How and Why: Your Estimated Tax Bill

Each year the Cook County Assessor’s Office reassesses one-third of Cook County. This year the Assessor’s Office is reassessing the north and northwest suburbs of Cook County. That means that every property owner in this Triennial Reassessment District will receive a "Notice of Proposed Assessed Valuation," or Assessment Notice.

This Assessment Notice lists property characteristics, proposed assessed value, and an estimated impact of property taxes. It is important to understand that the Assessor’s Office is simply the first step in the Cook County property tax system. In fact, the Assessor’s Office is responsible for assigning a value to all property in Cook County, while local taxing bodies request money (levy) that is then calculated into tax rates to be applied and mailed by other agencies involved in the property tax process.

The purpose of providing the property owner with an estimated impact of property taxes during a reassessment is simply as a customer service. Previous years’ Assessment Notices did not include an estimated tax bill calculation. With the inclusion of the new "2007 Estimated Tax Bill in Dollars," the Assessor’s Office hopes to educate property owners on how their property tax bill is calculated and how the new reassessment values will impact on their tax bills, mailed by the Cook County Treasurer the following year.

The following is an explanation of how the Assessor's Office calculates an estimated tax bill on Assessment Notices:

As you can see in the equation above, that resembles the equation found on Assessment Notices, there are four numbers that are "estimated." In the case of the "Estimated 2007 Property Value," that is the number that the Assessor’s Office has calculated your property to be worth due to sales of similar properties in the last three years since the last reassessment. The "2007 Estimated State Equalizer" is what the Assessor’s Office expects the Illinois Department of Revenue to set their annual State Equalizer at for 2007. However, this number is only an estimate, the actual 2007 State Equalizer could be higher or lower than this estimate. In the same way, the "2007 Estimated Tax Rate" is a conservative estimate of what the tax rate of each property’s tax code will be for the following tax year (in this case 2007) based primarily on historical trending of levies for each taxing agency within each individual tax code. This estimated tax rate is then refined based on communications with the Cook County Clerk and local Township Assessors as to large levy increases and referendums. This estimated tax rate is then multiplied by the "Adjusted Equalized Value" to reach the estimated tax bill. Once again, this is an estimate and should not be considered an actual tax bill.
 
The following is a more in-depth look at how the Cook County Assessor’s Office estimates 2007 tax rates:

• Tax rates are estimated by tax code and not Township because of the variance in rates between taxing bodies.

• Historical triennial reassessment trends were analyzed for 2003, 2004 and 2005.

• The change in tax rates from 2003 to 2005 was applied to the 2006 tax rates establishing a 2006 to 2007 trend factor.

• Information from the Cook County Clerk’s Office and from individual Township Assessors combine with trending data to arrive at an estimated 2007 tax rate.

The estimated 2001 tax rate may vary from the final 2007 tax rate because:

• Tax levies may vary from year-to-year.

• Unknown may be issued or come due.

• T.I.F.’s (Tax Increment Financing)

• Consumer Price Index factor changes.

• Amounts of new construction may vary from year-to-year.

• The total number of Homeowner Exemptions may fluctuate from year-to-year.

Cook County Assessor James M. Houlihan hopes that this estimated tax bill equation serves to help taxpayers better understand the property tax system. If there are any questions regarding this equation please call the Cook County Assessor's Office Taxpayers Information Department at (312) 443-7550 Monday through Friday from 8:30a.m. until 5:00p.m.