Rich, Young and Restless: Hello Florida and Texas. Goodbye Michigan and Maine

The young and rich may be different from others—more money and more years enjoying it—versus other people with shorter time horizons and fewer dollars rolling in. 

These lucky few are between ages 26 to 35, earn $200,000 and up and comprise only 2% of tax returns filed. But despite this small percentage, the cohort makes up 16% of the income for this age group, according to SmartAsset, a finance technology company that looked at recent IRS migration data.

And which states and cities wouldn’t want them as residents, bringing their dollars to housing, restaurants, entertainment, fashion and beauty.

SmartAsset recently ranked states based on the net inflow of tax returns for those in this coveted group. What the results determined is that Florida and Texas gained a larger share while New York and California lost the most. Specifically, Florida saw a net gain of 2,175 high earners after tallying inflows and outflows. One incentive may be that Florida is one of nine states that doesn’t have an income tax. Same could be true of Texas, which came in second with a net of 1,909 and also doesn’t charge an income tax at the state level. As of 2022, the other states without the income tax are Alaska, Nevada, New Hampshire, South Dakota, Tennessee, Washington and Wyoming.

Despite losses, both New York and California had the highest count of young high earners of any state by a wide margin. New Jersey was third with net migration of 1,048. That state lost 2,617 high-earning tax filers two years ago in 2021 but netted 1,048 the same year. The state had the most drastic reversal of the migration trend across all age groups, the report said. Why did the young and rich leave Jersey and some other states? Typically, it is to escape the high cost of living in these areas as they seek out warmer climates and more reasonable housing.

Fourth was Colorado with net migration of 754, followed in fifth place by North Carolina with 721. Both are known for their bucolic landscapes for enjoyment as a big perk.

Washington landed in seventh place and had the youngest group. The SmartAsset analysis found that more than 13% of those making at least $200,000 run the age gamut of 26 to 35.

South Carolina rounded out the top 10 on the list, with 318 net new young high earners in the state, for a total of 95,584. Six hundred and one new tax returns were filed at this level, while 283 moved out of state. Many cite its appeal as a place with a growing great food scene, nightlife, historic charm, beaches and more.