Enterprise Zone & Enterprise Map

Abatement of Property Tax on New Improvements

Property tax on real estate improvements that raise a commercial, industrial or manufacturing property's fair market value by more than $10,000 is abated at the following schedule:

For projects that create fewer than 100 jobs:

• 100% of property tax on the improvement is abated for the first five (5) years after project completion
• 50% of property tax on the improvements is abated for the second five (5) years after project completion

For projects that create 100 jobs or more:

• 100% of property tax on the new improvement is abated for the first ten (10) years after project completion

Full Abatement

• Owners of properties listed on the National Register of Historic Places are eligible for 100% abatement for the first seven years and 50% for the following three years.
• The property tax abatement provisions do not exempt owners of property in the Enterprise Zone from property tax altogether. The program abates property tax on new improvements, but not abate the tax paid on existing buildings and land. Abatement on an individual property is also limited to the amount of tax attributable to eligible improvements on the property.
• Property tax abatement through the Enterprise Zone does not “freeze” an owner’s property tax. The tax due on a property during the ten-year abatement schedule will fluctuate based on reassessment and changes in the tax rate.
• Property tax abatement's apply to building renovations, expansions and construction of new buildings.

Property Tax Definitions

• Assessed Value: One-third of a property's fair market value. The total assessed value for a given property has two components-the value of land and the value of improvements.
• Fair Market Value: The amount a willing buyer would pay a willing seller for a given piece of real estate. The fair market value is determined by the Township Tax Assessor to establish the assessed value.
• Improvement: A building or other structure else attached to land which cannot be readily removed.
• Tax Rate: The formula applied to assessed value to determine the property tax due for a property. The tax rate is often expressed as "$8.64 per $100 of assessed value."

Deduction of Sales Tax for Building Materials

100 % of sales tax on materials used for construction or renovation of buildings in the Enterprise Zone can be deducted at the time of purchase. This provision applies to commercial or industrial construction.

Permanently Affixed

The sales tax deduction applies to items that are permanently affixed to real property, such as:

• Glued-down Carpets
• Lumber
• Mortar
• Paint
• Wallpaper and Similar Affixed Items

As a rule of thumb, sales tax on any building materials that would remain with the property if the property were sold is eligible for the deduction.

Deductions

The deduction does not apply to materials purchased for routine maintenance, repair or upkeep of the property. The sales tax deduction includes both the local and state portion of sales tax. Any retailer who pays Illinois sales tax can deduct the sales tax, so long as the purchaser provides the retailer with a Certificate of Eligibility for Sales Tax Exemption, which is issued by the City's building inspector.

City building permit fees on any renovation, expansion or new construction project within the Enterprise Zone are waived. This waiver of fees applies to:

• Building
• Demolition
• Electrical
• Expansion
• New Construction
• Plumbing
• Site Plan and Zoning Certificate Fees for Permits Issued for Rehabilitation

Fees

Fees charged for permits issued for normal repair or replacement of electrical, plumbing or mechanical systems are not waived. Filing fees for rezoning or special use applications are not waived.

Pursuant to Illinois Public Act 97 to 905, Enterprise Zones are permitted to collect fees for sales tax abatement certificates that are issued to project applicants within designated enterprise zones. The Jackson County Enterprise Zone charges a fee of (0.5%) of the value of building materials, not to exceed $50,000 per project. Fees must be paid to the Enterprise Zone Administrator prior to the release of sales tax abatement certificates.

There are a number of state tax incentives for investment in an Illinois enterprise zone. These incentives are related to income, utility, and sales taxes. The programs are listed below. Detailed information on each program is available from the City of Carbondale, Greater Egypt Regional Planning Commission or the Illinois Department of Commerce and Economic Opportunity.

• Corporate Contribution Deductions
• Enterprise Zone Investment Tax Credit
• Income Tax Deduction for Financial Institutions
• Manufacturing Machinery and Equipment Sales Tax Exemption
• State Utility Tax Exemption