IN COOK COUNTY IL, Are Real Estate Tax Appeals Often Fruitful?
ONLY A SMALL PERCENTAGE OF CHICAGO AREA HOMEOWNERS APPEAL THEIR PROPERTY TAXES - A SIZABLE PORTION ACTUALLY RECEIVE REDUCTIONS!
Cook County IL Tax Assessments! Homeowners here in the Chicago Area FUME when they receive their bills, especially each Fall, when the oft-larger second of two semi-annual installments become due.
The Cook County Tax Assessors Office uses a complicated formula of Tax Rate Multipliers, and Equalized Valuations to assign a value each parcel every three years. They do so, over the last few years in a declining Chicago Area Real Estate Market, based on fewer comparable properties sold, and, often, with much objection after the often higher-than-anticipated end result.
Are you curious about the process? Check out the Cook County Assessor Website for background. Likely, however, you'll know not much more after your visit to the site than you do now!
So, what if you object to your Equalized Assessed Value in Cook County, and the resulting higher property tax bill you will likely receive as a result? Well . . . you have one option as a Property Taxpayer -
APPEAL IT!
But, according to Chicago Tribune Real Estate Reporter Mary Ellen Podmolik, and her review of data from a study done by University of Illinois Professor David McMillen, many of the homeowners most likely to file a Property Tax Appeal were not the ones to be granted relief!
McMillen's study compared the number of those who filed Real Estate Tax Appeals in two different periods - after the 2000, and after the 2003 Tax Bills were issued, each the year after the taxes were actually incurred.
Ten years ago, in 2000, nine percent of property owners in the City of Chicago filed Real Estate Tax Appeals. Of those who appealed, 33% were successful at receiving a reduction. Three years later, after the 2003 RE Tax Bills came out, 14% filed for appeals, and 31% found success and lower taxes.
The U of I Study found that most Real Estate Tax Appeals in Chicago were filed by the more affluent and more educated, living in more upscale Chicago Neighborhoods, many with newer or recently-rehabbed homes.
Many appealed because their neighbors were doing the same. They were often concerned that property valuations were escalating far faster than their household incomes.
Most minority homeowners - in Hispanic and African-American Chicago Neighborhoods - were less likely to appeal their Real Estate Taxes. Others, who bought their Chicago Homes as property values were skyrocketing several years ago, seemed more interested in counting their new-found equity than quibbling over their increasing taxes.
The study concluded that the highest chances for reduced tax rates came in the older Chicago Neighborhoods, such as the Chicago Bungalow Belt Communities of Portage Park, Jefferson Park, and Rogers Park, all on the North Side of Chicago. It is often harder to pin a replacement cost on homes constructed 80 or 90 years ago, and the values of these homes are sometimes understated.
Also, McMillen did not find a greater chance for success with those tax appeals handled by a specialized Tax Appeal Attorney, rather than the homeowner simply filing the necessary documentation and comparable calculations themselves.
In our experience, however, using a specialized attorney, who often gets compensated on a portion of the tax savings, and only if successful, makes good sense. This is especially true if the appeal is escalated to the Cook County Board of Review, or the Property Tax Appeal Board - although the highest level of escalation is rare for residential property.
McMillen feels that those living in areas where few homes have sold have the greatest chances for tax savings, as it can be more easily demonstrated that higher levels of real estate taxes would not be defensible.
DEAN MOSS & DEAN'S TEAM CHICAGO
