The tax bill you just received is for year 2015, although it is due in 2016. In Illinois, property taxes are a year in arrears. Accordingly, in 2017, you'll receive the tax bill for 2016.
It all starts with the assessed fair market value of your property. I obtained the tax bill from a resident who lives pretty much in the center of Wadsworth. The assessed fair market value of the property is $199,386.
The next step is to calculate the equalized assessed valuation. Simply, it's 1/3 of the assessed fair market value. For this property, it's $66,462.
From the equalized assessed valuation, there are many possible deductions, such as for general homestead, senior homestead, farmland, veterans, etc. In this case, the property owner is eligible for a $6,000 homestead exemption, which reduces the $66,462 to $60,462. This amount is called the taxable valuation.
For this particular property, the tax rate is $9.945572 per hundred dollars of taxable valuation. You then divide $60,462 by 100 and you get $604.62. $604.62 times the tax rate of $9.945572 equals $6013.29 which is the exact amount of this property owner's tax bill.
How is the tax rate of $9.945572 determined? Honestly, it's a complicated process with two component parts. In this case, there are 17 different taxing authorities to which this property owner's tax dollar goes. There are schools, county government, pension funds, forest preserve district, road and bridge district, the Village of Wadsworth, etc.
For the first component of the tax rate, some taxing authorities submit a levy for a fixed amount of taxes, say to pay the principal and interest due that year on bond issues. Your share for this amount is fixed, so to speak, regardless of your taxable valuation. That's one reason your valuation could decrease while the total tax due does not.
The same reasoning applies to the six different pension plans that you pay for. There is a pre-determined annual funding requirement regardless of what happens to your valuation.
For the second component of the total tax rate, other taxing authorities submit a flat tax rate that is applied to the taxable valuation. If your valuation goes up, your total tax bill goes up. If that rate goes down, the tax bill goes down.
Just as a parenthetical note, within the Village of Wadsworth boundaries, there are different fire protection districts and different school systems. Therefore, not all Wadsworth residents will have the same rate of $9.945572.
Our area suffers from "gerrymandering", which is a maddening process of creating different local governmental boundaries with no geographical conscience. This nightmarish concept was invented about 200 years ago in Massachusetts to achieve certain political advantages.
And finally, only $10.81 of this $6,013.29 tax bill goes to your Village. The rest goes to the 16 other taxing authorities with the majority of it for the school districts. For the fiscal just ended, we received only $44,000 from all the properties within the Village.
