Pennsylvania. In particular the suburbs around Philadelphia.
Philadelphia is a very large city with a great nightlife and some of the best museums in the world (when the Barnes Foundation move is finished it will probably house the best modern art in the country). There are plenty of shows to be had in the theaters here, and the Philadelphia orchestra is one of the best. The sports teams are top notch. It is in between New York and DC, with easy access to both by rail. It is an hour and a half from the Jersey beaches, some of which are very nice, and it is close to Atlantic City.
Pennsylvania has a ~3% flat tax, so the taxes are very minimal, although taxes for those who work or live in Philadelphia are significantly higher due to local taxes (it's not hard to find a place to live/work outside the city at all). Cost of living is very reasonable, especially in certain area of the suburbs. Rents/housing prices are low. If you live close to New Jersey you can even hop across the river to take advantage of their cheap gasoline.
Also, this post is filled with ignorance about Philadelphia!