10 Aug Smart Move Of a County on Tax Collections
Kenosha County in Wisconsin has initiated some sweeping changes in its policy on collecting real estate taxes. The County put up a delinquent Tax Manager software to speed up their system. The software will keep track of delinquent property and the County treasurer will notify owners of record and the process that would lead to tax deed sales.
It was established that as of Feb. 7, some 593 properties or 0.23 percent of the all nonexempt properties countywide, were delinquent in tax payments. Of those, 364 parcels are actively proceeding to take on back taxes. The tax deed eligible process takes six-to-eight months from the letter report on the delinquent tax payment before it is scheduled for tax deed sale. Of the 364, for example, some 358 are at various stages within the process before the county can take ownership of them for taxes due.
- Payment is set up so people will be paying off a year’s taxes in 8-10 months, plus interest and penalties. They’re making good faith efforts.
- Those in bankruptcy court, prevent creditors, including the county, from moving on the properties while bankruptcy proceedings sort things out and place entities in line for collections.
- Some properties are also on hold, such as abandoned gas stations, until environmental concerns had been identified as to whom is liable for cleanup.
The County has made payment plans a lot easier since the App had started that in February the total $9,832,323 in delinquencies had been reduced to $5,777,736 by September. This was mainly due to the software program developed in-house by the county’s IT department.
Information and data gathered by Terra International Realty further showed some significant factors leading to the sweeping changes initiated by Kenosha County:
- The tax manager app eliminated the need to manually check every parcel every month. Instead, once delinquent payment plans are entered, the app tracks every time a payment is made and receipted — or no payment had been recorded at all..
- Every month, a payment report is made that will show the status of the tax due. The office then sends notices to those property owners inclusive of their statements of account.
- Kenosha County has been doing a good job in collecting taxes especially when the new App was introduced assuring almost 99 percent collection rate. This was because, in addition to paying off the delinquent amount, owners are charged one percent interest plus a 0.5 percent monthly penalty calculated on the duration of the nonpayment.
People naturally complain that the 18% yearly add-on is too high for a loan. But when the County explains it represent interest and penalty for not paying their taxes on time and that the next course of action is to take the property for auction, those owners whose properties are really enjoying good market values will immediately settle. While those whose delinquent taxes are more than the properties’ worth will simply let go.