What makes tax bills increase?
The amount of a property tax bill is determined by two things:
1. A property's equalized assessed value (a taxpayer's share of the total tax base)
2. the applicable tax rates, which depend on the level of spending of local taxing units in which the property is located.

If assessed values increase because of inflationary increases in property values, tax bills will not necessarily increase. As long as taxing districts do not increase their spending, a general increase in assessed values (i.e. the tax base) will mean lower tax rates and tax bills will stay the same. If taxing districts increase their spending, however, tax bills generally will increase regardless of changes in assessments.

The "Truth-In-Taxation Law" requires taxing districts to publish notices to taxpayers if the districts' proposed levies are at least 5 percent greater than the amount billed to property taxpayers the year before (excluding bonds and interest and election costs). This amount billed is called the extension. Districts must hold public hearings regarding proposed tax increases. County Clerks may not extend more than 5 percent over the previous year's extension if a taxing district does not certify that it has complied with these publications and hearing requirements.

When taxpayers feel their property assessments are unfair when compared to assessments on similar properties, they should use the appeal procedures outlined previously. On the other hand, if their appeal is that tax bills are going up, they should attend "Truth-in-Taxation" hearings to become familiar with he needs of local taxing districts which are spending their money, and to express their concerns about increasing taxes.

Show All Answers

1. How does the equalization factor effect tax rates?
2. What is a levy?
3. How do levies affect tax rates?
4. What makes tax bills increase?
5. When are taxes extended (billed)?
6. How is the tax rate computed?