April 7, 2010
The Civic Federation recently published a primer on the Cook County Property Assessment Process. It explains many features of the complex property tax system that ordinary taxpayers may have heard of but never understood, such as classification and equalization, and traces all the steps taken to arrive at a parcel’s final taxable value.
The report reviews modifications to the classification system, including the recent “10 and 25” change to assessment levels. It also provides multi-year data trends on assessed values, median levels of assessment, homestead and senior exemptions, and taxable value of real estate. The graph below shows the trend in median levels of assessment as computed by the Illinois Department of Revenue. The median level for commercial and industrial properties fell from roughly 30% in 1994 to approximately 17% in 2007 (What does this mean? Read the primer to find out.)
The primer explains the computation of the “7% homeowner exemption” and shows the maximum values of that exemption by assessment district and year. Illinois state statutes currently authorize ten homestead exemptions that are available to different types of homeowners such as senior citizens, disabled persons, long-time residents, and veterans. Four of these exemptions were first enacted in 2007 and the others have been modified over the years.
The total value of homestead exemptions in Cook County has grown substantially in recent years. In 1999, homestead exemptions removed 5.0% of gross equalized assessed value (EAV) in Cook County from the final taxable value. In 2008, homestead exemptions exempted 12.6% of gross EAV from taxation.
This increase in the value of homestead exemptions is due in large part to the introduction of the “7%” exemption and the Senior Citizens Assessment Freeze Exemption, which increased by 979.6%, or $4.7 billion of EAV in ten years, growing from $0.5 billion in 1999 to $5.2 billion in 2008.
This report is the second in a series of four primers being produced by the Civic Federation. The previous primer released in November 2009 described the property tax appeals process at the Cook County Assessor’s Office and the Board of Review. The Federation has undertaken this primer series in order to provide the public with clear and accurate information about the Cook County property tax system.