Living “off-the-grid” is something that appeals to many people as a way to get away from the fast-paced nature of today’s world. But before you make the leap, you may wonder what off-grid living would do to your finances.
Off-gridders must still pay all relevant taxes, including income tax, property tax, sales tax, excise tax and payroll tax. No matter where you go in the United States, the IRS will get their share of your income, whether you are connected to the power grid or not.
Off gridders seem to have things figured out, growing their food and livestock, powering and adding plumbing to their homes, and doing just about everything that they would need from the state. But, even if you’re not reliant on the government, you’re still a citizen. And this is just the start of your legal considerations.
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Why Do Off Gridders Have To Pay Taxes?
Providing yourself with your water and electricity doesn’t mean that you aren’t using roads, the postal service, or any number of state-provided services that you probably take for granted. And you’re paying for goods and services with US dollars. There’s simply no way to escape that.
It may not make much sense to us, and it certainly feels like we’re being cheated, considering that we’re doing all of the heavy lifting when we move off of the power grid and escape into the wilderness. We get nothing in return for our taxes. It seems outrageous to pay for services and infrastructure that you’re not using. However, you are still doing your part to reduce your carbon footprint and treat the environment with respect, so you’ve just got to accept that it’s a part of life, and you can’t escape taxes. You can save a lot of money on your utility bills, and you can live your simple lifestyle, but it’s still going to cost you.
Related reading: How much money do you need to go off-grid?
How Do Off Gridders Make Money?
If you’re thinking of going to build yourself a lovely tiny home in New Hampshire, but you live in Maryland, for example, you can’t just keep your day job and commute hundreds of miles to work every day, can you? Off-gridding is a lifestyle; it’s a throwback to a time where we didn’t work in sedentary environments, and physical labor was the order of the day.
The easiest way to make money when living off the grid, especially after workplaces have moved online since the Covid-19 pandemic began, is online. Unfortunately, depending on where you live, reliable internet connectivity may be hard to come by. Still, if you’re able to get wifi signal, there are plenty of ways to make money online, such as selling the goods you’re producing, like organic food items. In addition, many off gridders will set up stalls at their local Farmer’s market, where they’ll encounter plenty of customers looking for locally produced, ethically sourced products. And they’re willing to pay a premium price, too, especially if you have developed a stellar reputation for yourself.
Something that many off gridders like to do is to teach people how to live off the grid. But, unfortunately, off-the-grid living is not easy! And there are plenty of people out there that would be willing to pay a seasoned pro to tell them how it’s done.
And, if there’s a hiking trail or hunting spot near your off-the-grid home, you may want to consider becoming a trail guide or hunting guide as an opportunity to make some money. Others might choose to rent out a separate house on their property to tourists visiting the area.
You can also turn your off-grid home or another holding on your property into a restaurant or a building for hosting educational workshops about off-grid living. Some off-gridders also invest in ATVs or snowmobiles to rent out to hikers for a fee if they live in a spot that has exciting trails and lots of visitors.
You could even start on an off-the-grid living YouTube channel to show the world your fantastic lifestyle and how you get on with your daily tasks. Still, again, you will need decent Internet unless you’re willing to travel into town to upload your videos.
The Best States For Off-Grid Living
Leaving the city life behind requires considering several factors. And go off-the-grid regulations vary from state to state. However, deciding where to live is down to what kind of nature you’d like to live in. Do you want a warmer or colder climate? Mountains? Lakes? Both? Whatever it may be, Money Inc has found the 20 best places to live off the grid in the United States to help you decide. I think Indiana, South Dakota, Alaska, New Hampshire, and Oklahoma are your ideal choices for off-grid living, while you should probably steer clear of Maryland, New Jersey, New York, California, and Hawaii. Those are the most favorable and least favorable states regarding all kinds of restrictive regulations that will make going off the grid far harder than it used to be
Other Legal Considerations
Before you go off and buy a massive plot of land and get ready to start building your beautiful off-grid home, there is an endless list of legal considerations. If you don’t want to be paying fines or, worse yet, get put into jail, you should probably take note of the following:
It is illegal to camp on your land for more than two weeks throughout the USA. These zoning restrictions were introduced to keep people from building tent cities in vacant lots and devaluing the housing market. So that means, even if it’s on your own land, you cannot erect a tent to live in for a month while you build your home.
Every home needs to meet minimum square footage, which will vary from county to county. Most counties will require a minimum of 1000-5000 square feet for a home. So a 200-400 square fit log cabin in the middle of nowhere could be illegal for you to build. And there are also often minimum lot sizes of around 5-10 acres. In some states, you can only get lots. At the same time,20-40 acres! So make sure that you’re not just buying a tiny lot that doesn’t meet state requirements, or else you’re breaking the law.
You’re also quite lucky if you’re able to get clean water on your own, but if you need to hook up your plumbing to the city’s water, it’ll cost you about $15,000 to do so. And some counties will simply not allow you not to be hooked up onto the city’s water supply, so make sure you understand what the law states.
And even though your house is running off sustainable energy sources and you’ve installed your septic tank, there are plenty of building and safety standards that you have to comply with.
Related reading: Is it legal to disconnect your home from the electricity grid?
Disappointingly there are no common tax breaks available for living off the grid. You will also need to check your plans carefully to ensure everything you do follows legal restrictions both federally and locally. However, once that’s done you still have a remarkable amount of freedom when it comes to organising your income and making savings by growing your own food, reducing your outgoings and maybe even by monetizing your expertise.
My Off-Grid Product Recommendations
Useful Book: Off Grid Living 2022-2021 – This incredible step by step guide is a great read and gives you useful information about reaching self-sufficiency in just 30 days. Get the paperback on Amazon or read it free with a Kindle Unlimited subscription or listen to the audio version with Audible Plus membership.
Small Solar Panel Systems: Silicon Solar – This is an excellent company that offers lots of products to get you started on your solar journey. Visit Silicon Solar.
Family Water Filter: Big Berkey – For a fast, affordable water filter with no plumbing required, you can’t beat a Big Berkey gravity-fed filter like this one from Amazon.
Cleaning: Fuller Carpet Sweeper –. This carpet sweeper is an ideal way to keep your home clean without using up your energy stores on vacuuming.
Handy Knife: Gerber Serrated Paraframe – This handy all-purpose knife is lightweight and ideal for all those little jobs around your home and garden.