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New York state goes to extraordinary lengths to catch wealthy residents who try to flee its burdensome taxes, leaving a gaping hole in the state's treasury.
The Aggressive Approach by State Tax Collectors Comes from the Empire State Faces a $ 2.3 billion budget deficit that even Democratic Gov. Andrew Cuomo called "as serious as a heart attack."
Cuomo, a vocal critic of President Trump, blamed Congressional Republicans for passing tax reforms that reduced the state and deduction Americans can take on their annual income tax pinch, sparking their exodus.
"This is the flip side. Tax the rich, tax the rich, "Cuomo said last month. "We did not. Now, God forbid, the rich leave. "
"Tax the rich, tax the rich, tax the rich. We did not. Now, God forbid, the rich leave. "
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But New York state auditors are doing their best to ensure that they are faced with the challenges of tax compliance.
New York conducted 3,000 "nonresidency" audits between 2010 and 2017, recouping around $ 1 billion from the practice, CNBC reported.
Between 2015 and 2017, the auditors on average collected $ 144,270 per audit, with more than half of those who were audited losing their cases.
New York's success rate can be analyzed, but also to new high-tech tools that include tracking phone records, social media, and even veterinary and dentist records, according to the outlet.
Data show that between July 2017 and July 2018, the high-tax and Democrat-controlled states of New York and Illinois lost the most residents, with more than 48,000 residents, while Illinois' population declined by more than 45,000, according to the US Census Bureau.
It remains unclear how many top-tax-paying residents have been part of the world, but the data shows that low-tax states like Florida and Texas gained new residents.
"If you're a high earner in New York and you move to Florida, your chances of a residency audit are 100 percent," Barry Horowitz, a partner at the WithumSmith + Brown accounting firm, told CNBC. "New York has always been aggressive. But it's getting worse. "
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New York is also working extensively to catch those high-paying individuals who have to pay taxes in New York.
Unlike in New York, Florida's residents are taxed in the United States.
Even Blanca Ocasio-Cortez, mother of pro-tax Rep. Alexandria Ocasio-Cortez, touted Florida's low-tax system after fleeing the Big Apple.
"I was paying $ 10,000 a year in real estate taxes up north. I'm paying $ 600 a year in Florida. It's stress-free down here. "
"I was paying $ 10,000 a year in real estate taxes up north. I'm paying $ 600 a year in Florida. It's stress-free down here, "she told the Daily Mail from her home in Eustis.
Yet New York's get-tough approach towards its former residents may pose some dangers in the long-term. While recouping unpaid money works for the state's treasury in the short-term, such practices create a hostile environment for the wealthy that threatens to accelerate their exodus.
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And with the top 1 percent paying nearly half of the income taxes in the state, New York can not afford any more departures.
"Even if a small number of taxpayers leave, it has a dramatic effect on this tax space," Cuomo said last month.
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