Why does state law require equalization factors?

Illinois Department of Revenue classes explains that multipliers are used to put assessments at the same level between counties (state multipliers and county multipliers) and between townships (township multipliers). Illinois law states that assessments are to be at one-third of the property's market value.

  • If a person owns a $150,000 home, they should have an assessment of $50,000.
  • If a person with a $150,000 house in one county has the appropriate $50,000 assessment and a person in an adjoining county or township with a $150,000 house has an assessment of $35,000 and they are in the same school district - the person with the $50,000 assessment will pay more taxes to the school than the person with the $35,000 assessment for a house worth the same amount.

For example:

If the school rate is $3 per 100 of assessed value the difference would be as follows:

  • $50,000 × $3 divided by 100 = $1,500 would be paid to the school
  • $35,000 × $3 divided by 100 = $1,050 would be paid to the school

Since both properties should be valued at $50,000 based on both being worth $150,000, the $35,000 property needs to be increased by a multiplier/equalization factor of 1.42857.

$35,000 × 1.42857 = $50,000 × $3 divided by 100 = $1,500 paid to the school.

This adjustment results in both properties paying their "fair share" of the tax based on their market values.

Statistical studies called sales ratio studies.

Show All Answers

1. What is an equalization factor (multiplier)?
2. Why does state law require equalization factors?
3. Who does these studies?
4. What information is used for these studies?
5. What years sales will be used for 2016 assessments?
6. What factors influence equalization factors (multipliers)?
7. What happens if township equalization factors (multipliers) are not applied at the county level?
8. Does an equalization factor automatically increase or decrease taxes?
9. Does an increase in equalization factor usually result in an increase in an individual’s tax bill?
10. How do I know if an equalization factor has been applied to my property?
11. Does farm land receive a multiplier based on sales of farm property?
12. If I have additional questions?