What does it cost each year to own a house in Lebanon? For decades the answer sat on one line: the property tax figure on the listing sheet. Starting in 2027, that line may tell you less than it used to. Two changes are moving part of the local tax load off the house and onto other sources. One took effect on October 1. Voters decide the other on November 3.
The listing sheet shows a tax history that was set under the old system, so it looks backward. If you're comparing Lebanon with Springboro, Mason or Franklin this fall, the useful question has changed. Ask what the house will cost a household like yours, given where your income comes from.
Three changes, three different start dates
| Change | Status as of Oct. 22, 2026 | What moves |
|---|---|---|
| Warren County sales tax rises from 6.75% to 7.25% | In effect since Oct. 1, 2026 | County property tax relief, paid for by shoppers |
| Lebanon City Schools 1% earned income tax | On the Nov. 3, 2026 ballot | Paycheck tax for residents beginning Jan. 1, 2027 |
| 1.38-mill property tax rollback | Only if the levy passes | Bond payoff, January 2027 |
| 0.77-mill property tax rollback | Only if the levy passes | Permanent Improvement levy ends, January 2028 |
The Ohio Department of Taxation confirmed the new 7.25% county rate as of October 1, 2026. The school measure would run for 10 years. The ballot asks only about the income tax. The property tax rollback rests on a separate board resolution that has to be read alongside it.
Why a property tax law pushed a school district toward wages
The mechanism starts in Columbus. House Bill 186 took effect March 20, 2026. It created an Inflation Cap Credit that limits growth in certain school district property taxes to the rate of inflation. House Bill 335 took effect the same day and holds growth in inside millage collections to inflation during a county reappraisal or update.
For homeowners, that was the point. For a school district, it means property tax revenue no longer rises as home values rise. Lebanon City Schools says state reform has cut its anticipated revenue by $13 million over the next four years, and that "the district no longer sees increases on its property tax levies."
Superintendent Isaac Seevers described the choice that followed on the district's levy page. "Legislators have encouraged us to diversify our revenue to become less dependent on property taxes," he said, adding that an earned income tax "is scalable." He explained that its revenue grows as new homes in active residential developments fill with wage earners. The district says the 1% tax would raise $13.5 million a year. Raising the same amount from property would take a 7.81-mill levy.
So the state capped one revenue source, and the district is asking voters for a different one that grows with wages rather than home values. New construction used to be what lifted the district's property tax revenue, and under this proposal that role would pass to the wage earners who move into those new homes.
What "earned income" covers
Ohio law defines the earned income base narrowly. Under Ohio Revised Code 5748.01, it means wages, salaries, tips, other employee compensation and net self-employment earnings.
According to the district and the Ohio Department of Taxation, this is how the base breaks down:
- Taxed: wages, salaries, tips, and income from sole proprietorships and partnerships
- Not taxed: pensions, 401(k) withdrawals, Social Security, interest, dividends, capital gains and unemployment benefits
The tax follows where you live, not where you work. Withholding is based on the taxpayer's home school district, so a Lebanon resident who commutes to Cincinnati or Dayton would owe it. The return is the state's Form SD 100. The state requires it when a resident has a liability and recommends filing even without one, to avoid delinquency notices.
None of this replaces the City of Lebanon's municipal income tax. That rate has been 1.5% since January 1, 2024, with a credit of up to 1% for income taxed by the city where you work. The city and school taxes work on different rules, so you can't simply add the two rates.
The same house, two very different tax profiles
The district puts the cost plainly: $10 for every $1,000 of earned income. Take one house and two possible owners. If the levy passes, a household with $90,000 in wages would owe $900 a year in school income tax. A household living on a pension, Social Security and investment income would owe nothing under this tax. Both households would get the same property tax rollback, because the rollback is tied to the house.
On the property side, the district's own example estimates $277.66 in savings on a home valued at $420,000. Your actual figure depends on your parcel. The district suggests looking up the property on the Warren County Auditor's map, opening Tax Bill, then the Distribution tab, and checking the school lines coded 14001 and 20011.
I find this the most practical part of the measure. When two offers come in on the same Lebanon home, the house carries one tax bill. If the levy passes, the people living in it could carry very different totals.
Timing matters too. The district says an earned income tax takes about 18 months to reach full collection. The first rollback phase lands in January 2027 and the second in January 2028.
Warren County already made a similar trade
The county moved first and used the same logic. As WCPO reported in June, commissioners voted unanimously to raise the sales tax by half a percentage point for one year, starting October 1, in exchange for property tax relief. Commissioners cited a University of Cincinnati study finding that 50% to 60% of the dollars spent in the county come from people who live elsewhere. Kings Island and the Cincinnati Premium Outlets are the obvious examples.
"We're trying to leverage what other folks come into the county and spend, to the benefit of our residents," Commissioner David Young told WCPO. The station reported that a home appraised at $300,000 would save about $470, and that the change would show up on the next round of tax bills. The county expects roughly $32 million in property tax savings against about $27 million in new sales tax, with the gap absorbed through the regular budget.
Put the two measures together and Lebanon's direction is clear. The county has already moved part of the cost to the register, and the school district is asking to move part of it to the paycheck. In both cases the house carries less.
Lebanon is not the only district asking
WVXU reported in August that Fairfield, Franklin, North College Hill, Northwest Local and Southwest Local also put earned income tax levies on this fall's ballots. Cincinnati Public Schools switched to a 7-mill property tax after opposition to its income tax plan. The station cited the Ohio School Boards Association: 75% of school income tax proposals failed in the May 2026 election.
Nearby Franklin City Schools is asking for 1.25% with a 1-mill rollback, according to the Dayton Daily News. In Warren County, Kings and Carlisle already appear on the state's list of districts with a school income tax. Lebanon does not, so this would be a new tax there.
Comparing communities on property tax alone now leaves out part of the cost. You can't fully compare two homes in Warren County without knowing which districts tax wages.
What to check before you write an offer
- The November 3 result. If the levy passes, the income tax begins January 1, 2027, and the rollbacks follow in January 2027 and January 2028. If it fails, the district says its forecast shows more money going out than coming in every forecast year, with its fund balance dropping below appropriate levels in 2028.
- The parcel's Distribution tab on the Auditor's site, to see what the school lines cost today.
- Other measures on the same ballot. Turtlecreek Township has a proposed 4.5-mill continuing fire levy, estimated at $158 per $100,000 of appraised value. Countywide renewals for the Mental Health Recovery Board and Senior Services are also on the ballot.
- The valuation calendar. Warren County's next triennial update falls in 2027, under the state schedule. Complaints about tax year 2026 values can be filed with the Board of Revision between January 1 and March 31, 2027.
Quick answers
Why isn't the property tax rollback on the ballot?
The district says Ohio law allows a rollback in income tax ballot language only when the property tax being reduced funds current operations. The 2.15 mills here fund bond debt and permanent improvements, so the board committed to the rollback by resolution in July.
Why 1% and not less?
The district considered 0.75%. It says that rate would have lasted only five years and left no room for property tax relief. The district says the 1% rate is meant to keep it off the ballot for new money until at least 2032.
Is the county sales tax increase permanent?
WCPO reported it as a one-year increase starting October 1, 2026.
This post is general information, not legal, tax or financial advice. Please confirm how these taxes apply to your household with a qualified tax professional.
If you're weighing a Lebanon home this fall, I'm happy to pull a parcel's tax distribution with you and walk through the timeline for both possible ballot outcomes, so the number you plan around reflects your own income. Wenzler Concierge Group is here when you're ready. Schedule your complimentary concierge consultation.
