Illinois is the least tax-friendly state, especially for homeowners, report says

Property taxes in Chicago really add up

Written By, Curbed Chicago, Chicago Real Estate Reports – 

 

Illinois is the least tax-friendly state in the country, according to a Kiplinger report, especially for homeowners.  Plus, new assessments led to big changes for some homeowners—as much as 11 percent increases in property tax bills.

 

Compared to other states, our property taxes are painfully high, says the report.  It’s enough to make people move to another state and some homebuyers are hesitant to purchase.

 

Illinois has the second-highest property taxes in the nation.  Kiplinger calculated that on a $400,000 home in the state, the average property tax bill could be $9,634.

 

In the wake of new property assessments, Cook County homeowners faced much higher property tax bills.  The city’s new assessor, Fritz Kaegi, was elected on campaign of reform.  He revamped the way property assessments are done, using accurate data and transparency.  The previous assessor’s corrupt system was detailed in a Chicago Tribune  investigation.

 

The new formula involves valuing single-family homes in a way that shifts some of the tax burden to wealthier neighborhoods.  The department’s data modernization allows the office to make the right call the first time.

 

As for what’s ahead, Mayor Lightfoot was pushing for a real estate transfer tax but wasn’t successful in getting state support during the last legislative session.

 

Looking ahead, there could be even more taxes as Mayor Lightfoot looks for solutions to fill the $838 million budget shortfall.  She’s suggested a higher tax on luxury real estate sales, and property tax increases similar to those from Emanuel’s administration aren’t off the table yet.  The mayor was also investigating adding on to the ride-hailing service fee and maybe even a downtown congestion tax.

 

What else do Chicagoans have to look out for?  Our dining tax doubled.  The flat-income tax of 4.95 percent is up for debate—Illinois Governor J.B. Pritkzer is pushing for a graduated tax based on tiers of annual income. Drivers now have to pay a higher gas tax to fund much-needed roadwork and vehicle registration fees are higher, too.  Plus, higher fees for Uber and Lyft rides.

 

As for sales tax: There’s a 6.25 percent state levy and Cook County has a 1.75 percent sales tax on top of that.  Some municipalities can add as much as 4.75 percent which means a sales tax could total to about 10 percent, according to Kiplinger.  At least we nixed the soda tax.