I'm sitting on the sofa in my office, which is in Virginia. Looking out the window, I can see both Virginia and Maryland. There's an often-incorrect assumption that when you cross the bridge from Virginia into Washington, D.C., your taxes jump. The reality is much more complicated.

Income taxes, which is how we often gauge whether taxes are "high" or "low," do go up if you move into D.C. But property taxes come down. So, if you're retired, you may actually be better off in D.C.

However, D.C. has an estate tax, and Maryland has an estate and an inheritance tax, so depending on your balance sheet, you may be better off staying in Virginia. You can see how things can get complicated quickly.

From just $107.88 $24.99 for Kiplinger Personal Finance

Become a smarter, better informed investor.…