New Report Describes Property Tax Loopholes
The Institute for Wisconsin’s Future has released a new report that describes loopholes in Wisconsin’s property tax system worth hundreds of millions of dollars. The report noted that there are more than a hundred property tax exemptions currently in law. If all properties were taxed at their market value, it would generate up to an additional $700 million.
The majority of property tax-exempt property, according to the report, is owned by nonprofit organizations that are categorized as “benevolent.” IWF points to nonprofit hospitals and high-end retirement housing as two types of “benevolent” organizations that operate similarly to their for-profit counterparts, except for the fact that they do not have to pay property taxes. IWF’s analysis estimated that at least $128 million in property taxes was shifted from hospitals to other property owners in 2008 alone.
The report recommends limiting the definition of “benevolent,” as well as requiring full market assessment of properties allowed by law to be undervalued. IWF also advocates for more consistency statewide in the property assessment process, and regularly reviewing property tax exemptions.
The full report is here: http://www.wisconsinsfuture.org/publications_pdfs/tax/PropertyTaxExemptions12_2010.pdf