Illinois’ shrinking tax base: Residents are leaving and taking their incomes with them (Part 1)

Editor’s note: Wirepoints continues to be one of the most important websites in Illinois — their latest 3-part report by Ted Dabrowski and John Klingner is a good example of why. Here is an excerpt from part 1 of the series — links to parts 2 and 3 follow:

There’s perhaps no indicator more damning of a state’s failure to govern than the flight of its residents to other states.

People of every stripe are leaving Illinois. Old and young, rich and poor. They are going to warm states and cold states, big states and small states. Overall, Illinois netted losses of residents to 43 other states in 2016.

That has major implications for the state and the Illinoisans who remain. A shrinking population means a future with less economic growth, less investment, falling real estate values and an eroded tax base. And as people leave, fewer residents will be left to pay down the state’s growing debts, meaning the already massive burden will only gets worse.

Illinois has netted a loss of 1.5 million people to other states since 2000, based on U.S. Census data. And as international immigration and births in Illinois have declined in recent years, they’re failing to make up for Illinois net outmigration. As a result, the state’s population has shrunk five years in a row. Wirepoints analysed the results of the census data in our report: Illinois’ Demographic Collapse.

The following multi-part series will reveal just who is leaving, where they are going and what incomes they’re taking with them.

Wirepoints’ analysis uses national state-by-state migration data compiled by the Internal Revenue Service. The IRS reviews tax returns annually to track when and where people move. It also aggregates the ages, income brackets and adjusted gross incomes of filers.

In this first piece, we’ll cover Illinois’ net loss of tax filers and their incomes to other states since 2000.

Read more: Wirepoints

Read part 2: Illinois’ shrinking tax base: Loss in income is one of nation’s worst

Read part 3: Illinois’ shrinking tax base: $310 billion in accumulated losses from out-migration