What Do I Need to Know About My Property Tax Assessment?

Do you feel your property taxes are too high? Welcome to Illinois! However, there is reasoning behind your assessment. I hope this article answers your questions.

The property tax is defined using the Latin term ad valorem or “according to value.” Your township assessor's role in the property tax cycle is to appraise the value of real property for the purpose of determining your share of the tax burden. 

The assessor’s duty is to estimate the value of property by applying 3 possible valuation approaches:

1. Derive value by using valid MARKET SALES data
2. Estimate the COST of construction of real property + the cost value of the land
3. Calculate the value using INCOME of an income-producing property

Within the property tax system, the property owner’s rights are protected and ascribed in the U.S. Constitution’s 14th Amendment: “No person shall be deprived of life, liberty or property without due process of law nor equal protection of the laws” (emphasis added). In layman’s terms: Under the 14th Amendment’s “Equal Protection Clause,” the assessor is to fairly apportion the tax burden. The property tax is a unique tax in comparison to other forms of taxation because under the 14th Amendment’s “Due Process Clause,” the property owner is given the right of appeal of the assessed value of the property.

As previously stated, the assessor’s role in the property tax cycle is to appraise value. An appraisal is simply an opinion of value. Stated again: An appraisal is an opinion of value and not a fact, but it should be based on facts. The property owner most often has their own opinion of what their property is worth, and their opinion of value can greatly differ from the assessor’s. The “Due Process Clause” is the basis for the property owner’s right of appeal, which offers two stages of appeal.

Prior to appealing, it is strongly suggested that an owner initiate a conversation with the assessor about the property’s value and the facts surrounding the property. The assessor values real property using a mass appraisal system, by which the properties are segmented into “neighborhoods” or large groups of competing properties. The assessor is not valuing property on an individual basis such as a private appraiser might for a bank. The private appraiser applies much more detail into their appraisals as gathered through both interior and exterior inspection of the property. In a mass appraisal system, the assessor rarely views the inside of a structure even though tens of thousands of properties are being valued. Often the assessor is “judging a book by its cover,” assuming a property’s exterior equally reflects its interior condition and quality. Often a difference of opinion arises out of the inability of the assessor to accurately know the amenities and condition of a structure. Comparing the assessor's record of the property to the realities of that property can often resolve a difference of opinion of value.

Regardless of whether there is agreement on the value, the property owner each year has the right of appeal. The first stage of appeal occurs at the local level where an appeal can be filed with the Board of Review. An appeal must be filed within 30 days of publication of the current assessments in the newspaper that has the highest circulation within each township. When does this typically occur? Normally in Peoria County, the issuance of new assessments and their publication occurs in August, but sometimes it has been later. An appeal must be based on:

1. Market Sales
2. Equity of Assessments
3. Income of the Property

Once the Board of Review issues its written decision, the owner has 30 days from the date of the Board’s decision letter to file an appeal to the Property Tax Appeal Board (PTAB) in Springfield.

It is critical for homeowners to be aware of tax relief that is available through Homestead exemptions:

TAX RELIEF for PRIMARY-RESIDENCE HOMEOWNERS through HOMESTEAD EXEMPTIONS:

* OWNER-OCCUPIED EXEMPTION: $6,000 exemption applied against the equalized assessed value

* SENIOR EXEMPTION: $5,000 exemption applied against the equalized assessed value for owners 65 years & older

* SENIOR ASSESSMENT FREEZE: Homeowners, who are 65 years & older with yearly qualified total household income under $65,000, may freeze the assessment but not the tax rate.

* HOME IMPROVEMENT EXEMPTION: 4-yr exemption up to $25,000 of increased assessed value applied against the equalized assessed value

* DISABLED PERSONS EXEMPTION: $2,000 exemption applied against the equalized assessed value

* DISABLED VETERAN EXEMPTION: $2,500, $5,000 or 100% Tax Exempt – based on VETERANS ADMINISTRATION-determined percent of service-related disability.

Your assessor or the Supervisor of Assessments can discuss details of the exemptions and/or confirm which ones you qualify for.