WILFORD: Illinois Looks To Raid Private Retirement Accounts To Solve Its Pension Crisis

[rangerrebew]

WILFORD: Illinois Looks To Raid Private Retirement Accounts To Solve Its Pension Crisis
11:00 AM 02/23/2019 | Opinion
Andrew Wilford | National Taxpayers' Union Foundation

Illinois has a severe pension crisis. That’s probably an understatement — the state has over $130 billion in unfunded pension liabilities alone. Last summer, Moody’s reported that the state made the record books for the largest ever pension debt-to-revenue ratio, with pension debt equaling 601 percent of total government revenue. So what are some in the state proposing to solve the problem? Going after money in private retirement accounts, of course.

Two state policy groups, the Civic Committee of the Commercial Club of Chicago and the Civic Federation, have come out in favor of ending an exclusion in the state’s income tax for pension income and federally taxable Social Security income. Doing so, the organizations argue, would raise $2.5 billion in revenue, equivalent to a 0.5 percent income tax rate hike and a 0.85 percent corporate tax rate increase.

https://dailycaller.com/2019/02/23/wilford-illinois-pensions/

[catfish1957]

WILFORD: Illinois Looks To Raid Private Retirement Accounts To Solve Its Pension Crisis
11:00 AM 02/23/2019 | Opinion
Andrew Wilford | National Taxpayers' Union Foundation

Illinois has a severe pension crisis. That’s probably an understatement — the state has over $130 billion in unfunded pension liabilities alone. Last summer, Moody’s reported that the state made the record books for the largest ever pension debt-to-revenue ratio, with pension debt equaling 601 percent of total government revenue. So what are some in the state proposing to solve the problem? Going after money in private retirement accounts, of course.

Two state policy groups, the Civic Committee of the Commercial Club of Chicago and the Civic Federation, have come out in favor of ending an exclusion in the state’s income tax for pension income and federally taxable Social Security income. Doing so, the organizations argue, would raise $2.5 billion in revenue, equivalent to a 0.5 percent income tax rate hike and a 0.85 percent corporate tax rate increase.

https://dailycaller.com/2019/02/23/wilford-illinois-pensions/

I understand that IL is a taxation hell hole, but i am having problems tying the comment around "Going after money in private retirement accounts",  versus simply saying they will tax penison and SS income.  The two definite separate issues.

[LMAO]

 If this goes through, I can’t imagine who would stay in Illinois after that 

[SZonian]

When you tax a pension, you are "raiding" it. 

That is just that much less the pensioner will have in retirement so that state pensioners can maintain "all".

IMO, this is evil. 

I'm saving what I need to in the private sector without benefit of the state "promise" and because the state screws it up, they come and take from me?

[catfish1957]

When you tax a pension, you are "raiding" it. 

That is just that much less the pensioner will have in retirement so that state pensioners can maintain "all".

IMO, this is evil. 

I'm saving what I need to in the private sector without benefit of the state "promise" and because the state screws it up, they come and take from me?

How this reads is confusing.  You are correct if the state is going to tax the "pension" as an entity.  I read this is that they were going to tax income (personal) which before now was exempt under IL tax code.  In laws lived there is how I know.

The earlier of the two constitutes double taxation, which should get a court challenge (IMO)

[goatprairie]

Illinois has hundreds of thousands of gov. employees who have to have their gold-plated retirement funds replenished.
What's wrong with people? Don't they want to help out those great state employees who help keep the Thief Party i.e. Democrat Party running? 
Illinois isn't the first state to think about robbing citizens. I expect to see a lot more Dem-run states do that.

[Wingnut]

This Tax and spend liberal Gov also wants to implement the Chicago "plastic bag tax" state wide.  7 cents per bag.  For Chicagoan's that would jump to 12 cents a bag.     

@mystery-ak

[IsailedawayfromFR]

Anyone know whether public pensions are taxed by Illinois?  Why not do this if they are not?  It will have net effect of reducing the pensions paid out.

Another thing Illinois can implement:  Make it mandatory that anyone receiving a public pension must maintain residence within the state. 

Seems fair to me.

[To-Whose-Benefit?]

If this goes through, I can’t imagine who would stay in Illinois after that

California too. Why would anyone stay?

But they do, tied to a job they can't get elsewhere or just too broke, by Govt, to Afford to move.

[Wingnut]

California too. Why would anyone stay?

But they do, tied to a job they can't get elsewhere or just too broke, by Govt, to Afford to move.

And that is why Illinois is a failed state.

[Snarknado]

To be fair, almost all other states with an income tax levy it on pension income. Only a dozen or so tax SS benefits though...

[Wingnut]

To be fair, almost all other states with an income tax levy it on pension income. Only a dozen or so tax SS benefits though...

To be fair.  What is fair about that?   

[mystery-ak]

This Tax and spend liberal Gov also wants to implement the Chicago "plastic bag tax" state wide.  7 cents per bag.  For Chicagoan's that would jump to 12 cents a bag.     

@mystery-ak

I guess it's time to buy reusable shopping bags...Gawd this state just gets worse

[Cyber Liberty]

California too. Why would anyone stay?

But they do, tied to a job they can't get elsewhere or just too broke, by Govt, to Afford to move.

They have expensive Mortgages, and in the sunken Real Estate price picture there, they can't sell.  They are, in effect, anchored by their Mortgages.

[Cyber Liberty]

I guess it's time to buy reusable shopping bags...Gawd this state just gets worse

Be sure to double-wrap your Chicken, Pork and Beef. 

[LMAO]

 Should all of this pass, Illinois will be a test case of what other states will try to do up to and including the federal government.

Social Security, especially Medicare, are rapidly running out of money and Illinois isn’t the only state with a massive unfunded pension liability. And “taxing the rich” isn’t going to fix them

[goatprairie]

Should all of this pass, Illinois will be a test case of what other states will try to do up to and including the federal government.

Social Security, especially Medicare, are rapidly running out of money and Illinois isn’t the only state with a massive unfunded pension liability. And “taxing the rich” isn’t going to fix them

I remember reading some years ago about some big-city mayors running out of other people's money wanting to tax suburbs to get their money.
I believe the mayor of Indianapolis concocted a plan to do that, but I don't know if it was ever realized.

[IsailedawayfromFR]

I remember reading some years ago about some big-city mayors running out of other people's money wanting to tax suburbs to get their money.
I believe the mayor of Indianapolis concocted a plan to do that, but I don't know if it was ever realized.

that is outright theft.


Why dont they tax Europe if going that way?

[Snarknado]

Should all of this pass, Illinois will be a test case of what other states will try to do up to and including the federal government.

Social Security, especially Medicare, are rapidly running out of money and Illinois isn’t the only state with a massive unfunded pension liability. And “taxing the rich” isn’t going to fix them

SS and pension are already taxable at fed level. Most states already tax pension and I think 13 tax SS.

Pelosi is pushing a plan to immediately raise the SS wage cap and gradually raise the payroll tax rate. Which not surprisingly puts almost the entire burden on businesses and higher earners to pay for another massive giveaway...