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The Chicago Tribune Editorial Board cited Wirepoints’ research into the IRS’ “Safe Harbor” issue and how it could impact Illinois’ Tier 2 pensions. Like Wirepoints, the board says lawmakers need to learn far more about the IRS rules before passing any legislation.
Read more from Wirepoints:
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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The CT article sums it up. We need to know the TRUTH. If there is a problem it must be addressed or further legal challenges will make it even more expensive to solve. If it is not a problem then it can be laid to rest and we can forget about it.
The “Problem” is the taxpayers Problem, not Springfields. Just expect higher and higher taxes. Pensions are paid out for 30 plus years with 3% increase every year. Pensions are NOT TAXED in Illinois.
There is a 24 page “guidance” on these safe harbor rules found at: https://www.irs.gov/pub/irs-tege/public_employers_outreach_guide.pdf In 1980, the SSA issued guidance found at: https://www.ssa.gov/policy/docs/ssb/v80n3/v80n3p1.html. Trump agencies (IRA & SSA) are probably the last places to go for rulings on the current situation, which might have been advisable in earlier years. However, forcing local bankruptcies and enabling state bankruptcies might sound attractive to Trump and Musk and soften up the public for curtailment of federal entitlements. Just think: it could all be blamed on Dem states like IL and NJ. To be sure, the theoretical problem gets bigger as time goes by… Read more »
You have written an intelligent response.