Lawmakers from Blue States across the country are beginning the process of raising taxes on the wealthy in an effort to close the funding gap caused by the OBBBA. Those measures include…
1 – State Rep. Aisha Gomez (D. MN.) has proposed legislation that would raise taxes on Married Filing Joint Taxpayers earning over $1M annually if Medicaid Cuts take effect.
2 – Connecticut Legislators have proposed a bill raising income taxes on couples making more than $500,000 and individuals earning at least $250,000 to offset the expected federal-funding losses from the new tax law.
3 – Gov. Bob Ferguson (D. WA.) signed a law last May that included an increase in the capital gains tax, among other things, citing a need to address the state’s budget deficit as well as expected cuts to federal funding.
4 – Gov. Wes Moore (D. MD.) signed a tax law that included higher income tax rates for state residents making more than $500,000 a year, to close his budget deficit.
5 – Rhode Island imposed a new tax on certain vacation homes valued at $1 million or more as the state tries to address its budget deficit. The levy, known as the “Taylor Swift Tax,” begins next summer.
Let me leave you with this…
I hate to say I told you so, but we all knew that they’d be coming. Illinois hasn’t yet begun their process, but you know they’ll be coming as well.
This is all happening under an interesting backdrop. Migration from Blue to Red States has accelerated as Americans flee states with higher taxes, unsafe streets, and terrible schools.
Between 2020 and 2024, California lost 1,465,116 voters, New York forfeited 966,209, and 418,056 voters strayed from Illinois. This happened while Texas gained 747,730 and Florida grew by 872,722. Other states like Utah, Idaho, Arizona and North Carolina posted large increases as well.
Immigration by migrants into Blue States has done little to change this trend. Many immigrants who initially go to New York, California and Illinois later leave for other states, for the same reasons as native citizens.
And now they’re raising taxes on the wealthy. Wanna guess what that will do to the state’s overall budgets? When a millionaire leaves, it takes a lot of middle and lower class taxpayers to make up the difference.
Voters vote with their feet. Get ready. It’s coming.
Our tax planning sessions in the fall should be interesting.
We’re all going to get through this. Let’s get through it together.
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. Whether you need Payroll Services, or Accounting and Tax Work, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
President
Accounting Solutions Ltd.
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