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12. FAQ About Property Taxes

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1. What is market value?

Market value is the amount at which a property would sell in a competitive and open market, presuming that (1) both the buyer and seller are knowledgeable about the sale and are using sound judgment by allowing sufficient time for the sale and (2) the sale is not affected by undue pressures (e.g., foreclosures, bankruptcy, etc.).

2. How is the market value for my property determined?

One or more of the following three methods is used to determine market value:

Market data—Similar, neighboring properties that have sold recently are compared to the property being assessed.

Cost—The cost to reproduce (or rebuild) the property is calculated, the amount for depreciation (e.g., wear and tear, age) is subtracted, and land value is then added.

Income—The present worth of the income from an income-producing property is calculated by measuring the amount, quality, and durability of the future net income the property can be expected to return to an investor.

3. How can I tell if my assessor has placed a fair value on my property?

The first method is to compare the fair market value of your property with recent sales of
similar properties in your neighborhood. This method is appropriate if you have recently purchased your property or have obtained a professional appraisal. The second method is to compare the assessed value of your property with similar properties in your neighborhood. You can get this information from your township assessor or the supervisor of assessments office.

4. What is an Assessment?

An assessment is the property value that is officially entered in the county assessment books (sometimes called the "tax roll"). This value is used to determine what portion of the total tax burden each property owner will bear. Your assessed value is 33.33% of the fair market value of your property.

5. What can I do if I don’t agree with my assessment?

It is strongly recommended that you discuss your assessment with your township assessor before you file a complaint. If you’d still like to file a complaint after you talk to your assessor, you may file an appeal with the Will County Board of Review.

6. Shouldn’t my assessment have gone down based on the declining real estate market?

While housing prices are falling in much of the country, property values in Will County remain stable despite a decline in the number of sales. In addition, Will County uses a three-year study for assessments, so we’re always a year behind. That means township assessors will look at 2007, 2008, and 2009 sales when determining the Jan 1, 2010 market value (2010 Tax Year bills are paid in June and September of 2011).

7. What if I think my tax bill is too high?

Once you have received your tax bill, it is too late to appeal your assessment for that levy year. Assessments should be appealed soon after assessment notices are published and mailed in late August of the prior year. Only actual errors of fact (e.g., missing exemptions, incorrect square footage, miscalculation of tax rate, etc.) can be corrected after you receive your tax bill. If you believe an actual error of fact was made on your tax bill, please contact your township assessor.

8. How does my assessment affect my tax rate?

All properties in the tax district you belong to have the same rate. Your individual assessment has very little impact on that rate because your property is such a small percentage of the district. Since taxing districts receive the same amount of dollars or more each year, depending on the consumer price index, when assessments go down, the tax rate will go up.

9. What are taxing districts?

Taxing districts are local government units including townships, counties, municipalities, schools, and park districts that use property tax to finance the majority of services that they provide citizens. School districts receive the majority of property tax revenue for education.

If you look at your tax bill, the taxing districts are listed along with the amount each one receives from your tax contribution. View an example table

10. My assessed value has decreased, so why have my taxes increased?

There are three variables that determine whether or not your taxes will go up or down. Those three variables are:

• The assessed value of your property
• The amount of money that the taxing districts request for operating expenses through their annual levies
• The total assessed value of property in your taxing district

The relationship of these 3 variables determines what your taxes will be. Several examples below illustrate how the math works, however, in summary, if your home’s value increases more than the average of all the other properties in your community, your taxes will go up If your home’s value decreases more than the average of all other properties in your community, your taxes will go up. This is because taxing districts receive a set amount of money each year, independent of tax rates, and when the average EAV of a community decreases, the rate will go up to ensure enough money is collected for the taxing district. If you home’s EAV went up more than or decreased less than the community’s overall average EAV, this is when you will see you taxes actually increase.

Assessed value of your property goes up & everything else stays the same
Suppose the taxing districts decide they need to raise $1 million in property taxes and the assessed value of all the property in your community is $100 million. The property tax rate is calculated by dividing the amount of tax to be raised by the total assessed value:

$1 million/$100 million = 1% Tax Rate

In this scenario, if your property’s assessed value is $100,000, your tax bill would be calculated by multiplying your assessed value by your tax rate:

$100,000 x 1% = $1,000 Taxes to be paid

If the amount requested by the taxing districts stays the same and the overall assessed value of your community stays the same but your assessed value increased from $100,000 to $125,000, your taxes would increase:

$125,000 x 1% = $1250

Total Equalized Assessed Value can also drive a tax rate up or down
Property growth in a community is extremely important to whether a tax rate will go up or down. If the total assessed value of your community doubles from $100 to $200 million and the amount of taxes to be raised stays the same, your tax rate would go down:

$1 million/$200 million = 0.5 % Tax rate

If the total assessed value of your community decreases from $100 to $80 million and the amount of taxes to be raised stays the same, your tax rate would go up:

$1 million/$80 million = 1.25 % Tax rate

If your property’s assessed value stays the same and the amount of taxes that needs to be raised by the taxing district’s stays the same, under the growth scenario presented in first example your taxes would go down:

$100,000 X 0.5% = $500

When a community begins to lose property growth or value, even if your property’s assessed value stays the same and the amount of taxes that needs to be raised stays the same, your taxes will go up.

$100,000 X 1.25% = $1250

My assessed value went down but my taxes went up
If your assessed value decreased from $100,000 to $90,000, and if the tax rate goes up due to the taxing bodies asking for more dollars or your taxing district’s Equalized Assessed Value goes down, your taxes would go up because the rate has increased.

$90,000 x 1.25% = $1125

11. Do foreclosures in my neighborhood affect my property taxes?

Yes. Foreclosures can cause the residential equalized assessed valuation to fall, leaving you to bear the tax burden of your bygone neighbors. Usually reductions in a taxing district’s equalized assessed valuation can cause tax rates to rise.

12. Why are taxes so high in my community and I hear in other communities taxes are very low?

The first reason is that the taxing districts in one community may be asking for more money than the taxing districts in the other community. There are many reasons why this may be. Some examples would be more students to educate, more area to patrol or keep safe, etc…

The second reason may be that one community may have the benefit of more commercial and industrial property to absorb the majority of the tax burden. In such a community, tax rates can be low because industry and commercial property keep the EAV very high and thus make the rates very low for all tax payers, including homeowners. The homeowners in the Crete-Monee 201U tax district do not have this circumstance. A very high percentage of the CM201U Taxing District EAV is residential property.

13. Is there any tax relief available for homeowners?

Yes. There are several exemptions for which you may qualify. Please contact your local assessor’s office for information concerning available home owner exemptions.