You just got a notification from TaxProper that your appeal was successful — congratulations! Now how does that reduction translate into you saving money?
In short, your savings are reflected on next year's 2nd installment tax bill, and then lasts up to three years until the next full re-assessment.
Unfortunately the journey from a successful property tax appeal to seeing savings in your pocket can be difficult to understand, because the way your property tax bill is calculated is very opaque and confusing.
The easiest way to explain this concept is with an example. Your property tax bill is based on your assessment, a state equalization factor, the local tax rate, and any exemptions you qualify for.
Tax = (Assessment *10% * State Equalization Factor - Exemptions) * Tax Rate
The State Equalization Factor and Tax Rate can change slightly year over year, but let’s assume they stay the same to keep things simple. The state equalization factor is usually around 3, and the typical tax rate is about 10%. For a homeowners exemption, you insert $10,000 into the formula.
Let’s say your 2019 Assessment was $300,000, and you claim the homeowner’s exemption. Your total 2019 tax bill would be:
2019 Tax Bill = 10%* ($300,000 *10% * 3 - $10,000)
2019 Tax Bill = $8,000
In this example, the assessor’s office sends your 2020 assessment notice and proposes that your assessment remain the same for 2020 at $300,000, and you have 30 days to appeal. If you don’t appeal, and the tax rate & equalizer stay the same, your total 2020 tax bill will remain the same as well. Remember, the tax bill comes in 2 installments, the 1st Installment being due in March of the following year, and the 2nd installment being due in August of the following year.
It’s important to note that by law, the 1st tax installment for 2020 is simply 55% of what your total 2019 tax bill was. Then, the 2nd installment reflects any remaining balance due after considering new assessments, tax rates, and exemptions. That means that any savings that TaxProper gets you will be reflected on the 2nd installment tax bill that you pay the following year.
Here’s how that timeline plays out in this example:
What would happen instead if you had a successful appeal filed in 2020? Let’s say TaxProper’s appeal reduces the proposed 2020 assessment from $300,000 to $250,000.
The 2020 tax bill would then be $6,500. The 1st installment would still simply be 55% of the 2019 bill, and then the $1,500 savings would be reflected with a lower 2nd installment tax bill.
Here’s how that pans out:
In comparing both scenarios, you can see that the 2020 1st installment bill will be the same regardless of if you appeal or not. The $1,500 savings are realized on the 2nd installment bill that is usually due on August 1st of the following year.Property Taxes Cook County
The Cook County Assessor's office has just published the by-township property tax appeal deadlines for 2020.
Please note, these value are subject to change (and often do).Property Taxes Cook County Property Tax Laws
Property taxes are the second biggest expense owners of real estate face, after mortgage servicing. Fortunately, property owners have the ability to reduce this cost by appealing their property tax bill. This article explains how in four steps.
1. Check if you are overassessed
Your property assessment is the key factor that determines how much you pay in property taxes, because that is the value the property tax rate is applied to. The lower your assessment, the lower your property tax bill.
There are two easy ways to determine if you are overassessed. The first requires you to look at how much properties similar to yours are assessed. If a property that is identical to yours is assessed at a lower amount than yours, it's a good indicator you are over assessed. The second requires you to look at how much similar properties to yours were sold for. If the true market price is lower than the assessment, your property could be overvalued by the assessor.
2. Get the information you need to appeal
If you are confident your property is overassessed, you need to collect some additional information that is specific to your property. First, you need to figure out which of the 38 townships in Cook County your property is in. Once this is determined, check on the Cook County website when your township's appeal period opens. This information will let you know what the deadline is for submitting your appeal.
3. Determine what type of appeal to submit.
There are three types of appeals you can submit: comparable sales, lack of uniformity or economic value.
Comparable sales requires you to submit evidence that similar properties have been sold for less than your assessment.
Lack of uniformity requires you to submit evidence that similar properties are being assessed differently.
Economic value requires you to submit three years of income and expense information, but this type of appeal only applies to income producing properties.
4. Submit and wait
After you have gathered your evidence, submit it to the Cook County Assessor's Office. It's critical that you review all of the applicable appeal rules prior to submission, because failure to comply can result in an appeal denial.
Depending on the appeal backlog, it can take several weeks or months for the Assessor's Office to provide you with a decision.