Rich Californians Flee Golden State Tax Regs
Number of State’s Upper Earners Drop Sharply
They call California the Golden State, but some of the richest Californians are heading for a place less golden.
State officials released a new report on taxpayers in California and the results don’t look good. The number of Californians earning more than $500,000 declined dramatically from 2007 to 2009 as the economy stalled, leaving fewer wealthy to tax in a state that focuses more and more on taxing them.
In the 2009 tax year, 98,610 Californians had an adjusted gross income of $500,000 or more, down roughly a third from just more than 146,000 in 2007. The 2009 figure represents just over a half-percent of the 14.6 million returns filed to the state’s Franchise Tax Board in 2009. Altogether, they paid 32 percent of income taxes.
It’s likely bad news for Gov. Jerry Brown, who’s pitching a tax plan to voters that targets the state’s wealthiest, along with an increase in the sales tax.
Whether the report is due to an exodus of the wealthy is hard to determine, but 2009 saw a drop in incomes. California’s top individual tax rate of 10.3 percent is the third-highest in the nation behind Hawaii and Oregon.
If you’re in the “1 percent” and are seeing your taxes rise, not paying them isn’t an option. The IRS and State authorities always keeps tabs on the big fish, so if you owe back tax debt make sure to hire a tax attorney to help you avoid a wage garnishment or bank levy and have a ‘golden’ outcome.