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STERLING – As the old saying goes, there are two things you cannot outrun: death and taxes. While both can be scary, a little information can make taxes less terrifying.
According to the Illinois Department of Revenue, property taxes in Illinois are based on a property’s assessed market value. This value represents the price a property would sell for in a competitive and open market, assuming the buyer and seller are knowledgeable and use sound judgment. There also must be sufficient time for the sale, which cannot be influenced by undue pressures.
The state of Illinois does not impose a state property tax. Instead, the Illinois Constitution permits local taxing districts, such as counties and municipalities, to levy property taxes proportionate to the property’s assessed value.
Property tax types
Property is divided into two classes: real and personal.
Real property includes land and any permanent improvements made to the property, such as adding fencing or driveways, or changes to the landscape. Personal property includes items such as automobiles, livestock, furniture and money.
Only real property is taxed in Illinois. The Illinois Constitution abolished personal property taxes in 1970, replacing the lost revenue with taxes on income and invested capital.
Who pays property taxes?
The short answer is almost everyone. Property owners, including residential, commercial, industrial and agricultural property owners, pay property taxes directly. Landlords adjust their rents to cover these taxes, causing renters to contribute indirectly. Leaseholders pay on real property they lease from an owner with a tax-exempt property, such as state-owned farmland. The few exemptions include religious, charitable and educational organizations, as well as units of federal, state and local governments.
Where do my taxes go?
Property taxes fund most of the programs and services provided by local governments, including public health departments and libraries, with the largest share typically going to local school districts.
The property tax cycle
Chief county assessment officers typically evaluate property values on a two-year cycle, setting the value as of Jan. 1 during the first year. Tax bills are then calculated and mailed, and payments are disbursed to local taxing districts during the second year.
The cycle is broken down into six steps:
1. Assessment: After all property is discovered, listed and appraised, a local assessing official determines most property values, with some assessment responsibilities falling to the Illinois Department of Revenue and local county review boards. Percentage increases or decreases are applied uniformly by chief county assessment officers to ensure all assessments meet the legal requirement within their jurisdiction.
2. Review of the assessment decision: County review boards decide if assessments were correctly calculated, review all omitted property, and make determinations on homestead exemptions and nonhomestead applications. You can appeal assessments believed to be unfair with your county review board. Ultimately, the board’s decision can be contested with the State Property Tax Appeal Board or circuit court.
3. State equalization: The Illinois Department of Revenue standardizes assessments across counties and assigns a state equalization factor to each county. Equalization factors adjust the assessed values of properties in each county to ensure they are set at the required 33⅓% of the market value. Additional factors unique to each county may be included to bring all property to a uniform level.
4. Levy: Tax levies are part of the budgeting process. They are requests, typically by local government entities or taxing bodies, for operations funding via property tax dollars. Districts determine how much money they need from property taxes by projecting all expected nontax revenue and calculating the difference between that figure and the amount they need to operate.
5. Extension: After the equalization factor is applied, the county clerk calculates the tax rate needed to provide the revenues each district can legally levy. Those levies are disbursed among the district’s properties according to their equalized assessed values, allowing tax bills to be computed. The county clerk prepares books for the county collector and can reduce taxes per district wishes.
6. Collection and distribution: Tax bills are prepared by the county collector. They also receive property tax payments and disburse the money to the taxing districts that levied them. Tax collectors also execute sales of liens on real estate for failure to pay taxes.
The following links can be used to look up property by the owner’s name or address, view a breakdown of the local taxing bodies, the tax rate and how much owners paid to each body on their tax bill.
Whiteside County Property Tax Inquiry: whitesideil.devnetwedge.com.
Lee County Property Tax Inquiry: leeil.devnetwedge.com.
Ogle County Property Tax Inquiry: ogleil.devnetwedge.com.
When in doubt, consult a tax professional with any questions.
• The Telegraph and Sterling Gazette are dedicated to answering the questions Sauk Valley residents have about their communities. If there is an issue you’d like to learn more about, send your questions to Shaw Local reporter Brandon Clark, who makes it his mission to get the answers. Email questions to him at news@saukvalley.com.
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