One of the biggest debates now playing out in Springfield centers on whether Illinois should replace its flat-rate income tax with a graduated system that taxes higher income at higher rates. Democratic Gov. J.B. Pritzker recently proposed a series of rates he says would generate billions in new revenue while raising taxes only on the wealthiest 3% of Illinoisans, those reporting income of more than $250,000. Before lawmakers can take up his proposal, they must first add a question to the 2020 ballot asking voters to replace language in the state constitution that mandates a flat income tax. While Democrats control the Illinois Legislature, approval of any referendum to change the constitution requires an extraordinary majority of votes, so securing approval for Pritzker’s ballot question is far from certain. Meanwhile, interest groups representing both sides in the debate are busy trying to sway public opinion. We recently rated False a claim from a business-linked group … [Read more...] about Fact-check: Pritzker-allied group’s claim about other states’ income tax unfair
State income tax california
While Colorado Gov. Jared Polis may favor an income tax rate reduction — which he mentioned in his Jan. 10 State of the State address — state Democrats, especially those on the Senate Finance Committee, don't appear to be singing the same song.On Jan. 17, Polis, under his personal Twitter account, thanked the Republican sponsors of a bill that would lower the individual and corporate income tax rate from 4.63 percent to 4.49 percent. "Thank you, @JerrySonnenberg and @RepRodPelton, for offering tax relief for ALL Coloradans. I look forward to working with you to achieve even lower rate than 4.49%, coming up w/agreeable ways to reduce tax expenditures to ensure revenue neutrality," Polis tweeted.But Polis didn't extend that support to the hearing Tuesday on Senate Bill 55, sponsored by Republican Sen. Jerry Sonnenberg of Sterling and Republican Rep. Rod Pelton of Cheyenne Wells. No one showed up to testify in favor of it, including anyone from the Polis … [Read more...] about Senate Democrats shoot down income tax-rate cut applauded by Polis
Every year, towards the end of January, most Americans gradually start to get involved in their annual rite of Spring — beginning to prepare their IRS income tax returns. For some it’s relatively easy. For others, it’s a laborious process that can often require filing a 15 April tax extension while all the needed documentation and compilations are collected. Personally I haven’t filed my 1040 income tax package “on time” in over 20 years. Normally I file in July or August. I have a suggestion for you this year: Once you have a fair idea of approximately what your tax and deduction numbers are, take your estimated figures and plug them into the Tax Foundation tax calculator. Unlike most such guesstimating calculators, this one takes your figures and calculates your taxes two ways: 2017 IRS rules 2018 IRS rules — the new rules after the GOP’s tax reform passed It shows you how much more or … [Read more...] about Run your 2018 income through this federal income tax calculator
Is it better to live in a state with no income tax? It’s a great question to ask, especially when considering how much of our paycheck is already set aside for Uncle Sam. Seven U.S. states forgo individual income taxes as of 2018: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Residents of New Hampshire and Tennessee are also spared from handing over an extra chunk of their paycheck, though they do pay tax on dividends and income from investments. The main benefit of eliminating the individual income tax, proponents say, is that states with no income tax on residents become beacons for growth. They’re better at creating jobs and keeping a core of young, educated workers from moving to other states. The American Legislative Exchange Council reports that over the past decade the nine states without a personal income tax have consistently outperformed the nine states with the highest taxes on personal income in job creation, population growth and even … [Read more...] about Is a state with no income tax — like Washington — better or worse?
Not surprisingly for a state of nonconformists, the Legislature adjourned last week end without conforming California state income taxes to any part of the Republican-crafted federal tax law passed in December. That means the federal law won’t affect how much Californians pay in state income tax for 2018, although it could make filing tax returns more complicated for some. Those who take the new, higher standard deduction on their federal return will still be able to claim itemized deductions on their state return. Ever since the federal law passed, I’ve been getting emails from readers who thought their California income taxes would go up if the Legislature did nothing, perhaps because they’d be losing deductions without a corresponding cut in state tax rates. That could be true in some states that automatically conform to federal tax law changes unless their legislatures opt out, but California does the opposite: It does not conform to any federal changes — … [Read more...] about Relax: The federal tax law won’t raise your California income tax