Illinois currently has a $4 million “death tax,” as many call it. What that means is that when an Illinois resident dies, his or her assets in excess of $4 million are taxed by the state up to 16%. Those who feel the weight of the “death tax” are the survivors, and for those left behind, the burden can be back-breaking.
While most think of farming families as those that suffer the most from this tax policy, there is a considerable number of small and mid-sized manufacturers in Illinois that are third- and fourth-generation businesses.
The successive generations work hard all their lives to build companies while providing healthy incomes and careers for multiple team members who are growing families and communities, only to come to the time of life when they desire to pass on to their legacies all they’ve sacrificed to build.
All that, only to be hit with a death tax that, in many cases, is so substantial that those inheriting must sell assets to pay the taxes.
State Rep. Adam Niemerg (R-102) represents a substantial number of taxpayers who are calling for Illinois to adjust the state’s $4 million exemption to one that reflects the much higher federal tax exemption level, which is soon to be $15 million.
Enough is enough, Niemerg told TMANews.com.
“You spend your whole life paying taxes in the state of Illinois. You work your **** off to try to build something, make the payroll, grow something for your family. And when you’re ready to pass it on, who comes in but the state of Illinois and Uncle Sam to take another chunk out of what you earned and what you did for your family. It has to stop now,” he said.
Niemerg, whose district runs along the Indiana border in the central part of the state, represents a large farming constituency that is very concerned about the tax squeeze they face in the days to come.
However, it’s not just farmers who are concerned about inheriting acreage; small and mid-sized manufacturers face the same dilemma. Niemerg said he grew up in a small manufacturing family business, so he understands the sacrifices and struggles fully.
“I come from a small business background. My dad started a candle manufacturing company out of our garage in 1995,” Niemerg said. “He just sold the company several years ago, where he made candles for close to 30 years. So I understand what it means to run a small business. I know what it means to grow up in a small business. And I understand the trials and tribulations that business owners go through. It’s very difficult.
“You’re not given anything as a small business owner in the state of Illinois, except heartache and grief,” he said. “And that has to stop.”
If the Democrats really wanted to show appreciation to Illinois farmers and raise the exemption to help generational farmers, they could easily do so, he said. They have a supermajority in both Illinois General Assembly chambers – plus, they own the Governor’s Mansion.
“Our budget is completely broke. We’ve had to raise taxes by a billion dollars just to meet the deficit,” Niemerg said. “Governor Pritzker put forth a $55 billion budget. And you’re going to continue to take from small businesses and farmers in the state of Illinois for your radical liberal agenda? The answer is no. That has to go. It has to…”
“Please get up to the federal limit,” he said. “It has to match at least what they’re doing out in DC. I’d like to see it completely eliminated.”
With the higher exemption of $15 million at the federal level, there is hope that Illinois Democrats will take on the challenge of relieving the growing tax burden on businesses that have been in Illinois for generations. But few observers and residents of the 102nd are optimistic that the issue will be taken seriously unless Illinois taxpayers grab onto the issue and encourage their lawmakers to consider raising the exemption.
Niemerg says he’s determined to do all he can for his neighbors in east central Illinois.
“I represent a border district where folks raising their families, they have their farms or they have their businesses, and everything’s tied into Illinois,” he said. “They just can’t get up and leave.”
TMA’s Advocacy Team is working with lawmakers to share TMA members’ concerns on the state’s “death tax” bill. They welcome hearing members’ stories about how Illinois’ tax policy has affected their businesses.
Please share your story at info@tmaillinois.org
By Fran Eaton, TMANews.com editor
