March 2, 2023
This post presents information on residential, commercial and industrial estimated effective property tax rates in northeastern Illinois municipalities in 2019, with some comparisons to rates a decade prior. The Civic Federation produces an annual estimated effective property tax rates report for Chicago and 28 other selected municipalities in northeastern Illinois. Of the municipalities, 12 are in Cook County (including Chicago) and 19 are in the collar counties. The effective tax rates calculated in this report are based on data from the Illinois Department of Revenue and the Clerks of Cook, DuPage, Kane, Lake, McHenry and Will counties.
Effective property tax rates are a measure of property tax burden for homeowners and businesses. They translate the tax rates on property tax bills into rates that reflect the percentage of full market value that a property owed in taxes for a given year. For example, a property with a market value of $300,000 and an effective tax rate of 2% would have an estimated property tax liability of $6,000.
By standardizing the expression of property tax burden, effective property tax rates provide a method of comparing average property tax burdens in different areas over time. However, these are estimates for the purpose of broad comparison rather than precise expressions of tax burden on specific properties. To calculate the effective property tax rate for a specific property, divide that property’s annual property tax liability by its market value for the same year.
Effective property tax rates should be regarded only as estimates for several reasons:
- There are multiple property tax rates within each municipality, and the effective rate calculated in this report is representative of only one of those tax rates.
- Effective property tax rates for residential properties do not include homestead, senior or other exemptions.
- The effective tax rate calculations utilize information on the median level of assessment within a given geographical area. While a property is likely to be near the median level of assessment, the actual level of assessment for any given property could be greater or less than the median.
It is also important to recognize that a decreasing effective tax rate does not necessarily translate into decreased tax liabilities. A property owner whose property is appreciating in value may experience annual property tax increases despite a decreasing effective tax rate. In this report, four of the 12 municipalities in Cook County experienced an effective property tax rate decrease on residential property in tax year 2019 compared to the previous year. Ten of the 12 municipalities in Cook County experienced a decrease across commercial property between tax year 2018 and 2019. Industrial effective property tax rates in the selected Cook County municipalities for which data were available increased over the two-year period.
There were not enough sales of industrial property in the Chicago assessment triad and South assessment triad in tax year 2019 for the Illinois Department of Revenue to calculate assessment to sales ratios. As a result, the Civic Federation was only able to calculate the 2019 estimated effective tax rates for Cook County industrial properties in the North Triad. In the collar counties, the effective property tax rate for all types of property increased across the majority of the selected municipalities between tax year 2018 and 2019, with the exception of Elk Grove Village (-0.4%), Aurora (-1.4%), Carpentersville (-1.3%), Fox Lake (-4.5%), Waukegan (-1.8%) and Peotone (-13.8%). The highest property tax rate increase over the two-year period among the collar counties is the City of Woodstock, which increased by 8.3% to 3.51%, up from 3.24% in 2018.
In the 10-year period between tax years 2010 and 2019, the effective tax rates for residential property decreased in all of the selected municipalities in Cook County, except for properties in Evanston, Chicago, Barrington and Chicago Heights. For commercial properties, the only municipalities whose effective tax rates increased were Chicago and Harvey. There were not enough sales of industrial property in tax years 2010 or 2019 in the South Triad to calculate an effective tax rate. In the collar counties, effective tax rates for all types of property declined in the majority of the selected municipalities over the 10-year period examined. However, five municipalities in the collar counties saw an increase in their effective tax rates. They are Lake Forest (14.5%), Romeoville (4.8%), Buffalo Grove (2.6%), Oak Brook (2.2%) and Wheaton (0.1%).
For more detailed information on the estimated effective property tax rates within selected municipalities in northeastern Illinois from 2010 to 2019, click here for a PDF of this report.