Illinois woman’s property tax is poised to pop from $756 to over $10,000

[John105]

The real story here is how the County mis-assessed the property since the 2007 law went into affect. In reality, the landowner has been (apparently dramatically) underpaying property taxes since that time...

Wonder what the penalties would be for me if I just underpaid my property taxes for 17 years...

interestingly I didn't understand the child tax credit and did not take it the year my son was born (thought he'd need to be alive for 12 mos) 3 years later I filed an amended return, and it took almost 4 mos, but the IRS paid the child tax credit plus interest. That I found odd, it was my error.

If you underpaid well I would think it would be considered unpaid and penalties assessed year 1. We've all learned the idea of unjust enrichment but it seems more and more society is for it, not against it.

 

[MNgopher]

Maybe we BITOGER's should be more diligent regarding our assessment and knee jerk reactions of the media: Oopsie @GON
This topic is mostly about the ineptness of Illinois lawmakers, as already mentioned above.

I'd look at it differently - how is it Illinois lawmakers fault that the local county authority did not apply the law correctly for 17 years - resulting in the "outrage" at the higher tax bill.

Shouldn't the finger be pointed squarely at the local government in this case?

Its been law since 2007, yet it appears only this county is experiencing this issue. If the law was the issue, you'd think that one of the other counties in IL would have worked to get the law changed in the last 17 years.

 

[Vil_Riker]

Maybe we BITOGER's should be more diligent regarding our assessment and knee jerk reactions of the media: Oopsie @GON
This topic is mostly about the ineptness of Illinois lawmakers, as already mentioned above.

https://www.thejournal-news.net/stories/woodland-assessment-changes-will-not-go-in-effect,160146

https://www.illinoispolicy.org/1400-property-tax-hikes-in-montgomery-county-on-hold/
"Montgomery County Board Chairman Doug Donaldson announced property taxes hikes stemming from a 2007 law will not go into effect and that an ad hoc committee will explore the issue."

“While we believe the Supervisor of Assessments was following the timberland reclassification legislation from 2007, we also understand that applying the law could result in serious consequences in our county,” Donaldson said. “We heard that loud and clear, and we appreciate the efforts of those who took the time to express concerns.”

​

That's one county. I'm sure some will follow suit and some won't.

 

[doitmyself]

I'd look at it differently - how is it Illinois lawmakers fault that the local county authority did not apply the law correctly for 17 years - resulting in the "outrage" at the higher tax bill.

Shouldn't the finger be pointed squarely at the local government in this case?

Its been law since 2007, yet it appears only this county is experiencing this issue. If the law was the issue, you'd think that one of the other counties in IL would have worked to get the law changed in the last 17 years.

That's an excellent point. In my mind (wrongly) I generalized that all government, both local and state are at fault for passing and implementing this bizarre tax assessment on rural wooded acreage. I agree with all that you state. I, too, am surprised that no other counties in Illinois have challenged this 2007 law. But, it IS Illinois.

Here's the Illinois fact sheet. It seems to revolve around the definition of a farm: https://tax.illinois.gov/content/da...operty/documents/woodedacreageassessments.pdf
"Woodland, woodlots, woodland pasture, or timber tracts that are not part of a “farm”
Just because a tract is located in a remote or rural area, or because a tract of land has trees or brush
on it, does not make it eligible for a farmland assessment. Wooded acreage that does not qualify for a
preferential assessment is assessed at 33 1/3 percent of market value according to its highest and
best use.

A more in depth link: https://tax.illinois.gov/content/dam/soi/en/web/tax/research/publications/pubs/documents/pub-135.pdf

Looking at this VERY briefly, it seems that if she initiates a forest management plan, she can qualify for the lower assessment. I didn't look at the other options (Conservation, etc.). A simple forest stand prescription could be developed by a lay person (aka, DIY) following a few USDA, land grant university extension publications, etc. Managing for recreation, wildlife, etc. could involve little to no timber harvesting.
https://www.treefarmsystem.org/stuf...files/atfs_management_plan_template.2022.docx
https://www.forestasyst.org/managementplan.html
https://efotg.sc.egov.usda.gov/references/Public/LA/ForestMgtPlantemplate_(003).pdf
https://www.google.com/search?q=how...IAQCYAgCgAgCYAwCSBwCgBwA&sclient=gws-wiz-serp

 

[SC Maintenance]

interestingly I didn't understand the child tax credit and did not take it the year my son was born (thought he'd need to be alive for 12 mos) 3 years later I filed an amended return, and it took almost 4 mos, but the IRS paid the child tax credit plus interest. That I found odd, it was my error.

If you underpaid well I would think it would be considered unpaid and penalties assessed year 1. We've all learned the idea of unjust enrichment but it seems more and more society is for it, not against it.

I filed my taxes on paper in 2020 (I had lots of free time in April 2020, and my taxes seemed pretty simple).

18 months later they finally processed the paper return. They got all backed up from "Pandemic". All the work from home IRS folks weren't working. I am sure your shocked.

I owed some more by their calculation, and was charged interest for the whole 18 months. The law is the law so I wasn't all that unhappy, except the rate seemed unfair - fed funds +3%. They don't pay that rate on T-bills. A 2 year T-bill is typically fed funds plus 0.5 to 0.8. The interest rate on money I owe them should be related to the same as interest rate on money they owe me - no?

 

[Jetronic]

The problem is, woodland is typically not productive. Even if the expense is made to clear it for farming, there's likely a reason why it has been left to be woodland.... meaning it isn't suitable soil for farming. Farm ground makes income through corn, beans, and wheat... or to a lesser degree... for cattle through hay production or grazing. Woodland only makes money if the timber is desirable for logging, and if there is a mill within reasonable distance to process the timber.

or to build on....

 

[doitmyself]

The problem is, woodland is typically not productive. Even if the expense is made to clear it for farming, there's likely a reason why it has been left to be woodland.... meaning it isn't suitable soil for farming. Farm ground makes income through corn, beans, and wheat... or to a lesser degree... for cattle through hay production or grazing. Woodland only makes money if the timber is desirable for logging, and if there is a mill within reasonable distance to process the timber.

Not sure why you posted this in relation to the OP. Woodland can have other value and be productive beyond timber: aesthetics, recreation, wildlife, fuel, conservation-i.e., water quality, human health (yes, look it up), and now-a-days carbon sequestration. It's more difficult to put $ values on these aspects.

 

[CKN]

This is every state. They either have huge unfunded entitlements, or their books are cooked.

This is always been the issue with real property as an investment. As soon as they’re short money, they’re going to extort it from the owner.

HM..............No.
https://smartasset.com/retirement/utah-retirement-system

Utah’s retirement system is doing fantastic, which is good news for both retirees and current public employees. The defined benefit systems of the state increased in value by $3.3 billion. That’s a massive 11.7% boost from the prior year. The $750 million jump in the defined contribution plans is significantly less. But it still represents solid growth over just one year.
Much of this improvement is because of an increase in risk tolerance of the investments Utah chooses for its pension funds. Although this is undoubtedly a risky move, it seems to have paid off handsomely this time around.

 

[GON]

Maybe we BITOGER's should be more diligent regarding our assessment and knee jerk reactions of the media: Oopsie @GON

You have got to be kidding. If it wasn't for people posting about the situation on a nationwide basis- the redaction of the tax change more likely than not would not have happened, and this woman's tax bill would have gone from three figures to five figures annually.

Only after nationwide press and citizen uproar across the entire U.S. on the issue did this happen:

“While we believe the Supervisor of Assessments was following the timberland reclassification legislation from 2007, we also understand that applying the law could result in serious consequences in our county,” Donaldson said. “We heard that loud and clear, and we appreciate the efforts of those who took the time to express concerns.”
It doesn’t take a study to realize Illinois has the worst-funded pension systems in the nation, with state and local systems in the red by $142 billion in 2023. Amending the Illinois Constitution to allow for pension reform and raising the funding ratio so young workers have a secure retirement are required to fix the mess and avoid collapse.

 

[GON]

Not sure why you posted this in relation to the OP. Woodland can have other value and be productive beyond timber: aesthetics, recreation, wildlife, fuel, conservation-i.e., water quality, human health (yes, look it up), and now-a-days carbon sequestration. It's more difficult to put $ values on these aspects.

All irrelevant. It is her land. She should not have to justify why here land essentially was at risk from being taken from her to support out of control pension and like obligations.

One should never forget all the corruption in the Illinois public pension system. Like a law that was passed that if a school union official, who works just one day as a substitute teacher- YES JUST ONE DAY, is entitled to a lifetime Illinois pension and benefits that come with that pension that are more than just hefty monthly pension checks. I can post all day like of like sweetheart deals in Illinois where public employees get six figure pensions for almost zero common sense or justification.

 

[CKN]

Gon hates Illinois. Loves the Dakotas, Montana, etc., and buys a new house in one of the poorest states-New Mexico.

He lost money on Real Estate in the greater Chicago area. So.............

 

[SC Maintenance]

The story here is this line "the spike in property taxes is due to a 2007 state law that requires woodland tracts to be taxed like homes."

Now if its a potential building tract near a city, I sort of get it. But most woodlands have remained that way because there marginal properties. Bad soil, boggy, too far from anything, whatever.

Montgomery County IL is half way between Springfield and St. Louis. I am sure its a nice place, but I doubt builders are lining up to build track homes. Google says it has 27,000 people and 700 square miles of land.

How does the county even come up with a value? Banks won't even lend money for basic land parcels because there too hard to value and too hard to re-sell.

Taxing un-improved land like a home is stupid.

It just proves that when your state is running out of money, they will tax whatever real property they feel they can get away with.

 

[Exhaustgases]

I just wish the correct folks would wake up.

 

[GON]

I just wish the correct folks would wake up.

The sad part, they have. But one county and it's surrounding collar county have a big enough "block", that the residents living outside of that county gets ZERO vote.

The people of Illinois on a macro basis are very hard working, wonderful Americans. It is very sad to see one county, take away their ability to self determination.

That should help explain why the state has had 13 consecutive years of population decline, and a loss of a congressional seat.

 

[tbm5690]

The people of Illinois on a macro basis are very hard working, wonderful Americans. It is very sad to see one county, take away their ability to self determination.

That is pretty much how it works in most states.

 

[doitmyself]

You have got to be kidding.

No, I am not. This seems to be knee jerk reaction to poor, sensationalized media coverage of Montgomery County managers really mucking up their interpretation and implementation of the 2007 law.

Gon: I had to read the article a few times. Seems the computation of woodland now comes in at the same rate as a homeowner land.

While the article might imply that, the Illinois document does not: https://tax.illinois.gov/content/dam/soi/en/web/tax/research/publications/pubs/documents/pub-135.pdf

The law states that IF the property does NOT meet one of the many opportunities (7 +/-) to be considered "Preferential Assessment" , THEN it will be taxed like residential property (33.3% of value). No where does it imply all "woodland now comes in at the same rate as a homeowner land" as implied.

These concepts are reiterated in this simpler link: https://tax.illinois.gov/content/da...operty/documents/woodedacreageassessments.pdf
"Wooded acreage that does not qualify for a preferential assessment is assessed at 33 1/3 percent of market value" NOT all wooded acreage as you interpret from the media article.
"Wooded acreage that is not part of a farm may qualify for a reduced assessment under other statutory provisions."


My nurse daughter moved out of Illi noise and I cannot agree more with you about their messed up management by politicians.

I stand by my original opinion: This is a blunder by the Montgomery County managers interpreting and applying the 2007 law and very poor media coverage that did not investigate the facts about the law (my links) nor the county's handling of it..

 

[GON]

No, I am not. This seems to be knee jerk reaction to poor, sensationalized media coverage of Montgomery County managers really mucking up their interpretation and implementation of the 2007 law.


While the article might imply that, the Illinois document does not: https://tax.illinois.gov/content/dam/soi/en/web/tax/research/publications/pubs/documents/pub-135.pdf

The law states that IF the property does NOT meet one of the many opportunities (7 +/-) to be considered "Preferential Assessment" , THEN it will be taxed like residential property (33.3% of value). No where does it imply all "woodland now comes in at the same rate as a homeowner land" as you state in your first post.

These concepts are reiterated in this simpler link: https://tax.illinois.gov/content/da...operty/documents/woodedacreageassessments.pdf
"Wooded acreage that does not qualify for a preferential assessment is assessed at 33 1/3 percent of market value" NOT all wooded acreage as you interpret from the media article.
"Wooded acreage that is not part of a farm may qualify for a reduced assessment under other statutory provisions."


My nurse daughter moved out of Illi noise and I cannot agree more with you about their messed up management by politicians.

I think that I stand by my original opinion: This is a blunder by the Montgomery County managers interpreting and applying the 2007 law and very poor media coverage that did not investigate the facts about the law (my links).

We have very different analysis and assessments on this.

Why the heck should there ever be an item called a "preferential assessment". All taxpayers should be treated impartially, not preferentially for certain conditions often based on lobbyists, etc.

 

[doitmyself]

We have very different analysis and assessments on this.

Why the heck should there ever be an item called a "preferential assessment". All taxpayers should be treated impartially, not preferentially for certain conditions often based on lobbyists, etc.

I interpret preferential assessment as defining farm and wood land different than industrial, commercial, and residential and should be taxed different.

Different tax rates for different uses. I don't want my 80 acre rural, wooded hunting parcel in the U.P. to be taxed the same as a suburban Grand Rapids parcel with lots more government supported services (fire, police, schools, shopping, libraries, parks, biking/jogging trails, etc.).

 

[GON]

I see preferential assessment as defining farm and wood land different than industrial, commercial, and residential and should be taxed different.

I don't desire to debate or split hairs, and I will slip away from this thread with a final thought (picture):

 

[doitmyself]

We have very different analysis and assessments on this.

I agree with this!

Maybe a hug is appropriate? Kudos for eliciting good discussions. Take care.