Where To Live: Iowa or Illinois?

When it comes to where to live, which side of the bridge is best?  Iowa or Illinois?

Every day, thousands of people drive back and forth over our bridges to go to work, school, to shop and to play.

“It’s a bigger deal today than it was a few years ago,” says Financial Expert, John Miller.

We sat down with John to find out what he tells his clients.

“The disadvantage is the real property tax and in Illinois, that is quite a bit higher than you’ll experience in Iowa,” says Miller.

So, we decided to put it to the test by comparing Davenport to Moline.

In Davenport, the average price for a house, according to the U.S. Census, is $112,300. We found one house in Davenport selling for $112,500 with property taxes set at $1,844.

In Moline, the average price for a house, according to the U.S. Census, is $107,600.  We found one house in Moline selling for $108,000 with property taxes set at $2,245.00

So far, Moline is more expensive.  But then we factored in income taxes.

In Davenport, the average income — according to the U.S. Census — is $43,676.  In Iowa, income tax is based on a graduated scale, so the average income is taxed 7.98%, totaling $3,459.14.

In Moline, the average income according to the U.S. Census is $47,431. In Illinois, income tax is the same for everyone, so the average income is taxed 5%, totaling $2,371.55.

In this case, Moline is less expensive.  However, the totals when you add up property tax and income tax — $5,303.14 for Davenport and $4,616.55 for Moline — differ by less than $1,000.  

So, does money matter?

“What we find is people might say, ‘Oh, I want to buy a three-bedroom ranch in Davenport,’ and they end up buying a four-bedroom two-story in Moline,” says Ruhl & Ruhl’s Vice-President of Relocation, Roni Pianca,

Roni says it’s not always about the paycheck or property taxes, but the place.

“If there was a big draw in either direction, people would be moving in that direction.  But what we find, especially with the locals, is it’s usually where you’re the most comfortable and where you’ve grown up, and where you tend to stay,” says Roni.

So what do John and Roni do with someone new to the area?

“We get them in the car and give them a community tour,” says Roni.

“We look into their individual situation and analyze their tax liability,” says John.

So, Iowa or Illinois is not necessarily the question.  It’s what is best for each person coming across the bridge.

“You can’t get too carried away with this whole analysis or else we’d be moving back and forth across the river all the time,” says John.

John also says you need to factor in tax deductions, like how many kids you have, because that is different in each state as well.

John says the only case where one state really reigns supreme over the other is when you hit retirement age, because Illinois doesn’t tax retirement or Social Security income.