100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB5732

 

Introduced , by Rep. David S. Olsen

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 200/15-175

    Amends the Property Tax Code. Provides that the maximum reduction under the General Homestead Exemption is $10,000 in all counties. Indexes the maximum reductions in all counties to the Consumer Price Index. Effective immediately.


LRB100 20894 HLH 36400 b

FISCAL NOTE ACT MAY APPLY
HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB5732LRB100 20894 HLH 36400 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Property Tax Code is amended by changing
5Section 15-175 as follows:
 
6    (35 ILCS 200/15-175)
7    Sec. 15-175. General homestead exemption.
8    (a) Except as provided in Sections 15-176 and 15-177,
9homestead property is entitled to an annual homestead exemption
10limited, except as described here with relation to
11cooperatives, to a reduction in the equalized assessed value of
12homestead property equal to the increase in equalized assessed
13value for the current assessment year above the equalized
14assessed value of the property for 1977, up to the maximum
15reduction set forth below. If however, the 1977 equalized
16assessed value upon which taxes were paid is subsequently
17determined by local assessing officials, the Property Tax
18Appeal Board, or a court to have been excessive, the equalized
19assessed value which should have been placed on the property
20for 1977 shall be used to determine the amount of the
21exemption.
22    (b) Except as provided in Section 15-176, the maximum
23reduction before taxable year 2004 shall be $4,500 in counties

 

 

HB5732- 2 -LRB100 20894 HLH 36400 b

1with 3,000,000 or more inhabitants and $3,500 in all other
2counties. Except as provided in Sections 15-176 and 15-177, for
3taxable years 2004 through 2007, the maximum reduction shall be
4$5,000, for taxable year 2008, the maximum reduction is $5,500,
5and, for taxable years 2009 through 2011, the maximum reduction
6is $6,000 in all counties. For taxable years 2012 through 2016,
7the maximum reduction is $7,000 in counties with 3,000,000 or
8more inhabitants and $6,000 in all other counties. For taxable
9year years 2017 and thereafter, the maximum reduction is
10$10,000 in counties with 3,000,000 or more inhabitants and
11$6,000 in all other counties. For taxable year 2018, the
12maximum reduction is $10,000 in all counties; thereafter, the
13maximum reduction is the maximum reduction for the prior
14taxable year increased by the annual rate of increase for the
15previous calendar year in the Consumer Price Index for All
16Urban Consumers for all items published by the United States
17Bureau of Labor Statistics. If a county has elected to subject
18itself to the provisions of Section 15-176 as provided in
19subsection (k) of that Section, then, for the first taxable
20year only after the provisions of Section 15-176 no longer
21apply, for owners who, for the taxable year, have not been
22granted a senior citizens assessment freeze homestead
23exemption under Section 15-172 or a long-time occupant
24homestead exemption under Section 15-177, there shall be an
25additional exemption of $5,000 for owners with a household
26income of $30,000 or less.

 

 

HB5732- 3 -LRB100 20894 HLH 36400 b

1    (c) In counties with fewer than 3,000,000 inhabitants, if,
2based on the most recent assessment, the equalized assessed
3value of the homestead property for the current assessment year
4is greater than the equalized assessed value of the property
5for 1977, the owner of the property shall automatically receive
6the exemption granted under this Section in an amount equal to
7the increase over the 1977 assessment up to the maximum
8reduction set forth in this Section.
9    (d) If in any assessment year beginning with the 2000
10assessment year, homestead property has a pro-rata valuation
11under Section 9-180 resulting in an increase in the assessed
12valuation, a reduction in equalized assessed valuation equal to
13the increase in equalized assessed value of the property for
14the year of the pro-rata valuation above the equalized assessed
15value of the property for 1977 shall be applied to the property
16on a proportionate basis for the period the property qualified
17as homestead property during the assessment year. The maximum
18proportionate homestead exemption shall not exceed the maximum
19homestead exemption allowed in the county under this Section
20divided by 365 and multiplied by the number of days the
21property qualified as homestead property.
22    (d-1) In counties with 3,000,000 or more inhabitants, where
23the chief county assessment officer provides a notice of
24discovery, if a property is not occupied by its owner as a
25principal residence as of January 1 of the current tax year,
26then the property owner shall notify the chief county

 

 

HB5732- 4 -LRB100 20894 HLH 36400 b

1assessment officer of that fact on a form prescribed by the
2chief county assessment officer. That notice must be received
3by the chief county assessment officer on or before March 1 of
4the collection year. If mailed, the form shall be sent by
5certified mail, return receipt requested. If the form is
6provided in person, the chief county assessment officer shall
7provide a date stamped copy of the notice. Failure to provide
8timely notice pursuant to this subsection (d-1) shall result in
9the exemption being treated as an erroneous exemption. Upon
10timely receipt of the notice for the current tax year, no
11exemption shall be applied to the property for the current tax
12year. If the exemption is not removed upon timely receipt of
13the notice by the chief assessment officer, then the error is
14considered granted as a result of a clerical error or omission
15on the part of the chief county assessment officer as described
16in subsection (h) of Section 9-275, and the property owner
17shall not be liable for the payment of interest and penalties
18due to the erroneous exemption for the current tax year for
19which the notice was filed after the date that notice was
20timely received pursuant to this subsection. Notice provided
21under this subsection shall not constitute a defense or amnesty
22for prior year erroneous exemptions.
23    For the purposes of this subsection (d-1):
24    "Collection year" means the year in which the first and
25second installment of the current tax year is billed.
26    "Current tax year" means the year prior to the collection

 

 

HB5732- 5 -LRB100 20894 HLH 36400 b

1year.
2    (e) The chief county assessment officer may, when
3considering whether to grant a leasehold exemption under this
4Section, require the following conditions to be met:
5        (1) that a notarized application for the exemption,
6    signed by both the owner and the lessee of the property,
7    must be submitted each year during the application period
8    in effect for the county in which the property is located;
9        (2) that a copy of the lease must be filed with the
10    chief county assessment officer by the owner of the
11    property at the time the notarized application is
12    submitted;
13        (3) that the lease must expressly state that the lessee
14    is liable for the payment of property taxes; and
15        (4) that the lease must include the following language
16    in substantially the following form:
17            "Lessee shall be liable for the payment of real
18        estate taxes with respect to the residence in
19        accordance with the terms and conditions of Section
20        15-175 of the Property Tax Code (35 ILCS 200/15-175).
21        The permanent real estate index number for the premises
22        is (insert number), and, according to the most recent
23        property tax bill, the current amount of real estate
24        taxes associated with the premises is (insert amount)
25        per year. The parties agree that the monthly rent set
26        forth above shall be increased or decreased pro rata

 

 

HB5732- 6 -LRB100 20894 HLH 36400 b

1        (effective January 1 of each calendar year) to reflect
2        any increase or decrease in real estate taxes. Lessee
3        shall be deemed to be satisfying Lessee's liability for
4        the above mentioned real estate taxes with the monthly
5        rent payments as set forth above (or increased or
6        decreased as set forth herein).".
7    In addition, if there is a change in lessee, or if the
8lessee vacates the property, then the chief county assessment
9officer may require the owner of the property to notify the
10chief county assessment officer of that change.
11    This subsection (e) does not apply to leasehold interests
12in property owned by a municipality.
13    (f) "Homestead property" under this Section includes
14residential property that is occupied by its owner or owners as
15his or their principal dwelling place, or that is a leasehold
16interest on which a single family residence is situated, which
17is occupied as a residence by a person who has an ownership
18interest therein, legal or equitable or as a lessee, and on
19which the person is liable for the payment of property taxes.
20For land improved with an apartment building owned and operated
21as a cooperative or a building which is a life care facility as
22defined in Section 15-170 and considered to be a cooperative
23under Section 15-170, the maximum reduction from the equalized
24assessed value shall be limited to the increase in the value
25above the equalized assessed value of the property for 1977, up
26to the maximum reduction set forth above, multiplied by the

 

 

HB5732- 7 -LRB100 20894 HLH 36400 b

1number of apartments or units occupied by a person or persons
2who is liable, by contract with the owner or owners of record,
3for paying property taxes on the property and is an owner of
4record of a legal or equitable interest in the cooperative
5apartment building, other than a leasehold interest. For
6purposes of this Section, the term "life care facility" has the
7meaning stated in Section 15-170.
8    "Household", as used in this Section, means the owner, the
9spouse of the owner, and all persons using the residence of the
10owner as their principal place of residence.
11    "Household income", as used in this Section, means the
12combined income of the members of a household for the calendar
13year preceding the taxable year.
14    "Income", as used in this Section, has the same meaning as
15provided in Section 3.07 of the Senior Citizens and Persons
16with Disabilities Property Tax Relief Act, except that "income"
17does not include veteran's benefits.
18    (g) In a cooperative where a homestead exemption has been
19granted, the cooperative association or its management firm
20shall credit the savings resulting from that exemption only to
21the apportioned tax liability of the owner who qualified for
22the exemption. Any person who willfully refuses to so credit
23the savings shall be guilty of a Class B misdemeanor.
24    (h) Where married persons maintain and reside in separate
25residences qualifying as homestead property, each residence
26shall receive 50% of the total reduction in equalized assessed

 

 

HB5732- 8 -LRB100 20894 HLH 36400 b

1valuation provided by this Section.
2    (i) In all counties, the assessor or chief county
3assessment officer may determine the eligibility of
4residential property to receive the homestead exemption and the
5amount of the exemption by application, visual inspection,
6questionnaire or other reasonable methods. The determination
7shall be made in accordance with guidelines established by the
8Department, provided that the taxpayer applying for an
9additional general exemption under this Section shall submit to
10the chief county assessment officer an application with an
11affidavit of the applicant's total household income, age,
12marital status (and, if married, the name and address of the
13applicant's spouse, if known), and principal dwelling place of
14members of the household on January 1 of the taxable year. The
15Department shall issue guidelines establishing a method for
16verifying the accuracy of the affidavits filed by applicants
17under this paragraph. The applications shall be clearly marked
18as applications for the Additional General Homestead
19Exemption.
20    (i-5) This subsection (i-5) applies to counties with
213,000,000 or more inhabitants. In the event of a sale of
22homestead property, the homestead exemption shall remain in
23effect for the remainder of the assessment year of the sale.
24Upon receipt of a transfer declaration transmitted by the
25recorder pursuant to Section 31-30 of the Real Estate Transfer
26Tax Law for property receiving an exemption under this Section,

 

 

HB5732- 9 -LRB100 20894 HLH 36400 b

1the assessor shall mail a notice and forms to the new owner of
2the property providing information pertaining to the rules and
3applicable filing periods for applying or reapplying for
4homestead exemptions under this Code for which the property may
5be eligible. If the new owner fails to apply or reapply for a
6homestead exemption during the applicable filing period or the
7property no longer qualifies for an existing homestead
8exemption, the assessor shall cancel such exemption for any
9ensuing assessment year.
10    (j) In counties with fewer than 3,000,000 inhabitants, in
11the event of a sale of homestead property the homestead
12exemption shall remain in effect for the remainder of the
13assessment year of the sale. The assessor or chief county
14assessment officer may require the new owner of the property to
15apply for the homestead exemption for the following assessment
16year.
17    (k) Notwithstanding Sections 6 and 8 of the State Mandates
18Act, no reimbursement by the State is required for the
19implementation of any mandate created by this Section.
20(Source: P.A. 99-143, eff. 7-27-15; 99-164, eff. 7-28-15;
2199-642, eff. 7-28-16; 99-851, eff. 8-19-16; 100-401, eff.
228-25-17.)
 
23    Section 99. Effective date. This Act takes effect upon
24becoming law.