A bill proposal in the Illinois General Assembly could impose massive tax hikes on small businesses. One measure would punish 22,020 small businesses in Illinois with a huge increase in their marginal state income tax rate, creating a top tax rate of nearly 50.3% at the Federal and State Level.
S-Corps and Partnerships, that “pass-through” their business income to their owners paying taxes as individuals, would see their top marginal state income tax rate jump from 4.95% to 7.95%, a 61% hike. The bill adds a 3% additional income tax on incomes exceeding $1 million.
The proposal successfully passed out of committee on April 21st. It could receive a full House vote any time before the May 3rd deadline for constitutional amendments.
Research has shown that increasing the top marginal tax rate correlates with a reduction in entrepreneurs’ hiring activity and smaller paychecks for their employees. You can find that research at the following web address…
https://www.nber.org/papers/w6578
Illinois already has one of the highest unemployment rates in the country and is among the slowest states for wage growth. This is made worse by some of the highest state and local tax burdens in the nation, including the second-highest property taxes and eighth-highest sales taxes.
Back in 2017 Illinois residents endured the largest permanent income tax hike in state history when lawmakers increased the rate by 32%, from 3.75% to 4.95%.
I’ve written extensively about how Illinois already pushes out more businesses than virtually any other state. This Millionaire’s Tax could make the situation even worse.
Illinoisans should reject this call for higher taxes on the state’s vital small business community. Contact your state representative to stop the small business tax hike by visiting the following web address, and letting your voice be heard.
Let me leave you with this…
Does this make you as angry as I am? I certainly hope that it does.
Let’s not forget that they already tried to pass a Constitutional Amendment creating a graduated income tax system. Illinois residents already voted against it even after our Governor spent over $30M of his own dollars trying to get it passed.
And here we go again.
In the history of taxation, the most common response to raising taxes is that Voters Vote With Their Feet. We leave.
Now they’re going after the people who create most of the new jobs in our state. They’re coming after entrepreneurs.
Do yourselves a favor. Go to the web address provided and let your representatives know that you don’t support this.
As always, if you’re having problems with your accounting and tax work, I’m waiting for your call.
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.
773-267-7500
888-310-0300
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