board has created a full-time department dedicated to the cause.

It doesn’t hurt that the county has a high concentration of wealth, either. There are 40 billionaire and 71,000 millionaire households, according to Smallridge. Residents also have access to three international airports and a high-speed rail, which can bring travelers straight to Miami.

If you are a retiree looking for relocation, I encourage you to examine your choices thoroughly. Read more here about choosing where to live in retirement.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West (RIP JB) and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.

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