2011 income tax hike drove wealthier Illinoisans to other states
The silent exodus of money from the state. I had asked a retiring department head the city of Peru why he was moving out of state after he took his retirement. He had a simple one word answer. TAXES.
Thousands of unknowns to Peru are leaving and the remaining have to pay the bills which are getting bigger and bigger. Peru city taxes are low but they are not the only components of your bill. There is a bill before our legislature to freeze property taxes for 2015-16 but not likely to pass due to other attachments.
29 comments:
Your comment looks to reflect of Peru. The State income tax reflects upon the State of Illinois. It helps by having low taxes in the City of Peru and the local government of Peru can and only control the city portion of your tax bills. The library board controls nearly 50% of the local city tax bill, and they are not elected. If they are leaving because of taxable income then they may locate to states without a State income tax. Be careful because you still may have a much higher city tax rate in your new location. Unless they are a retired multi-millionaire they may have very little total difference in the cost of living. It makes us wonder why a retired government employee would be worried about his millions in retirement income?
Social Security, Pensions, Military Retirement, TRS, IMRF are all free of state income tax in Illinois.
The Illinois Policy Institute is propaganda. Anyone who spews off that Illinois has higher taxes with only looking at one or two taxes and leaving the others off is a liar. We get compared to other midwestern states and they fail to mention their service taxes or the fact that they have a progressive income tax. I don't care which way you lean politically, nothing good comes from misusing data. Also of course extremely wealthy people like no income tax states because things like service and sales taxes are meaningless to them. Illinois could never be a no income tax state because we don't produce oil or have tourism like Florida.
Hearsay from Public Service meeting that the city may sell the old Public Works to Dollar Tree that wishes to build a new store at that location.
If the closed session was about the sale of property last night, it might just all tie together.
Who will pay to demolish the building, or will the "dollar tree" set up shop in a rat trap full of asbestos and PCB contaminated oil.
Lets see. Who should I believe, Michael Madigan or the Illinois Policy Institute? Hmmmmmmm... let me think about that.
The income tax in Illinois is relatively low. However, "rich" people don't necessarily have a high income, they have money that is making money, which is taxed pretty high in Illinois. Additionally, they tend to own higher end property - which Illinois taxes at a very high rate on average throughout the state. The "rich" people can afford to hedge their bet by making a residence in a place that suites their tax situation. So even if they work in Illinois, they can have all of their assets in another place.
Relying on sales tax is very regressive. "Poor" people spend almost all of their income. Therefore, they are taxed on the income itself and then again on every thing they buy. As a percentage of income, sales tax effects "rich" people less. First, most of their major purchases are made in places other than Illinois. Look around - lots of Mercedes Benzes and Cadillacs with Florida license plates.
So yes. If you are "rich" you should not call Illinois home. After all, if you are "rich" it implies that you are smart and know how to handle money. It's not smart to handle money in Illinois.
So I get a kick out of all the people in Peru saying we pay low taxes. For most people - it would cost less to pay a higher property tax to pay for the school than to buy all their stuff in Peru. Let me explain - you see, property tax for most middle income people is tax deductible. So, most middle income people raising a family, would end up paying less tax in Peru if the school (and even the Harl Road Tax) was paid for through taxing real estate. They would end up paying less in Federal Income tax and even less in State Income Tax and they would not have to pay the extra percentages on sales tax - which it is very difficult to try to deduct.
According to wallethub, Illinois ranks dead last with the highest overall rate of total taxation out of all 51 state entities (They include District of Columbia). Multiple surveys have shown that it is the state with the most dissatisfied and unhappy residents.
No matter what side of the aisle you sit on, it is clear that the state is broken. The only way to fund the legally promised pensions will be even higher taxation. There truly is no solution that will not require drastic reform, and I do not see that happening.
http://wallethub.com/edu/best-worst-states-to-be-a-taxpayer/2416/
I have been told that in a Commonwealth state such as Kentucky that all public education is free as long as you are a resident of the state,this goes as far and includes college. Think of the savings for a family.
9:44. And I've been told that if you wish hard enough, Leprechauns will ride into town on Unicorns and pass out Gold Doubloons.
The term "Commonwealth" in a State's name (there are 4 of them) has no legal meaning. The term was used in a political sense to emphasize that their government is based on the "common consent of the people" as opposed to the government that was legitimized through their earlier royal colony status which was derived from the King of Great Britain.
Your have equated the term Commonwealth to have some sort of socialist economic meaning. This is not true. Furthermore, schools in Kentucky are paid for through taxation, just like all schools. The specific tax model may be slightly different, but the taxes pay for them. Tuition is also charged. Full time college students pay between $5K and $12K per semester depending on level and discipline.
5:52 the answer is very simple. Neither!
6:27 you are so wrong. If you are a peru taxpayer of "middle income" status and you think an income tax deduction of that nature is better than a half percent difference in local sales tax then you have no idea how to do basic math. I've done the math when the tax was increased for the school and it's not even close. For the items that are taxed it is a fraction of what increasing real estate taxes would have been. This is very simple to understand because the majority of sales tax does not come from me as a primary residence. I'm not sure where you live, but the only person you could argue this harms is a renter since they don't pay real estate taxes directly. Of course They do through their rent but I say great since everyone should pay their fair share.
I am using the school tax because you can compare the difference. As for the "Harl Road tax" that's a different story because it's really hard to pin down.
If I were you I would talk to some of your friends in Spring Valley and see if they would have rather had a sales tax pay for their school or the increase in their real estate taxes. It's not even close.
I left becuase most people in the Illinois Valley are dumb un-educated and think they know what is best because I have life experience. Well, nobody wants to come to the Illinois Valley area, all we have is video poker, pull tab tickets, and well that's about it. Beer we have allot of drunks.
5:58 AM. I did the math and it works out. The property tax would have been a better option for a young family that has a mortgage and several children that are still growing.
The sales tax is a better option for an older couple with a house paid for or mostly paid for and no longer in need of outfitting children with clothing and buying all the stuff that young families need to buy.
For most people, deducting sales tax is not lucrative due to the loss of the personal exemptions. However, you can claim the exemptions AND deduct property tax.
So in many cases - paying a higher property tax costs less from a total tax point of view. The ones this does not work out for are the older people that are retired and often don't have an income tax obligation. Remember - almost all retired income is free of State Income tax in Illinois, which is a double bonus. The triple bonus is that retired people often don't spend as much as a family raising children - so sales tax does not impact them as much.
1:15 pm
Your sentence structure indicates that life experiences should have included reading and writing. And you indicated the good things about the Illinois Valley. What are the bad things?
My, aren't you the elitist one Miss 2:53. I bet you are one of those SUV Driving "School 'Marms" living life large on the back of the tax payers.
4:27, my aren't you thin skinned, you like to dish it but can't take it
People with kids don't pay taxes.
1:48, your argument falls apart when you take into account that a married couple with children does not pay income tax unless they are very wealthy. Further compounding the math problem is that senior citizens don't pay income tax unless they are very wealthy.
Way to many special interest group loopholes in the income tax laws to make a viable comparison.
Not the topic - but the only way to fix the income tax system is to have a 100% flat tax - 5% across the board on all "earned income" - no forms to file unless you are self employed. 5% and that is it - no deductions and no tax on investment income.
Many people get more money back on income tax then they paid in. All it takes is a couple of kids and you thousands of dollars in "credits" that can be refunded. Crazy system.
I haven't actually paid income tax in years. If you game the system correctly, you take common every day expenses and deduct them from income. For example, if you call yourself a Consultant and open a "Consulting Firm" - you can have a new car and all the gas you need with the costs deducted from your "income." The key is to have all your expenses take up all your income so you never actually pay taxes, but you get all the stuff you need paid for. Like tickets to the Cubs Game become "entertainment". A new suite at Bergner's is necessary to lobby a Senator, so it becomes "work cloths".
Yup, then you can also get "extra" compensation from one client to handle these expenses while writing it off for income from another client. Just have to find the one dumb enough to give you almost $3.00 a mile for driving to "the Burbs."
It sounds like nobody actual pays income tax except for me. I pay in over $12,000 a year in Federal alone. Haven't seen a "refund" in many years - usually have to send in an extra grand. It really sucks to be honest and live within your means.
I think 11:17 is being coy and referring to a certain lobbyist/economic development director who bought clothes at Bergners and we taxpayers paid it the clothes because he turned them in on his expense account.
7:45
Another ridiculous lie ...... This is come to the point that anything posted has no validity at all. Why and who comes up with stuff like clothes being bought at Bergner's?
10:31 AM
You are wrong we paid for Vickery's shirts from Bergners when he did his Navy Pier gig and evidently he traveled somewhere else where he needed new shirts. All the information about expenses have been foia'd and available to the general public. Geez you would think he could foot some of his own expenditures for things like that.
10:31, just look in the city of Peru reports. We also gave him millage equaling $2.64 a mile when the federal limit is 57.5 cents per mile.
10:31 If you think these truths are lies then foia the information for yourself and you will be surprised at what you will learn - THE TRUTH!
10:41 proof is in the evidence. You have not posted anything but your rumors.
3:02 PM
So now you believe the city clerks office sends out rumors and the disbursements put out by the city are all rumors and lies, you must be one of those who believe black is white and white is black or call it red/blue. Really you make me laugh.
I really hope you are not part of our city government because that is very scarey.
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