What the city of Chicago should know about a potential Trump-style tax credit program
The city of St. Louis is the latest to launch a tax credit for home owners who live in neighborhoods where the rate of crime is above 30 percent.
The program is set to be tested in Chicago this fall, and it is set up as a pilot program.
What is the tax credit?
The credit is intended to encourage homeowners to upgrade their homes and pay down debt in their properties.
The idea is that homeowners can earn the tax credits by spending money in the community.
Is the credit available to single homeowners?
The credit is available to homeowners with an annual income of $100,000 or more.
Are there other incentives available?
There are incentives for homeowners to improve their neighborhoods, as well as incentives for local governments to do the same.
Can homeowners receive the tax subsidy if their homes are not worth more than $100 million?
The maximum credit is $200,000.
How long will the program be available?
The program will begin testing in October.
Why is St. Charles a good place to test the tax program?
A lot of the incentives in the pilot program are tied to demographics.
Charles is a historically black city, with a population of about 25,000, and the city’s population was 20 percent African American in the 1990s, when the credit was first introduced.
In fact, St. John’s, a small city of 3,500 people in the Southwestern suburbs of Atlanta, has a comparable rate of violent crime and property crime to St. Claire.
Where will the money come from?
To be eligible for the credit, homeowners will need to make payments on their property taxes in accordance with the guidelines set forth by the city.
Should I sign up?
It depends on where you live.
The tax credit is offered in two tiers.
$5,000 for single homeowners with annual income above $100k $10,000 to homeowners who earn more than that $20,000-$50,000 The amount you will receive depends on your income, the size of your home, and whether you live in a dense or rural area.
Who should apply?
Applicants can apply online through the city, through phone and text message.
If you live less than 10 miles from the city line, you can also call to find out how to apply.
Will the city pay for the program?
For example, a homeowner who makes $100K annually and lives in a neighborhood where crime is 30 percent below 30 percent could receive a $25,000 credit.
Does the city have a process for deciding which neighborhoods to test?
St. Louis does not.
Do I need to do anything special to qualify for the tax incentive?
You do not have to do any special activities to qualify.
The city does not have a fee for homeowners who live on the street or in an area with a low crime rate.
When will the city be testing the program and will I be eligible?
On Oct. 31, 2018, the city will begin accepting applications.
Once the program is live, homeowners in the first three tiers will receive the $5,500 tax credit.
The next tier of applicants will receive a further $5K in credit over time.
There is no timeline for the city to implement the program.
Is there a catch?
So, what do I need before I apply?
What to know about the tax incentives in St. Lawrence?
Property values are closely correlated with crime rates in a certain area.
In St. Joseph, a neighborhood with a rate of 27.6 per 1,000 people in 2010, property values rose by 3.5 percent per year after the credit began.
In other words, if your property values went up, your property tax bill went up.
Property crime rates are high in neighborhoods like St. Joe, and homeowners have little incentive to do something about it.
Tax credit rates will also vary based on income.
A homeowner with an income of less than $50,00 annually would receive the maximum credit of $5.50 for an annual family income of up to $150,000 and $10.50 if your family earns more than this.
Another $5 in credit would be available for an individual earning $100 per year or $50 per year for an employer earning $75,000 annually.
How will the credit work?
If your home is worth more that $100M, you will be eligible to apply for the $25K tax credit as well.
However, if you own less than that amount, the $20,00 credit will not apply to you.
Homeowners with annual incomes above $200K would also be eligible.
Those who own more than 100K annually would also receive the full $25