97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB5439

 

Introduced 2/15/2012, by Rep. Michael J. Zalewski

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 200/15-175
35 ILCS 200/15-177

    Amends the Property Tax Code. Removes language providing that the definition of "homestead property" includes leasehold interests on which a single family residence is situated.


LRB097 17973 HLH 63196 b

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

 

 

A BILL FOR

 

HB5439LRB097 17973 HLH 63196 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
5Sections 15-175 and 15-177 as follows:
 
6    (35 ILCS 200/15-175)
7    Sec. 15-175. General homestead exemption. Except as
8provided in Sections 15-176 and 15-177, homestead property is
9entitled to an annual homestead exemption limited, except as
10described here with relation to cooperatives, to a reduction in
11the equalized assessed value of homestead property equal to the
12increase in equalized assessed value for the current assessment
13year above the equalized assessed value of the property for
141977, up to the maximum reduction set forth below. If however,
15the 1977 equalized assessed value upon which taxes were paid is
16subsequently determined by local assessing officials, the
17Property Tax Appeal Board, or a court to have been excessive,
18the equalized assessed value which should have been placed on
19the property for 1977 shall be used to determine the amount of
20the exemption.
21    Except as provided in Section 15-176, the maximum reduction
22before taxable year 2004 shall be $4,500 in counties with
233,000,000 or more inhabitants and $3,500 in all other counties.

 

 

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1Except as provided in Sections 15-176 and 15-177, for taxable
2years 2004 through 2007, the maximum reduction shall be $5,000,
3for taxable year 2008, the maximum reduction is $5,500, and,
4for taxable years 2009 and thereafter, the maximum reduction is
5$6,000 in all counties. If a county has elected to subject
6itself to the provisions of Section 15-176 as provided in
7subsection (k) of that Section, then, for the first taxable
8year only after the provisions of Section 15-176 no longer
9apply, for owners who, for the taxable year, have not been
10granted a senior citizens assessment freeze homestead
11exemption under Section 15-172 or a long-time occupant
12homestead exemption under Section 15-177, there shall be an
13additional exemption of $5,000 for owners with a household
14income of $30,000 or less.
15    In counties with fewer than 3,000,000 inhabitants, if,
16based on the most recent assessment, the equalized assessed
17value of the homestead property for the current assessment year
18is greater than the equalized assessed value of the property
19for 1977, the owner of the property shall automatically receive
20the exemption granted under this Section in an amount equal to
21the increase over the 1977 assessment up to the maximum
22reduction set forth in this Section.
23    If in any assessment year beginning with the 2000
24assessment year, homestead property has a pro-rata valuation
25under Section 9-180 resulting in an increase in the assessed
26valuation, a reduction in equalized assessed valuation equal to

 

 

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1the increase in equalized assessed value of the property for
2the year of the pro-rata valuation above the equalized assessed
3value of the property for 1977 shall be applied to the property
4on a proportionate basis for the period the property qualified
5as homestead property during the assessment year. The maximum
6proportionate homestead exemption shall not exceed the maximum
7homestead exemption allowed in the county under this Section
8divided by 365 and multiplied by the number of days the
9property qualified as homestead property.
10    "Homestead property" under this Section includes
11residential property that is occupied by its owner or owners as
12his or their principal dwelling place, or that is a leasehold
13interest on which a single family residence is situated, which
14is occupied as a residence by a person who has an ownership
15interest therein, legal or equitable or as a lessee, and on
16which the person is liable for the payment of property taxes.
17For land improved with an apartment building owned and operated
18as a cooperative or a building which is a life care facility as
19defined in Section 15-170 and considered to be a cooperative
20under Section 15-170, the maximum reduction from the equalized
21assessed value shall be limited to the increase in the value
22above the equalized assessed value of the property for 1977, up
23to the maximum reduction set forth above, multiplied by the
24number of apartments or units occupied by a person or persons
25who is liable, by contract with the owner or owners of record,
26for paying property taxes on the property and is an owner of

 

 

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

 

 

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1to receive the homestead exemption and the amount of the
2exemption by application, visual inspection, questionnaire or
3other reasonable methods. The determination shall be made in
4accordance with guidelines established by the Department,
5provided that the taxpayer applying for an additional general
6exemption under this Section shall submit to the chief county
7assessment officer an application with an affidavit of the
8applicant's total household income, age, marital status (and,
9if married, the name and address of the applicant's spouse, if
10known), and principal dwelling place of members of the
11household on January 1 of the taxable year. The Department
12shall issue guidelines establishing a method for verifying the
13accuracy of the affidavits filed by applicants under this
14paragraph. The applications shall be clearly marked as
15applications for the Additional General Homestead Exemption.
16    In counties with fewer than 3,000,000 inhabitants, in the
17event of a sale of homestead property the homestead exemption
18shall remain in effect for the remainder of the assessment year
19of the sale. The assessor or chief county assessment officer
20may require the new owner of the property to apply for the
21homestead exemption for the following assessment year.
22    Notwithstanding Sections 6 and 8 of the State Mandates Act,
23no reimbursement by the State is required for the
24implementation of any mandate created by this Section.
25(Source: P.A. 95-644, eff. 10-12-07.)
 

 

 

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1    (35 ILCS 200/15-177)
2    Sec. 15-177. The long-time occupant homestead exemption.
3    (a) If the county has elected, under Section 15-176, to be
4subject to the provisions of the alternative general homestead
5exemption, then, for taxable years 2007 and thereafter,
6regardless of whether the exemption under Section 15-176
7applies, qualified homestead property is entitled to an annual
8homestead exemption equal to a reduction in the property's
9equalized assessed value calculated as provided in this
10Section.
11    (b) As used in this Section:
12    "Adjusted homestead value" means the lesser of the
13following values:
14        (1) The property's base homestead value increased by:
15    (i) 10% for each taxable year after the base year through
16    and including the current tax year for qualified taxpayers
17    with a household income of more than $75,000 but not
18    exceeding $100,000; or (ii) 7% for each taxable year after
19    the base year through and including the current tax year
20    for qualified taxpayers with a household income of $75,000
21    or less. The increase each year is an increase over the
22    prior year; or
23        (2) The property's equalized assessed value for the
24    current tax year minus the general homestead deduction.
25    "Base homestead value" means:
26        (1) if the property did not have an adjusted homestead

 

 

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1    value under Section 15-176 for the base year, then an
2    amount equal to the equalized assessed value of the
3    property for the base year prior to exemptions, minus the
4    general homestead deduction, provided that the property's
5    assessment was not based on a reduced assessed value
6    resulting from a temporary irregularity in the property for
7    that year; or
8        (2) if the property had an adjusted homestead value
9    under Section 15-176 for the base year, then an amount
10    equal to the adjusted homestead value of the property under
11    Section 15-176 for the base year.
12    "Base year" means the taxable year prior to the taxable
13year in which the taxpayer first qualifies for the exemption
14under this Section.
15    "Current taxable year" means the taxable year for which the
16exemption under this Section is being applied.
17    "Equalized assessed value" means the property's assessed
18value as equalized by the Department.
19    "Homestead" or "homestead property" means residential
20property that as of January 1 of the tax year is occupied by a
21qualified taxpayer as his or her principal dwelling place, or
22that is a leasehold interest on which a single family residence
23is situated, that is occupied as a residence by a qualified
24taxpayer who has a legal or equitable interest therein
25evidenced by a written instrument, as an owner or as a lessee,
26and on which the person is liable for the payment of property

 

 

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1taxes. Residential units in an apartment building owned and
2operated as a cooperative, or as a life care facility, which
3are occupied by persons who hold a legal or equitable interest
4in the cooperative apartment building or life care facility as
5owners or lessees, and who are liable by contract for the
6payment of property taxes, are included within this definition
7of homestead property. A homestead includes the dwelling place,
8appurtenant structures, and so much of the surrounding land
9constituting the parcel on which the dwelling place is situated
10as is used for residential purposes. If the assessor has
11established a specific legal description for a portion of
12property constituting the homestead, then the homestead is
13limited to the property within that description.
14    "Household income" has the meaning set forth under Section
1515-172 of this Code.
16    "General homestead deduction" means the amount of the
17general homestead exemption under Section 15-175.
18    "Life care facility" means a facility defined in Section 2
19of the Life Care Facilities Act.
20    "Qualified homestead property" means homestead property
21owned by a qualified taxpayer.
22    "Qualified taxpayer" means any individual:
23        (1) who, for at least 10 continuous years as of January
24    1 of the taxable year, has occupied the same homestead
25    property as a principal residence and domicile or who, for
26    at least 5 continuous years as of January 1 of the taxable

 

 

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1    year, has occupied the same homestead property as a
2    principal residence and domicile if that person received
3    assistance in the acquisition of the property as part of a
4    government or nonprofit housing program; and
5        (2) who has a household income of $100,000 or less.
6    (c) The base homestead value must remain constant, except
7that the assessor may revise it under any of the following
8circumstances:
9        (1) If the equalized assessed value of a homestead
10    property for the current tax year is less than the previous
11    base homestead value for that property, then the current
12    equalized assessed value (provided it is not based on a
13    reduced assessed value resulting from a temporary
14    irregularity in the property) becomes the base homestead
15    value in subsequent tax years.
16        (2) For any year in which new buildings, structures, or
17    other improvements are constructed on the homestead
18    property that would increase its assessed value, the
19    assessor shall adjust the base homestead value with due
20    regard to the value added by the new improvements.
21    (d) The amount of the exemption under this Section is the
22greater of: (i) the equalized assessed value of the homestead
23property for the current tax year minus the adjusted homestead
24value; or (ii) the general homestead deduction.
25    (e) In the case of an apartment building owned and operated
26as a cooperative, or as a life care facility, that contains

 

 

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1residential units that qualify as homestead property of a
2qualified taxpayer under this Section, the maximum cumulative
3exemption amount attributed to the entire building or facility
4shall not exceed the sum of the exemptions calculated for each
5unit that is a qualified homestead property. The cooperative
6association, management firm, or other person or entity that
7manages or controls the cooperative apartment building or life
8care facility shall credit the exemption attributable to each
9residential unit only to the apportioned tax liability of the
10qualified taxpayer as to that unit. Any person who willfully
11refuses to so credit the exemption is guilty of a Class B
12misdemeanor.
13    (f) When married persons maintain separate residences, the
14exemption provided under this Section may be claimed by only
15one such person and for only one residence. No person who
16receives an exemption under Section 15-172 of this Code may
17receive an exemption under this Section. No person who receives
18an exemption under this Section may receive an exemption under
19Section 15-175 or 15-176 of this Code.
20    (g) In the event of a sale or other transfer in ownership
21of the homestead property between spouses or between a parent
22and a child, the exemption under this Section remains in effect
23if the new owner has a household income of $100,000 or less.
24    (h) In the event of a sale or other transfer in ownership
25of the homestead property other than subsection (g) of this
26Section, the exemption under this Section shall remain in

 

 

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1effect for the remainder of the tax year and be calculated
2using the same base homestead value in which the sale or
3transfer occurs.
4    (i) To receive the exemption, a person must submit an
5application to the county assessor during the period specified
6by the county assessor.
7    The county assessor shall annually give notice of the
8application period by mail or by publication.
9    The taxpayer must submit, with the application, an
10affidavit of the taxpayer's total household income, marital
11status (and if married the name and address of the applicant's
12spouse, if known), and principal dwelling place of members of
13the household on January 1 of the taxable year. The Department
14shall establish, by rule, a method for verifying the accuracy
15of affidavits filed by applicants under this Section, and the
16Chief County Assessment Officer may conduct audits of any
17taxpayer claiming an exemption under this Section to verify
18that the taxpayer is eligible to receive the exemption. Each
19application shall contain or be verified by a written
20declaration that it is made under the penalties of perjury. A
21taxpayer's signing a fraudulent application under this Act is
22perjury, as defined in Section 32-2 of the Criminal Code of
231961. The applications shall be clearly marked as applications
24for the Long-time Occupant Homestead Exemption and must contain
25a notice that any taxpayer who receives the exemption is
26subject to an audit by the Chief County Assessment Officer.

 

 

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1    (j) Notwithstanding Sections 6 and 8 of the State Mandates
2Act, no reimbursement by the State is required for the
3implementation of any mandate created by this Section.
4(Source: P.A. 95-644, eff. 10-12-07.)