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Illinois one of 13 states with higher taxes.
Summary and audio linked here.
Chicago’s political leadership is floating a pension buyout program as evidence it is seriously addressing the city’s thirty-six-billion-dollar unfunded pension liability, but Mark Glennon, founder of the Illinois policy research organization Wirepoints, said that the proposal moves debt from one column to another rather than reducing it, and that the broader fiscal picture facing the city continues to deteriorate across every measurable dimension. Audio here.
Expect no retraction or apology. This what they do.
The state’s existing buyout program for its own pensions is the precedent for Chicago, which should be a warning: Look out for similar exaggerated claims and shoddy analysis.
Full interview and summary linked here.
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Pay higher and higher taxes in Taxistan for this?!!
Chicago alderman furious with ‘pure bull—-‘ as city’s murder rate still exploding | Fox News
Saving $10K year in property taxes alone by moving to SC vs DuPage county. Also 7% sales tax vs 10% in IL and much lower gas taxes, about $.75/ gal less. And as you see in chart lower state tax rates. No brainer. Fools in IL under delusion it’s great place to live.
The problem is pension/retirement funds are taxed in South Carolina where they aren’t in Illinois. A couple that each have a pension (or properly funded IRA) would pay a large income tax bill. Saving 10k to pay 16k more in income taxes doesn’t appeal to me and other successful retirees. Not to mention once RMDs kick in. Illinois isn’t ideal but if you are going to move South Carolina wouldn’t offer much of a benefit unless you don’t make much of an income.
The price for sunshine on a regular basis, police that can do their job, and less in your face politics? Priceless. Count me in.
Fun with numbers you PPF doooofus!!
South Carolina is very tax friendly for retirees. Social Security benefits are not taxed, and while retirement income is partially taxed, individuals aged 65 and older can claim up to $10,000 in retirement income deductions from pensions, 401(k)s, IRAs, and other retirement accounts.
Do you even know the types and amounts of income which are exempt from state income taxes in IL? I think you don’t. I say that because you seem to think $10,000 of such exemptions is huge. It isn’t! IL exemptions in some retirement income categories are unlimited! That’s one reason retirees with larger incomes still like living here. I urge you to investigate that issue online. You’ll likely be astonished at how IL is so attractive compared to SC on that subject.
My accountant is a CPA based in IL, practice mainly tax strategies and says she’s jealous of the tax policies of SC compared to IL, and says we made great SC move financially. If you are more knowledgeable than she is and think we’d be better off in IL, maybe you can be our tax preparer. Keep drinking that IL brainwashing kool aid. The area we live in has more than 30 former IL residents, many of them more financially astute than I am, and everyone says we are so much better off tax wise than being in IL.
Your accountant Wally may be correct for your current situation but you obviously don’t know the tax rates of SC for retirees compared to Illinois if you are referencing your accountant instead of just providing the actual comparison in tax rates. SC has a progressive tax rate that currently tops out at 6.2%. Retirees are allowed a 15k deduction or 30k for a couple. After that, retirement withdrawals are taxed at the progressive tax rates. While it’s true you and the 30 former residents could be better off, for others with higher incomes it would be more expensive. Even saving… Read more »
Do you really think Taxistan will continue to not tax retirement income. The massive liability black hole Taxistan currently has for pensions and OPEB is only going to get bigger esp. if Tier2 pensions are removed.
Even Warren Buffet warned companies about moving their businesses to any state like Taxistan that has massive pension liabilities.
You don’t seem to have a clue that the people you’ve mentioned all have some incentive to try pleasing you and themselves simultaneously. Each has a bias for personal reasons. Think about it. You might see that subject in the final exam!
Not only that James, Wally doesn’t actually know the details. He is telling us his “accountant” and his “30 friends” who are financially savvy said it’s better. He doesn’t understand that every states tax policies offer pros and cons and depending on an individuals own circumstances, one state may be better for some but not for others. According to him you are “fool” for not saving money like him even though it may not actually save you money. It did for him so it must for everyone else. This is part of a larger problem in our society. People become… Read more »
My accountant and my financial services firm have been servicing me for over 30 years and have done quite well. We have a second financial service firm that is in agreement. You have no knowledge of my situation, they do. Do I trust their advice? They are CPAs, CFPs, and CLUs, and estate planners. I am ignorant, know it, and ask those who do know. I should listen to someone on the internet who is deeply entrenched in the IL pension Ponzi scams?
I didn’t tell you that SC wasn’t right for you. I, merely stated that for others it is more expensive. I’m glad you have a team of experts (taking their cut) to help you out because you have a massive reading comprehension problem and appear financially ignorant without their help. You don’t seem to understand that everyone’s situation is different. You admit you don’t understand or know the details yet you continue to pretend you know best. I will say it again to help with your comprehension. It sounds like SC is best for you. However, others with higher income,… Read more »
Sorry, James, the people I’m referring to include physicians, lawyers, DMs for Walgreens, McDonalds, and several CEOs with no incentive to please me. I’m the puny guy in the group soaking in their years of experience. Funny, none from CPS or any government employees union.
Probably because they are middle class retirees and can’t afford the income taxes they would pay on their pensions. A couple of pensioners collecting 250K in retirement would pay over 12K a year in income taxes on those pensions. As I’ve said, every person’s tax situation is different.
Those CEOs worth millions are probably worried about the estate tax that Illinois charges for estates over 4 million. I also doubt they chose SC for its favorable tax treatment alone. If that was the case they would have moved to Tennessee.
Sorry your income is so low. For my current situation, income taxes in SC would be over 16k before I’m required to take any RMDs later in life. In Illinois the income tax for SS and IRA/401k withdrawals is zero for the state. SC currently has a progressive tax that tops out at 6.2%. Rather than call people names why don’t you actually learn to address the facts before you. Who knows you might actually learn something and not go through life completely ignorant.
Can you see my hand gesture I am making in your direction?
No. My gated estate doesn’t allow me to see the peasants.
Maybe we could meet at the local Starbucks. Bring your Lambo. I’ll bring my Ferrari, and we’ll show ’em how to enjoy life for a change.
South Carolina is very tax friendly for retirees. Social Security benefits are not taxed, and while retirement income is partially taxed, individuals aged 65 and older can claim up to $10,000 in retirement income deductions from pensions, 401(k)s, IRAs, and other retirement accounts.
10k deduction isn’t much for successful retirees. I guess if you like going to the soup kitchen every day it’s ok but for some of us we want more from life.
I should also note that the same advisors have been setting up Roth IRAs for us for years. SC does not tax Roth IRA withdrawals and we could withdraw millions yearly tax free. The closest we get to a soup kitchen is the one my wife volunteers at weekly.
That’s for a Roth IRA. You had to use after tax dollars while living in Illinois (paying the Illinois rate at the time) while others have a standard IRA where it was tax deferred and they still don’t need to pay income taxes when they withdraw it once retired. SC doesn’t have as favorable income tax advantages for retirees as Illinois. This is a fact. Your situation may be different but it’s not for everyone. I don’t understand why you refuse to acknowledge this basic fact.
You’re right. I was foolish to live too long in IL, paying high income taxes and property taxes. I could have easily opened my practice in SC 20 years ago through reciprocity. Would have saved a lot of money. But I drank the “IL is so wonderful kool aid.” Sentimentally, I waited until my parents passed. I encourage others to move and avoid the same mistakes.
Don’t know where you get your facts from, but just got done with our accountant. RMDs or not, our state income tax bill is no more than it would have been in IL. SC income tax rates have gone down every year and it is estimated to be entirely gone in 5 years. That $10K paid for a nice cruise this year.
If income taxes are gone in 5 years that would definitely change the math for me as far as SC being a viable destination. Until then, income taxes are just too high for my bracket. It sounds like it’s working well for you though. Good for you but everyone’s situation is different.
A great guide to states you should not move to, and, states you should move out of.