How will paying property tax in four installments work?

Real estate tax bills will be mailed in early December like always. In the past, when you received your bill, you could pay the entire amount, or you could choose to pay in two installments: one installment due by January 31st, and one due by July 31st. Currently, when you receive your bill you can pay the entire amount by January 31st, or you can choose to pay in four installments: one due by January 31st, another by March 31st, another by May 31st, and a final installment paid by July 31st.

Why does the City offer four installments instead of two?

The biggest reason for this difference is to help property owners who otherwise might go delinquent in their payments. At least 60 municipalities in Wisconsin collect property taxes using this system of multiple installments. A study done by economists at the LaFollette School of Public Affairs at the UW-Madison showed that in those municipalities, the delinquency rate was one-half the rate for the municipalities that offered only two installments.

Can I just continue to pay in two installments the way I have done in the past?

Not really. You can no longer pay the first installment in January and the second installment in July. The new system REPLACES the old system. However, nothing prevents you from paying the first two installments (or more) in December or January. If you do this, we will send you a reminder notice in May when the third installment is due. At that time you can choose to pay the third installment in May and the fourth in July, or, if you'd like, you can pay the remaining balance and be done with the 2022 taxes. It's up to you. We have created a number of different scenarios that give examples of how taxpayers might make their payments. In particular, scenarios 5 and 6 deal with this subject.

Can I just take my total tax and divide by 4 to calculate the amount of each installment?

Not really. Different credits and charges are applied in different ways. For instance, if you are receiving a lottery credit for your principal residence, the entire amount of the credit reduces your first installment. Also, if you have a special charge or special assessment, the entire amount is added to your first installment. Therefore, it's typical for the first installment to be a different amount than the other installments.

What happens if I forget to make one of the payments?

If you choose to pay in installments, and then miss one of the scheduled payments, you are now delinquent and two things occur. First, you are no longer able to postpone future installments, ALL OF THE TAX BECOMES DUE IMMEDIATELY. Second, you are charged 1% interest and .5% penalty for each month or portion of a month from February 1st. These charges are calculated on the outstanding remaining balance.

What if I make a payment, but I accidentally pay less than the required amount?

Unfortunately, if you pay less than the minimum, you will be considered delinquent. Wisconsin state statutes define what constitutes delinquency. They leave no "wiggle" room for errors that are unintentional or inadvertent. Please be careful and make sure that you are paying at least the minimum that is due.