UNDERSTANDING REAL ESTATE TAXES
When you purchase property, it is a rewarding and satisfying achievement. Owning property is key to sustaining wealth, financial stability, and success. In this process, however, your tax responsibility changes as real estate taxes are added to your list of bills. Here is a guide that can explain the taxation process for the state of Illinois and give you an idea of your rights as a taxpayer.
How Are You Taxed?
In Illinois, your property taxes are based on two things:
- the equalized assessed value (EAV) of your property
- the amount of money your local taxing districts need to operate during the coming year.
The way that real estate taxes work can be quite confusing: your property value can increase, but your real estate taxes may not change or may even decrease because the tax base has increased, or because levies (taxation that is assessed for local government operation) by your taxing district decreased.
Conversely, the opposite could happen as well. Your property value could decrease, but the tax base in your local government could decrease along with it, or levies from your taxing district could increase. These changes could cause an increase in your property tax, even if the value of your property fell.
Because of these variables, it’s important to pay attention to your property’s assessed value and any changes that might occur in your local government’s budget and taxation. Changes in your property value affect the value of your investment. Increases in property taxes assessed by your local government can easily cause a dent in your wallet.
Is My Assessment Fair?
The Illinois Department of Revenue states that when assessments take place, a full list of every property assessed must be printed in a public newspaper published within the county. In the years when general assessments do not take place, a list will be published of only those properties that experienced a change in value.
For counties other than Cook, all taxpayers must be sent notice if the value of their property changes from the preceding year, unless the change is due to an equalization factor applied by the chief county assessment officer. Notice will be sent to the mortgage lenders in the case of tenants who are renting a property, but mortgage lenders are required to forward copies of the notices to mortgagors.
Each property, with the exception of farmland, is viewed, inspected, and revalued every three years in Cook County and every four years everywhere else. Farmland, as an exception, is reassessed every year. In other years when a general assessment is not taking place, assessors may revalue a property if they feel the current value is not accurate.
All real property assessments are public record. If you need to locate information for your property, you can contact the Supervisor of Assessments for your locality. Their information is posted on the Illinois Department of Revenue’s
You can judge whether your property assessment is fair in two ways:
- Compare the fair market value of your property to the prices of properties in your area that are similar to yours that are for sale. This is a good method to use if you’ve recently purchased your home or if you’ve just had an appraisal done.
- Compare the assessed value of your home to the assessed values of similar homes in your area that are for sale. This will give you an idea of the uniformity of assessments and whether there is a discrepancy in yours in comparison to the assessed value of properties like yours.
The property tax cycle in Illinois runs over a two-year period. What that means is that the property taxes that you pay in the current year are based on the assessment from the prior year. For instance, your real estate taxes for a 2015 assessment will be paid in 2016. This is important to understand mainly because of the amount that you’re taxed. Since the tax is based on real property assessments conducted by your local municipality, by the time you receive your property tax bill, it might be too late to appeal your assessment.
Understanding your rights as a property owner is important, and if you feel that you’ve been unfairly assessed, consulting the advice of an attorney could work to your advantage.The attorneys at www.chicagorealestatelawfirm.com would be glad to look at your real estate taxes and guide you through the appeal process if there are grounds to do so. Contact them today to take advantage of their real estate law expertise.
This post originally appeared at https://www.chicagorealestatelawfirm.com/understanding-real-estate-taxes/
