Depending on what the Monroe County county council does in the next six weeks, all residents of the county could see as much as a 0.19 point increase to the local income tax (LIT) rate that they currently pay.
The higher tax would be effective starting on Jan. 1, 2025.
The increase would come in the category of the correctional facilities LIT. It’s commonly known as a jail tax.
It can be enacted by the county council on all county residents, including Bloomington and Ellettsville residents.
The current rate of the county’s jail tax is 0.01 percent. So an increase of 0.19 points would bring the jail tax rate to its statutory maximum of 0.2 percent.
A 0.2 rate applied to a taxable income of $20,000 per year works out to $40 a year. Currently, someone with a taxable income of $20,000 a year pays $2 worth of jail tax.
The current local income tax rate for Monroe County residents, for all categories, totals 2.035 percent.
Based on a work session held on Friday morning, councilors are looking to decide the rate of the jail tax increase that will be advertised to the public at their next meeting on Aug. 27. If a rate to be advertised is decided, that will allow a public hearing to be set for Sept. 16.
Assuming no intervening amendments to the rate, the council could vote on enactment anytime after Sept. 16. As long as the council acts before Nov. 1, that would make the new rate effective starting Jan. 1, 2025. Continue reading “Monroe County council grinds towards decision on new jail tax rate, could be as high as 0.2%”

