An annual study that looks at the cities with the best tax rates for retirees places the City Worth While in its top three in Missouri.

New York based financial technologies company SmartAsset ranked St. Joseph #3 in the state based on a “retirement tax friendliness index” that is calculated by looking at income, sales and property tax, as well as whether or not social security is taxed.

Battlefield, Missouri, and St. Robert, Missouri, were rated first and second, respectively.

The calculations were done by looking at how taxes would affect a retiree with an income of $50,000 per year, receiving $15,000 from social security, $10,000 from a private pension, $10,000 in wages and $15,000 from a 401(k) or IRA type savings account.

In St. Joseph, the study found that this theoretical retiree would pay $7,531 in income tax, $628 in sales tax, $246 in fuel tax and would be taxed with .94% property tax rate.

“We calculated the effective property tax rate by dividing median property tax paid by median home value for each city,” their website states. “In order to determine sales tax burden, we estimated that 35% of take-home (after-tax) pay is spent on taxable goods. We multiplied the average sales tax rate for a city by the household income after subtracting income tax. This product is then multiplied by 35% to estimate the sales tax paid.”

Kyle Kordes, a senior tax specialist with H&R Block, said that while social security is taxed for the working, the benefit of not having to pay those taxes after retirement in Missouri can also contribute to local tax friendliness.

“A lot of people that are drawing social security find that at least part of that income, if not all of it, is protected from being taxed. That could be considered an advantage over someone who is still working,” Kordes said.

He said the state is typically easier on taxes than neighboring states.

“Missouri has a lot of exemption opportunities for retirement in general depending on your income level,” Kordes said.

Kordes said Missouri sometimes allows for a deduction for health insurance that the federal government doesn’t allow for.

Truman Hardy, a local CPA, agreed with that statement and said that St. Joseph may be more like the third best place for tax friendliness in the region due to lower tax rates.

SmartAsset found that Missouri is above the national average for sales tax but has relatively low property taxes.

“Missouri is moderately tax-friendly for retirees,” their online findings state. “Social Security retirement income is fully exempt for seniors earning less than $85,000 per year, if filing single, and $100,000 per year, if filing jointly.”

Mayor Bill McMurray, who is retired, said that he considers St. Joseph to be a very retirement-friendly community.

“I’ve lived here all my life, so of course I like it, for that reason. We don’t have excessive taxes,” McMurray said.

He said other benefits in the community, such as a low cost of living and short drive times, also contribute to a reasonably inexpensive retirement life in the city.

St. Joseph was rated a 50.32 on the retirement tax friendliness index. St. Robert, Missouri, which was given the top spot, was rated 52.77 and Battlefield, Missouri, was given a 50.56.

The state’s largest city, St. Louis, came in seventh and was rated a 49.53.

Brendan Welch can be reached at Follow him on Twitter: @SJNPWelch.