Bill Text: IL HB5439 | 2011-2012 | 97th General Assembly | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Amends the Property Tax Code. Removes language providing that the definition of "homestead property" includes leasehold interests on which a single family residence is situated.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Failed) 2013-01-08 - Session Sine Die [HB5439 Detail]

Download: Illinois-2011-HB5439-Introduced.html

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97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 HB5439 Introduced , by Rep. Michael J. Zalewski SYNOPSIS AS INTRODUCED:
35 ILCS 200/15-175
35 ILCS 200/15-177
Amends the Property Tax Code. Removes language providing that the definition of "homestead property" includes leasehold interests on which a single family residence is situated.
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FISCAL NOTE ACT MAY APPLY HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY
A BILL FOR
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AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Property Tax Code is amended by changing
Sections 15-175 and 15-177 as follows:
(35 ILCS 200/15-175)
Sec. 15-175. General homestead exemption. Except as
provided in Sections 15-176 and 15-177, homestead property is
entitled to an annual homestead exemption limited, except as
described here with relation to cooperatives, to a reduction in
the equalized assessed value of homestead property equal to the
increase in equalized assessed value for the current assessment
year above the equalized assessed value of the property for
1977, up to the maximum reduction set forth below. If however,
the 1977 equalized assessed value upon which taxes were paid is
subsequently determined by local assessing officials, the
Property Tax Appeal Board, or a court to have been excessive,
the equalized assessed value which should have been placed on
the property for 1977 shall be used to determine the amount of
the exemption.
Except as provided in Section 15-176, the maximum reduction
before taxable year 2004 shall be $4,500 in counties with
3,000,000 or more inhabitants and $3,500 in all other counties.

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Except as provided in Sections 15-176 and 15-177, for taxable
years 2004 through 2007, the maximum reduction shall be $5,000,
for taxable year 2008, the maximum reduction is $5,500, and,
for taxable years 2009 and thereafter, the maximum reduction is
$6,000 in all counties. If a county has elected to subject
itself to the provisions of Section 15-176 as provided in
subsection (k) of that Section, then, for the first taxable
year only after the provisions of Section 15-176 no longer
apply, for owners who, for the taxable year, have not been
granted a senior citizens assessment freeze homestead
exemption under Section 15-172 or a long-time occupant
homestead exemption under Section 15-177, there shall be an
additional exemption of $5,000 for owners with a household
income of $30,000 or less.
In counties with fewer than 3,000,000 inhabitants, if,
based on the most recent assessment, the equalized assessed
value of the homestead property for the current assessment year
is greater than the equalized assessed value of the property
for 1977, the owner of the property shall automatically receive
the exemption granted under this Section in an amount equal to
the increase over the 1977 assessment up to the maximum
reduction set forth in this Section.
If in any assessment year beginning with the 2000
assessment year, homestead property has a pro-rata valuation
under Section 9-180 resulting in an increase in the assessed
valuation, a reduction in equalized assessed valuation equal to

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the increase in equalized assessed value of the property for
the year of the pro-rata valuation above the equalized assessed
value of the property for 1977 shall be applied to the property
on a proportionate basis for the period the property qualified
as homestead property during the assessment year. The maximum
proportionate homestead exemption shall not exceed the maximum
homestead exemption allowed in the county under this Section
divided by 365 and multiplied by the number of days the
property qualified as homestead property.
"Homestead property" under this Section includes
residential property that is occupied by its owner or owners as
his or their principal dwelling place, or that is a leasehold
interest on which a single family residence is situated, which
is occupied as a residence by a person who has an ownership
interest therein, legal or equitable or as a lessee, and on
which the person is liable for the payment of property taxes.
For land improved with an apartment building owned and operated
as a cooperative or a building which is a life care facility as
defined in Section 15-170 and considered to be a cooperative
under Section 15-170, the maximum reduction from the equalized
assessed value shall be limited to the increase in the value
above the equalized assessed value of the property for 1977, up
to the maximum reduction set forth above, multiplied by the
number of apartments or units occupied by a person or persons
who is liable, by contract with the owner or owners of record,
for paying property taxes on the property and is an owner of

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record of a legal or equitable interest in the cooperative
apartment building, other than a leasehold interest. For
purposes of this Section, the term "life care facility" has the
meaning stated in Section 15-170.
"Household", as used in this Section, means the owner, the
spouse of the owner, and all persons using the residence of the
owner as their principal place of residence.
"Household income", as used in this Section, means the
combined income of the members of a household for the calendar
year preceding the taxable year.
"Income", as used in this Section, has the same meaning as
provided in Section 3.07 of the Senior Citizens and Disabled
Persons Property Tax Relief and Pharmaceutical Assistance Act,
except that "income" does not include veteran's benefits.
In a cooperative where a homestead exemption has been
granted, the cooperative association or its management firm
shall credit the savings resulting from that exemption only to
the apportioned tax liability of the owner who qualified for
the exemption. Any person who willfully refuses to so credit
the savings shall be guilty of a Class B misdemeanor.
Where married persons maintain and reside in separate
residences qualifying as homestead property, each residence
shall receive 50% of the total reduction in equalized assessed
valuation provided by this Section.
In all counties, the assessor or chief county assessment
officer may determine the eligibility of residential property

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to receive the homestead exemption and the amount of the
exemption by application, visual inspection, questionnaire or
other reasonable methods. The determination shall be made in
accordance with guidelines established by the Department,
provided that the taxpayer applying for an additional general
exemption under this Section shall submit to the chief county
assessment officer an application with an affidavit of the
applicant's total household income, age, marital status (and,
if married, the name and address of the applicant's spouse, if
known), and principal dwelling place of members of the
household on January 1 of the taxable year. The Department
shall issue guidelines establishing a method for verifying the
accuracy of the affidavits filed by applicants under this
paragraph. The applications shall be clearly marked as
applications for the Additional General Homestead Exemption.
In counties with fewer than 3,000,000 inhabitants, in the
event of a sale of homestead property the homestead exemption
shall remain in effect for the remainder of the assessment year
of the sale. The assessor or chief county assessment officer
may require the new owner of the property to apply for the
homestead exemption for the following assessment year.
Notwithstanding Sections 6 and 8 of the State Mandates Act,
no reimbursement by the State is required for the
implementation of any mandate created by this Section.
(Source: P.A. 95-644, eff. 10-12-07.)

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(35 ILCS 200/15-177)
Sec. 15-177. The long-time occupant homestead exemption.
(a) If the county has elected, under Section 15-176, to be
subject to the provisions of the alternative general homestead
exemption, then, for taxable years 2007 and thereafter,
regardless of whether the exemption under Section 15-176
applies, qualified homestead property is entitled to an annual
homestead exemption equal to a reduction in the property's
equalized assessed value calculated as provided in this
Section.
(b) As used in this Section:
"Adjusted homestead value" means the lesser of the
following values:
(1) The property's base homestead value increased by:
(i) 10% for each taxable year after the base year through
and including the current tax year for qualified taxpayers
with a household income of more than $75,000 but not
exceeding $100,000; or (ii) 7% for each taxable year after
the base year through and including the current tax year
for qualified taxpayers with a household income of $75,000
or less. The increase each year is an increase over the
prior year; or
(2) The property's equalized assessed value for the
current tax year minus the general homestead deduction.
"Base homestead value" means:
(1) if the property did not have an adjusted homestead

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value under Section 15-176 for the base year, then an
amount equal to the equalized assessed value of the
property for the base year prior to exemptions, minus the
general homestead deduction, provided that the property's
assessment was not based on a reduced assessed value
resulting from a temporary irregularity in the property for
that year; or
(2) if the property had an adjusted homestead value
under Section 15-176 for the base year, then an amount
equal to the adjusted homestead value of the property under
Section 15-176 for the base year.
"Base year" means the taxable year prior to the taxable
year in which the taxpayer first qualifies for the exemption
under this Section.
"Current taxable year" means the taxable year for which the
exemption under this Section is being applied.
"Equalized assessed value" means the property's assessed
value as equalized by the Department.
"Homestead" or "homestead property" means residential
property that as of January 1 of the tax year is occupied by a
qualified taxpayer as his or her principal dwelling place, or
that is a leasehold interest on which a single family residence
is situated, that is occupied as a residence by a qualified
taxpayer who has a legal or equitable interest therein
evidenced by a written instrument, as an owner or as a lessee,
and on which the person is liable for the payment of property

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taxes. Residential units in an apartment building owned and
operated as a cooperative, or as a life care facility, which
are occupied by persons who hold a legal or equitable interest
in the cooperative apartment building or life care facility as
owners or lessees, and who are liable by contract for the
payment of property taxes, are included within this definition
of homestead property. A homestead includes the dwelling place,
appurtenant structures, and so much of the surrounding land
constituting the parcel on which the dwelling place is situated
as is used for residential purposes. If the assessor has
established a specific legal description for a portion of
property constituting the homestead, then the homestead is
limited to the property within that description.
"Household income" has the meaning set forth under Section
15-172 of this Code.
"General homestead deduction" means the amount of the
general homestead exemption under Section 15-175.
"Life care facility" means a facility defined in Section 2
of the Life Care Facilities Act.
"Qualified homestead property" means homestead property
owned by a qualified taxpayer.
"Qualified taxpayer" means any individual:
(1) who, for at least 10 continuous years as of January
1 of the taxable year, has occupied the same homestead
property as a principal residence and domicile or who, for
at least 5 continuous years as of January 1 of the taxable

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year, has occupied the same homestead property as a
principal residence and domicile if that person received
assistance in the acquisition of the property as part of a
government or nonprofit housing program; and
(2) who has a household income of $100,000 or less.
(c) The base homestead value must remain constant, except
that the assessor may revise it under any of the following
circumstances:
(1) If the equalized assessed value of a homestead
property for the current tax year is less than the previous
base homestead value for that property, then the current
equalized assessed value (provided it is not based on a
reduced assessed value resulting from a temporary
irregularity in the property) becomes the base homestead
value in subsequent tax years.
(2) For any year in which new buildings, structures, or
other improvements are constructed on the homestead
property that would increase its assessed value, the
assessor shall adjust the base homestead value with due
regard to the value added by the new improvements.
(d) The amount of the exemption under this Section is the
greater of: (i) the equalized assessed value of the homestead
property for the current tax year minus the adjusted homestead
value; or (ii) the general homestead deduction.
(e) In the case of an apartment building owned and operated
as a cooperative, or as a life care facility, that contains

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residential units that qualify as homestead property of a
qualified taxpayer under this Section, the maximum cumulative
exemption amount attributed to the entire building or facility
shall not exceed the sum of the exemptions calculated for each
unit that is a qualified homestead property. The cooperative
association, management firm, or other person or entity that
manages or controls the cooperative apartment building or life
care facility shall credit the exemption attributable to each
residential unit only to the apportioned tax liability of the
qualified taxpayer as to that unit. Any person who willfully
refuses to so credit the exemption is guilty of a Class B
misdemeanor.
(f) When married persons maintain separate residences, the
exemption provided under this Section may be claimed by only
one such person and for only one residence. No person who
receives an exemption under Section 15-172 of this Code may
receive an exemption under this Section. No person who receives
an exemption under this Section may receive an exemption under
Section 15-175 or 15-176 of this Code.
(g) In the event of a sale or other transfer in ownership
of the homestead property between spouses or between a parent
and a child, the exemption under this Section remains in effect
if the new owner has a household income of $100,000 or less.
(h) In the event of a sale or other transfer in ownership
of the homestead property other than subsection (g) of this
Section, the exemption under this Section shall remain in

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effect for the remainder of the tax year and be calculated
using the same base homestead value in which the sale or
transfer occurs.
(i) To receive the exemption, a person must submit an
application to the county assessor during the period specified
by the county assessor.
The county assessor shall annually give notice of the
application period by mail or by publication.
The taxpayer must submit, with the application, an
affidavit of the taxpayer's total household income, marital
status (and if married the name and address of the applicant's
spouse, if known), and principal dwelling place of members of
the household on January 1 of the taxable year. The Department
shall establish, by rule, a method for verifying the accuracy
of affidavits filed by applicants under this Section, and the
Chief County Assessment Officer may conduct audits of any
taxpayer claiming an exemption under this Section to verify
that the taxpayer is eligible to receive the exemption. Each
application shall contain or be verified by a written
declaration that it is made under the penalties of perjury. A
taxpayer's signing a fraudulent application under this Act is
perjury, as defined in Section 32-2 of the Criminal Code of
1961. The applications shall be clearly marked as applications
for the Long-time Occupant Homestead Exemption and must contain
a notice that any taxpayer who receives the exemption is
subject to an audit by the Chief County Assessment Officer.

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(j) Notwithstanding Sections 6 and 8 of the State Mandates
Act, no reimbursement by the State is required for the
implementation of any mandate created by this Section.
(Source: P.A. 95-644, eff. 10-12-07.)