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Are Illinois property taxes leaving you feeling confused and overtaxed? Looking for a good strategy to correct the valuation and taxation of your property?

Let’s start with a primer on the terms found on property tax assessments and bills. Understanding these may help you feel more comfortable and confident in seeking remedies for fairer property tax treatment.

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As we depart the final throws of summer—sports games, barbeques, yet another golf scramble, rushed vacations, and attempts to keep the lawn green and presentable (or at least looking better than the neighbor’s)—you may be spending more time out on the land. And in Illinois, as nearly anywhere in the U.S., where there is land, there are property taxes. This is also the time of year when real estate assessment cards arrive in our mailboxes for residential, business, industrial, and farm properties.

Your first instinct upon seeing your assessment card or property tax bill may be the lines from the adage “nothing is certain but death and taxes.” Taxes seem to rise ever higher with no end in sight, but you do have a right to challenge your assessment and property taxes to secure fairer treatment of your property. As mentioned earlier, step one is becoming familiar with the basic terms found on Illinois property tax assessments and bills. 

Future articles will discuss property tax exemptions, particularly for residential properties, as well as more complex issues regarding commercial and industrial properties.

The Mystery: Understanding the Terminology

Fair Market Value (Valuation) – Amount of money the Assessor believes your property would bring at a fair and open sale “at arm’s length” to the buyer.

Non-Farm Assessment (Assessed Value) - Illinois tax law uses the term “Non-Farm” since farmland is taxed differently than all other land in Illinois. Essentially, if no farmland is part of the property on the tax bill, the Non-Farm Assessment is simply one-third of the Fair Market Value of the property. (That’s because Illinois property taxes are calculated based upon 33 and 1/3% of the property’s Fair Market Value or Valuation.”)

Property Tax Cycle – In Illinois, this is a two-year process. Taxes payable in 2024 are taxes on the property as of the Assessed Value of your property on January 1, 2023. (Think of your property taxes as “tax year 2023, payable in 2024.”) During the tax cycle you may receive a number of documents regarding your property from both the Assessor and the Treasurer, but these are not all directly tax bills. Other documents may include notices of Quadrennial Assessments (see below), notices of Township Multipliers (see below), and the ultimate tax bill.

Quadrennial Assessment – The assessment values of property in a county are reviewed and possibly adjusted every four years. Not all properties within the county are reviewed at the same time. Counties are divided into four assessment districts, with one of the four districts being reviewed each year. The Quadrennial Assessment of your property also allows for an opportunity to formally or informally contest a changed valuation.

Township – Unit of government between villages and cities and the county level of government. Most Illinois counties (84 of 102) are divided into townships, which collect taxes and assist in maintaining roadways. In some instances, the Township may have its own assessor.

Parcel Identification Number (PIN) –Fifteen-digit number (separated by dashes) that’s used by a county to identify your property on the documents and maps of the county. The PIN also identifies the township where the property is located.

Township Multiplier – A number that the Non-Farm Assessment or Assessed Value is multiplied by to “equalize” the township assessments across a county and so that each county is “equalized” across the state as 33 and 1/3% of the property’s Fair Market Value. The underlying principle is so that all Illinois property is taxed in the same way, or uniformly, as required by the Illinois Constitution. Township Multipliers are based on studies of the value of previous home sales compared to their Fair Market Value as determined by the Assessor. Essentially, because home prices have been generally higher in recent years, you should anticipate a Township Multiplier that makes the taxation of your property greater than the Non-Farm Assessment/Assessed Value.

Equalized Value [Equalized Assessed Value (EAV)] – Taxable value of the property after the Township Multiplier has been applied. (For example, assume a home has a Fair Market Value of $300,000 and strong recent home sales for a Township Multiplier that increases valuations by 5%:

            $300,000 – Fair Market Value

            $100,000 – Non-Farm Assessment (or Assessed Value)

              1.0500 – Township Multiplier

            $105,000 – Equalized Value (or Equalized Assessed Value)

Exemptions – Statutory bases used to reduce or sometimes eliminate property taxes. These are often your first option to achieve fairer property tax treatment. The most common is Illinois’s “General Homestead Exemption,” which acts to reduce the Equalized Assessed Value of your primary residence by $6,000. Other Exemptions available in Illinois include those for:

• senior citizens
• veterans or their surviving spouse
• modifications that make homes more accessible to those with disabilities
• home improvements that increase the assessed value

Levy –Annual amount of money Taxing Districts determine is needed to fund services. (These are adopted by vote of the Taxing Body and collected via property tax bills.)

The Mystery: Knowing the Cast of Actors

You, the Taxpayer – Person or entity listed on the deed as owner of real property. Property owners receive a property assessment card and property tax bill annually. Alternatively, your mortgage lender may receive the property tax bill, but you are still ultimately responsible. (And if you find the assessment card, property tax bill, or township assessment notice initially confusing, you’re not alone.)

Treasurer – A county’s “collector” of taxes. A county’s treasurer generates and sends the tax bills, and payments are made to the Treasurer, The Treasurer does not determine the amount of your property taxes. Rather, the Treasurer calculates the tax bills for all the property in the county based on the Levies passed by Taxing Districts and the valuation of your property by the Assessor.

Taxing District (Taxing Bodies) – Units of government (e.g., cities, villages, counties) as well as parks, libraries, schools, and fire protection districts. Each Taxing District has elected board members who determine the amount of taxes needed to pay for the services provided as well as to support the pensions of those Taxing Districts. These are listed on your tax bill, including the amount of your total tax bill that goes to each Taxing District and the percentage of the tax rate collected by that Taxing District.

Assessor – Generally a countywide position (although some cities and townships have their own Assessor). The Assessor’s Office determines the Assessed Valuations of property, generally assessing approximately one-quarter of the properties in the Assessor’s jurisdiction each year. The Assessor also maintains property assessment records and receives applications for property tax exemptions.

Board of Review – Generally, a board of three members appointed by the county with the authority to review property tax assessments and confirm, revise, or correct those assessments. A hearing before the Board of Review is similar to a courtroom hearing. The Taxpayer may present evidence (e.g., proof of a recent sale, sales of similar property, appraisals by experts) and argue for an adjustment of a property’s Assessed Value. 

Stay Tuned for More …

Next in our series on Illinois Property Taxes: “The Enigma of Illinois Property Tax: Exemptions and Challenges to Valuation.” You’ll discover ways to secure fair taxation of your Illinois property on everything from residential to large and unique properties.