Residents of all age and income groups move out, but those making over $200,000 lead the departures.
High-income earners left Illinois at twice the rate of other residents in 2023, according to IRS data.
People in all income brackets leave the state, but just under 34,000 of those making over $200,000 a year moved out in 2023, the data show. The net loss was about 17,300.
Of those making over $200,000, Illinois lost about 12 residents per 1,000 in 2023 — twice the rate of any other group.
The next-largest group leaving were those making between $100,000 and $200,000. That was a net loss of nearly 16,000 people, a rate of about 6 per 1,000 in that group.
Combined, these two groups make up 60% of those who left Illinois in 2023, the most recent data available.
Not just high-income Illinoisans move out. The state did not gain residents from a single IRS a demographic. Illinois is failing residents across the board, with nearly 56,000 people and over $6 billion in income leaving in 2023.
The majority of those were in the prime working ages. Tax filers ages 26 to 54 and their dependents represent 55% of those who left the state in 2023, totaling 28,621 people.
Filers under 26 and their dependents represented an additional 8% of outmigration. Sixteen percent of those leaving the state were retirement age.
The vast majority of residents and income that left Illinois went to lower-tax states, further evidence of what Illinoisans routinely tell pollsters: High taxes are the No. 1 reason residents consider leaving.
Polling from NPR Illinois and the University of Illinois Springfield found that 61% of Illinoisans thought about moving out of the state in 2019, with taxes the No. 1 reason.
Back in 2016 the Paul Simon Public Policy Institute found that 47% of Illinoisans wanted to leave the state, and “taxes are the single biggest reason people want to leave,” with 27% of those respondents citing that as why.
More recent polling by Echelon Insights in 2023 substantiated that sentiment, as did polling conducted last year by M3 Strategies.
Illinoisans face one of the highest state and local tax burdens in the nation, including the second highest property taxes and eighth-highest sales taxes. 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%.
Despite Illinois’ continued outmigration amid an onslaught of taxes, state lawmakers are again pushing for higher income taxes in the current legislative session, including the potential to tax retirees.
A proposal that would add a 3% additional income tax on income above $1 million is scheduled for a hearing April 23. If it passes out of committee, it could get a full House vote.
That proposal comes at a time when Illinois is already pushing out tens of thousands of high-income residents who are taking billions of dollars with them to lower-tax states.
It’s not just individuals who might pay more. More than 22,000 small businesses —s-corporations and partnerships — that “pass-through” their business income to their owners and pay taxes as individuals would be hit with the tax hike, too.
Small businesses are Illinois’ primary job creator, both historically and in the recovery from the COVID-19 downturn. Illinois is already pushing more businesses out of the state than anywhere else. This tax hike could make the situation even worse.
Contact your state representative to stop the Small Business Tax Hike here.
