Rich People Are Fleeing Connecticut

Lawmakers like Connecticut’s Democratic Gov. Dannel  Malloy should pay attention to the latest batch of IRS data, which show tax payers – particularly wealthy ones – are leaving Connecticut for states like Florida, where there is no income tax, and New York City, where taxes are high but at least you can order Chinese food at 4 am.

Indeed, as the Hartford Courant points out in an editorial, the latest data reveal that Connecticut is in the middle of a taxpayer exodus.

Those who moved out of Connecticut from 2015 to 2016 took with them more than $6 billion in adjusted gross income, or AGI.

 

Connecticut

People who moved to Connecticut brought with them only about $3.36 billion in AGI. The total net loss to Connecticut: $2.7 billion. In one year. That was in the top five of all states, regardless of population.

And that was before this year’s budget battle, which nearly precipitated dramatic cuts to municipal services. The taxes and cutbacks that lawmakers agreed to in order to pass a compromise budget bill will likely anger more monied nutmeggers.

Connecticut collected $6.85 billion in income tax from the 2015 tax year, or 4.3% of the $161 billion in AGI reported from all filers. If that same ratio held true in 2016, then the loss of $2.7 billion in AGI would have meant an actual loss of more than $100 million in income tax revenue.

 

Connecticut

While that’s not a whole lot relative to the state’s 20 billion budget, it’s still a not-insignificant amount of money.

As the paper’s editorial board warned: "Legislators, this is strong evidence that taxing residents at high rates is becoming counterproductive."

Here’s more from the Courant:

The average adjusted gross income for all filers who moved out of Connecticut last year was $123,377 — the highest in the nation and far above the state's median income. The average AGI per return for those who moved in was $92,677, or $30,699 less than those who moved out — the biggest difference in the nation. Put another way, those who moved in were not enough in number, or in income, to replace the expats.

The states that poached the most taxpayers from Connecticut were New York (8,202 tax returns) and Florida (7,944). The average adjusted gross income for those who left for New York was $111,653. That's pretty bad, but it's nowhere near as shocking as Florida, where the average return from former Connecticut residents was $253,187 in adjusted gross income.

That means more than $2 billion in income moved from Connecticut to Florida from 2015 to 2016, more than twice as much money as moved to New York.

The overall trend of richer people leaving Connecticut has been increasing over the last five years, according to the IRS data.

The total number of tax filers and their average AGI for people who moved out of Connecticut was higher last year than at any time since before 2011-12. For example: From 2012 to 2013, more than 48,000 tax filers had moved out of Connecticut, nearly as many as moved out from 2015 to 2016, but the average return was about $112,000 in AGI, compared to over $123,000 last year.

This is just another reminder that Connecticut’s lawmakers need to find a way to deal with the state’s intractable pension problem without soaking the rich.

Comments

catman2 vealparm Jan 7, 2018 9:16 AM Permalink

So true. NJ is a zhithole for the most part and gaining speed. The illegals are pouring in it seems in record numbers and the once quiet town I live has screaming emergency vehicles most of the day and night. They move from the cities and from abroad from one zhithole to turn NJ in to a bigger zhithole. Typical liberalism.  

In reply to by vealparm

JRobby end times prophet Jan 5, 2018 6:14 PM Permalink

Watch the blue north east states whither and die. All those "absentee" jobs I recall in NJ for decades while the state "employee" was out running a business or working elsewhere while on the state payroll will come crashing down.

Oh, and that pension you were counting on? It doesn't exist. Move to Ecuador because at least your social security will be inflated from all those years of being over paid.

In reply to by end times prophet

bluez 1 Alabama Jan 5, 2018 5:22 PM Permalink

You idiots. Rich people have absolutely zero need to "flee" Connecticut. Fer Christ sake's, they live there. Idiots. They will always live there.

They will simply re-designate their "official domicile" to Maine or South Dakota, or whatever.

But they will sill still actually live in Salisbury, CT.

(Which is an absolute wonderland to visit, but you won't, since you're not hip enough).

In reply to by 1 Alabama

Son of Loki bluez Jan 5, 2018 5:28 PM Permalink

Zacktly.

 

For example, Cheney has his "domicile" in Texas...a small humble place that I am sure he seldom visits. But that's where he states his residence is. His real house is probably a $10 million mansion in the Colorado mountains of outside of DC with a 15 foot wall around it and a half dozen bodyguards.

That's one reason peeples buy [cheap] studio condos in low tax states. So they can claim that low tax state as their residence for some tax purposes and sometimes other reasons too.

In reply to by bluez

AGuy bluez Jan 5, 2018 10:06 PM Permalink

"You idiots. Rich people have absolutely zero need to "flee" Connecticut."
They absolutely no reason to stay:

1. Terrible roads, The bridges are rotting, some roads are unsafe to drive on. Traffic is crazy, Its much worse in CT than CA.
2. Crappy winters.
3. Rising Crime, and business are leaving.

The Rich are leaving. They are moving thier business out of CT and moving out too. Before the Internet, Wall St use to by homes in Greenwich, Stamford CT, so they could compute in to NYC. But with electronic trading it no longer matters if you live in NY, CT or Idaho. As long as you have a good internet connection you can trade.

In reply to by bluez