April 15 seems almost a distant memory as summer nears, and taxes are often the last things on our minds. But taxes aren't just an April 15 issue. Summertime is when counties, cities, school districts and other local taxing entities are preparing their budgets and tax rates for the coming year.
In the next three months, those entities will be presenting their proposals in public meetings and hearings. It's important the public remain engaged in the process.
Federal income taxes are only a portion of the total taxes we all pay. If we don't pay attention now, we could be surprised by a big tax bill later in the year.
And because those local public officials are — almost by definition — more responsive to local residents, now is when we can all have a significant influence on our tax bills for next year.
The Bloomberg News Service recently studied local taxes, and found they're growing — even as pressure from conservatives is having an effect in Washington. It used Illinois as an extreme example.
"More than any other state, Illinois illustrates how local taxing bodies flourish across the U.S., whether urban or rural, Republican or Democrat," Bloomberg reported. "The governments duplicate services and burn tax dollars at the same time states slash money for education and Washington cuts discretionary spending. In Illinois, which has the 11th highest state and local tax burden in the U.S., overlapping government agencies managing everything from mosquito abatement to fire protection collect billions of dollars, employ tens of thousands and consume resources that could help pay pension deficits and $7.5 billion in outstanding government bills."
We don't always notice those "smaller" taxes.
"Taxing districts — parks, libraries, fire protection and others — make their presence known in the small print on tax bills, through property and other assessments," Bloomberg explained. "Small-government activists such as the Tea Party concentrate on cutting federal and state spending."
Local taxes are not an insignificant expense — for any of us.
On average, state and local taxes (in various forms) gobble up 9.9 percent of an American's income, according to the Tax Foundation. That's not as high as the 17 percent the federal government takes on average, but it's still substantial.
For homeowners, it's easy to overlook the numerous taxing entities because property taxes are usually rolled into our mortgages. We pay them as part of our monthly checks to the bank.
Even if we see a tax bill from the Smith County Tax Office, we might only pay attention to the total — and not see the components of that total, which can include the city, the county, the school district, Tyler Junior College, and perhaps the Emergency Services District No. 2 or a municipal utility district.
Summer is when tax rates are set. A penny here and a penny there sounds small — but when we're talking about multiple taxing entities, those pennies on the tax rate can add up.
We pay a lot of taxes. Let's not overlook any of them.