The IRS has released data for 2011 on a state-by-state basis and, as this analysis shows, Illinois is not faring well:
Illinoisans have voted with their feet. The winner? Anywhere else.
The Land of Lincoln lost head-to-head migration battles with every single state plus Washington, D.C., in tax year 2011, according to new taxpayer migration data released by the Internal Revenue Service on July 31. The 2011 tax year was the first year of Illinois’ historic income-tax hike, when the state raised the income-tax rate by 67 percent.
Illinois lost 24,000 taxpayers along with 26,000 dependents on net that year, for a total net loss of 50,000 people to other states. And when these taxpayers left, they took their incomes with them. The net loss of adjusted gross income for the state of Illinois was $2.5 billion in the 2011 tax year. Illinois’ loss of annual income jumped by $600 million from the 2010 migration data, when Illinois had a net loss of $1.9 billion.
Those who left Illinois tended to make more money than those who entered the state. The average adjusted gross income of those who left Illinois was $63,100, compared to an average adjusted gross income of $53,500 for those who moved into Illinois. So not only was Illinois losing more taxpayers than it gained, but those who left Illinois earned 18 percent more than those who came in.
However, the really shocking news from this IRS data release is the fact that Illinois lost residents to every single state plus Washington, D.C. The historical trend was for Illinois to lose people to 43 of 49 states but gain a few people from Rust Belt peers such as Michigan and Ohio, as well as New Jersey. That trend appears to have changed. Illinois hit a new low and lost people to every other place in America, with the biggest losses being to Sun Belt states and surrounding states.
The loss of taxpayers and their dependents was largely correlated with the loss of annual income. Illinois had a net loss of annual income to 40 out of 50 states plus Washington, D.C. All border states gained income from Illinois, and the top 10 recipients of Illinois earnings include large states such as Florida, California and Texas, but also neighbors such as Indiana, Wisconsin, Michigan and Missouri.
This new data release can be described as nothing other than a complete embarrassment for Illinois. It’s only possible for one state to sweep the board by losing taxpayers and their dependents to every other state, and that sorry distinction goes to Illinois. To lose people to every state is a resounding no-confidence vote in the status quo.
Do Illinois’s legislators think that the state will make up for the lost economic activity in volume? Drive more people out and replace them with an even larger number of people more likely to place demands on state and local government services? That’s not a winning formula.
I’d genuinely like to know how Speaker Madigan plans to reverse this trend. So far he’s mostly complaining that Gov. Rauner is a hard bargainer.
I think that “data shows” is bad grammar anywhere, but it in a headline gives me special woes.
Thanks.