Illinois income tax

House Revenue and Finance Committee
Brian Mackey / NPR Illinois

Democrats are advancing legislation that spells out the rates for a proposed graduated state income tax.

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Brian Mackey / NPR Illinois

Gov. J.B. Pritzker has finally revealed a few details about his plans to change the Illinois income tax. He's asking the General Assembly and voters to approve a constitutional amendment making the flat tax into one that's graduated, where the wealthy pay higher rates.

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Brian Mackey / NPR Illinois

Gov. Bruce Rauner vetoed several bills in the past week. One would have raised the cap on how much money people wronged by state government can recover — Illinois’ relatively low cap of $100,000 came to light after the deaths of more than a dozen residents of the Illinois Veterans’ Home in Quincy.

Other vetoed bills would have raised the age to purchase tobacco products from 18 to 21, sought to improve relations between immigrant communities and the police, and set a minimum salary of $40,000 per year for new teachers.

Bruce Rauner
Rich Saal / The State Journal-Register (pool)

When out campaigning, Governor Bruce Rauner has been making big claims about lowering taxes. But there was little follow-through in Wednesday's budget proposal.

Bruce Rauner
Rich Saal / The State Journal-Register (pool)

Illinois Governor Bruce Rauner has been campaigning relentlessly against last year’s income tax increase.

But in his annual budget address Wednesday, he'll call for spending the extra money that rate hike has generated.

Bob Daiber
Brian Mackey / NPR Illinois

Most of the Democrats running for governor of Illinois have long since come out in favor of a graduated income tax, where wealthier people pay a higher rate on income above a certain amount. But it wasn’t until Thursday that one candidate said what that amount ought to be.

screenshots from candidate TV ads

Unfortunately, even if the winner of the contest for governor is able to resolve what are arguably the two most pressing fiscal issues the state faces, Illinois’ budget would still be in deep trouble.

Notes On The Final Governor Debate

Oct 21, 2014
wttw Chicago Tonight

The debate portion of the Illinois governor’s race is over. Monday night's debate may have given voters a little clarity.

Now - that doesn’t mean there wasn’t any mud-slinging or repetitive campaign refrains. There was a lot of that. But we did get some answers on issues that have popped up in all three debates. Like what Governor Pat Quinn would do when the 5 percent income tax rate ends in 2015.

QUINN: We need to maintain the income tax, at the same time give annual, direct, property tax relief - a 500 dollar refund - to every single homeowner in this state.

Hannah Meisel/WUIS

  Republican candidate for governor Bruce Rauner hammered on Democrats at the Illinois State Fair Thursday. The Democrat facing the most criticism is Governor Pat Quinn.

Rauner was greeted almost like a rock star as he rolled into the Republican Day party on his Harley. Every time he mentioned voting Quinn out of office, the crowd erupted in cheers.

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Brian Mackey / NPR Illinois | 91.9 UIS

As the Spring Session nears its end, the House and Senate agree on a state spending plan, but a decision on keeping the state income tax at its current level will probably be held off until after November.   Also, House Speaker Madigan suggests divorcing the Abraham Lincoln Presidential Library and Museum from the Illinois State Historic Preservation Agency.

Brian Mackey / NPR Illinois

  The budget being expected to be pushed through the General Assembly Friday does not count on extending the 2011 income tax hike. But Republicans say they can "see through" the Democrats' plan to revisit the income tax after the November election.

After Democratic leadership gave up on attempting to keep Illinois income tax at five percent, the House pushed through what Democrats call a "middle of the road" budget. It taps into other revenue sources and relies on delaying payments to vendors in order to keep spending relatively flat.

Brian Mackey / NPR Illinois

  The Illinois House overwhelmingly rejected a so-called "doomsday budget" Friday — one that does not rely on extending 2011's income tax hike. It would have imposed deep cuts across Illinois government.

It was the budget that few legislators — Democrat or Republican — actually wanted to pass. It would have slashed education and other government services.

But the budget did not pass. In fact, only five lawmakers voted for the stripped-down budget, including Rep. Fred Crespo, from Hoffman Estates.

WUIS

  Advocates for nursing homes say if Illinois does not keep income tax rates where they are, thousands of seniors could lose access to care. But it's not yet clear whether the General Assembly will make the tax hike permanent.

Lawmakers have a little less than a month to pass a budget for the next fiscal year -- a budget that nursing homes rely on to subsidize their operations.

Advocates say if the state's income tax is allowed to roll back as scheduled at the end of the year, nursing homes are projected to take a 14 percent funding cut.

Bruce Rauner and Pat Quinn
Brian Mackey/WUIS

  The governor of Illinois, as well as the man who wants to take his job, were both in Springfield Wednesday. What they were doing offers a clear picture of the different directions they want to take the state.

Republican Bruce Rauner was in town to file petitions for his term limits proposal. Then he addressed a meeting of business groups holding an "Employer Action Day."

"Let's make Illinois the most attractive state to do business, rather than one of the most hostile states to do business," he said. "Nothing else more important than that. Number one priority by far."

Host Amanda Vinicky and guests Ray Long (Chicago Tribune) and Nicole Wilson (24/7 News) discuss Gov. Pat Quinn's possible political hiring as well as Madigan's backing of the 5% income tax continuing, not enough votes for increase in minimum wage, possible death of the graduated income tax.

  As more baby-boomers retire, Illinois is increasingly missing out on a revenue source. Of the 41 states with an income tax, Illinois is one of only three that exempt all pension income.

A new report from the Chicago-based Civic Federation says Illinois needs to take a longer-term approach to budgeting; one that is rooted less in politics, and more in reality. Most notably. the group recommends Illinois extend its current income tax rate for a year before gradually rolling it back.

Civic Federation

The Civic Federation is releasing a new proposal it says will balance Illinois' budget, eliminate its bill backlog and reduce taxes.  

The plan includes capping spending to help the state pay off its $5.4 billion backlog of unpaid bills over the next five years.  

It also would extend the state's temporary income tax increase by a year before reducing tax rates gradually, and calls for taxing pension and social security income.  

Although the search for a way out of the state’s public pension mess has been the focal point in Springfield for the past two years, it’s not the only fiscal question mark looming over Illinois’ political landscape.

But unlike the years-long build-up that led to the slow-motion pension train wreck, this potential debacle has a timeline that’s crystal clear. On January 1, 2015, the first phase of the state’s temporary 2011 income tax increase will expire, potentially blowing a projected $2.2 billion hole in the state’s revenue stream.