2011 Local Income Tax Distributions

In August 2010 the State Budget Agency released the 2011 local income tax distributions for local units. The 2011 distribution is down by an average of 15.9% with nearly $556 million less state wide when compared to 2010. Click here  to view a chart comparing each counties income tax distributions for calendar years 2010 and 2011.

After two years of significantly decreased state income tax collections, it was expected that the local distributions, which are on an 18 month lag, would similarly decline. It is, however, difficult to verify these numbers. State income tax returns are consider private information by the Department of Revenue. Year-to-your changes may also be affected by state adjustments made to correct over or under distributions in previous years.

The drop in income tax revenue available for local units also has a negative impact on property taxes as less money will be available for local property tax replacement and homestead credits. With reduced credits, more property tax payers will hit the tax caps creating an additional loss of revenue.

The IACC and AIC  is watching these developments closely and is communicating local concerns to state officials and legislators. Do not hesitate to contact us with any questions or comments. 

 

Property Tax Studies Released  The Legislative Services Agency recently released three reports examining the changes in property taxes in general and the impact of the circuit breaker tax caps in general. These are updates from past reports. The 2010 Statewide Property Tax Report contains analysis of changes in property tax bills and the overall beneficiaries of the tax caps. The 2010 Property Tax Estimates by Property Class study shows the general changes in property tax collections since 2007. Also included is information on the distribution of tax cap credits by property class on a unit-by-unit basis. For example, statewide, 16.6% of homesteads receive a credit in 2010. This also provides a more detailed breakdown of the types of property classes within the 2% category. The 2010 Circuit Breaker Credits study provides a unit-by-unit breakdown of the circuit breaker impact in 2010 with estimated credits in 2011 and 2012. Note: The 2010 Statewide Property Tax Report does not include Lake or LaPorte Counties, likely impacting statewide numbers. The other two reports do include numbers (some estimates) for Lake and LaPorte Counties.