The Illinois Legislature has passed an amendment, effective immediately, to the Illinois Property Tax Code adding a new section to the law at 35 ILCS 200/9-275. The law, which has been long opposed by Illinois landlords, allows the county assessor to go back as many as six assessment years (depending on the number of exemptions claimed) prior to the current assessment year, to record a tax lien against a parcel that was granted an improper property tax exemption. Exemptions that the assessor can challenge are the disabled veteran exemption, returning veteran exemption, disabled person exemption, disabled veteran standard homestead, senior citizen exemption, senior citizens assessment freeze, general homestead exemption, alternative general homestead exemption, and long-time occupant exemption.
Illinois landlords must be careful to not claim exemptions on their non-qualifying rental property. In many cases, exemptions can be claimed erroneously. In many counties, the exemptions, once taken, are automatically applied to subsequent tax years. A homeowner who qualifies for the exemption and later moves out and rents the real estate might not qualify in subsequent years but may still be given the tax exemption without having given it much thought.
Luckily, the law does have a few exemptions from penalties and interest in certain circumstances (ie. certain owners related to a previous owner or who inherited a property, owners who received the exemption based on the assessor’s clerical error, or certain bonafide purchasers who had no knowledge of the erroneous exemptions).
However, I suspect that there are a number of landlords out there who know that they are receiving an exemption in error. The free ride is over. More information on the kinds of exemptions available in Cook County and a lookup for the exemptions applied to a particular parcel of real estate are contained on the Cook County Assessor’s website.