Family. Good health care. A warm climate. Low crime. A reasonable cost of living. All are important in picking a place to retire, financial planners say. But taxes can be a factor, too.

The book “America’s Best Low-Tax Retirement Towns” ranks 163 U.S. cities according to what retirees pay in taxes. Authors Eve Evans and Richard Fox identified “tax heavens” to consider, and “tax hells” to avoid, in choosing a retirement city.

Evans says retirees on fixed incomes want to settle where state and local taxes take only a nibble out of their Social Security, pensions and savings.

“Where you retire can have a big impact on the check you write to the tax collector,” the Houston author says.

With 78 million baby boomers approaching retirement age and in an era of growing affluence and mobility, experts on aging expect the number of retirees who relocate to increase substantially. Financial planners say many people base their decisions mainly on lifestyle – perhaps a desire to be near mountains or a lake – but that taxes may help them choose among their favorites.

Bryan Clintsman, a certified financial planner in Southlake, Texas, recalls a client looking ahead to retirement who asked him to prepare a cost-of-living analysis of five states. “He was going to have a large pension and was planning to build his dream house in one of the states, so taxes were a consideration,” Clintsman says. On the basis of the research, the man selected Arizona.

Not everyone is likely to be so analytical, Clintsman says, but taxes are worth considering. When prospective retirees begin thinking of tax heavens and hells, financial planners and retirement specialists offer these tips:

Do not think of just state income taxes. Even states with income taxes may not be as burdensome as they first seem.

“States without broad-based income taxes aren’t necessarily the cheapest places to live,” cautions Tom Wetzel, president of the Retirement Living Information Center, which helps retirees with their relocation decisions. “States without income taxes find other ways to raise their revenue. You need to consider your entire tax burden. No income taxes usually mean higher property and sales taxes.”

Wetzel points out that 26 of the 41 states with broad-based income taxes do not tax Social Security benefits. Some states also exempt various kinds of pension income – private, military, federal civil service, and state and local government.

And do not forget that once you are retired, your income is likely to drop, so you will not be in as high a tax bracket as during your working years.

Remember that sales taxes can add up.

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All but five states collect sales taxes. And in most of those, individual communities add a penny or more to the basic state rate.

Sometimes, the add-ons are significant. As an example, Wetzel points to Louisiana, where the state rate is only 4 percent, but the overall sales tax rate in some locations reaches 9.5 percent.

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Look closely at local property taxes.

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Tom Dwyer, a certified financial planner and senior adviser at the Financial Design Group in Addison, Texas, says his clients who are planning for retirement are increasingly worried about real estate taxes.

“They’ve been hit hard during their careers, so they don’t want to be hit again in retirement,” he says.

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Many states offer older homeowners tax breaks in the form of homestead exemptions, freezes on real estate values and deferrals of property tax payments. Most target their relief at lower-income seniors, but others base their breaks on age alone.

Retirement experts say property taxes are the wild card in determining tax burdens. They can vary so much from community to community it is difficult to generalize about any state’s tax climate.

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Wetzel advises people to check with the county tax assessor in their chosen retirement destination to find out both the overall property tax rate and the method used to assess real estate. One area may assess property much lower than its fair market value, while another is right at market. Also, ask about any tax breaks.

As an aside, financial planners note U.S. retirees moving to Mexico can expect a substantial savings on property taxes. Not only are property values lower than in many places in the United States, but real estate is taxed at less than 1 percent of its assessed value, which is determined at the time of sale.

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And then there is the hereafter to consider.

Warren Bland, author of “Retire in Style: 50 Affordable Places Across America,” says most retirees are chiefly concerned with the taxes they will pay themselves, not what their estates will pay after they are gone or what their heirs will inherit: “They’re worried about the here and now.”

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Still, Wetzel points out a number of states continue to collect estate and inheritance taxes, and those “death taxes” will affect how much you finally leave to your loved ones. Because of the diversity of the state taxes, it is smart to consult a qualified professional in estate planning.

Do your homework.

“Taxes can be quirky, so people need to do their own research,” says Bert Sperling, president of Sperling’s Best Places, which helps people compare the living costs of different cities. “Tennessee, for example, doesn’t tax earned income, but it does tax some interest and dividend income. That distinction can make a big difference for retirees with substantial assets.”

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A number of books and Web sites can help you find low-tax retirement towns. But because each recommendation is based on a particular set of circumstances that may or may not fit yours, be careful about drawing too sweeping a conclusion. Use the ratings as a guideline rather than a hard rule.

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(c) 2004, The Dallas Morning News.

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