Should You Appeal Property Tax Assessments on Your Chicago Investment Property?

Owning investment property in Chicago can be a lucrative and successful business for a lot of landlords, but one common issue here that many investors dread is property tax assessments and tax hikes. In Chicago, tax hikes are can be compared to whether it will still snow in April every year—it’s going to happen, the question is how much?
One thing you probably know is that appealing those assessments is possible, and many people choose to do so to save themselves money every year. After all, your property taxes are determined by the city’s tax rate and the appraised value of your property. In tougher market years, that appraised value might not be all that accurate, which can lead to discrepancies and unfair property tax assessments. Appealing the property tax bills you get can be done, but it’s important to know when to do so and how to do it. As a Chicago property management company, we’re more than familiar with the intricacies of appealing property tax assessments, and if you need help, we’re more than prepared to lend a hand.

What to Know About Appealing Your Property Tax

First and foremost, it should be pointed out that you won’t actually be appealing the tax rate. Rather, you’ll be appealing what the city has decided is the value of your property. Many homeowners and investors have found that when the value of their property is given, it’s not accurate in accordance with the current market, and therefore should be appealed.

These problems arise because the valuations of properties are only taken every three years in Chicago. That can lead to great discrepancies between the reported value and the actual value, particularly in years where the economy and the housing market are in a slump. Your home may be reported as being worth a lot, but, for instance, during the housing crisis several years ago, many homeowners found they owed more on their mortgages than their homes were worth. For this reason, it’s important to keep up to date on what your home or Chicago investment property is worth so that when you do receive the assessments, you’ll be able to tell if it’s accurate and reasonable or not.


Who Do You Appeal To?

Depending on how determined you are to adjust your property tax bill, there are five different levels you can take your issue to.

First, you can bring the issue to the Cook County Assessor’s office. If they don’t allow an appeal, you can ask for a re-review (your second chance). The third option is to file an appeal with the Cook County Board of Review, and fourth is to the Cook County Circuit Court. Finally, if the issue still hasn’t been settled, you can appeal to the Illinois Property Tax Appeal Board. Some landlords suspect that the first step or two may result in a “no” answer for the appeal simply to discourage those who are less tenacious in their fight.

When to Appeal Your Property Tax Assessment

Since Chicago is known for its complicated processes with all things administrative (let’s not talk about the city sticker process, okay?), it stands to reason that the property tax appeals process is a bit complicated. Each year, there are different windows for “townships” to appeal their taxes. Townships refers to parts of the city, and you find out which township you’re in by looking at your property tax bill. Your township name may not be the same name as the area your property is in—like we said, Chicago can be confusing.
Generally speaking, you have about a one-month window from the time you receive your assessment to the time you can file the initial appea. About a month after that is the final deadline for requesting a re-review. However, these time frames can vary depending on when you initially submitted your appeal.


How to Know Whether You Should Appeal for Your Chicago Investment Properties

When you appeal, the county will be looking for a valid argument about why your property taxes should be adjusted. These arguments include, but are not limited to:

  • A discrepancy between the suggested value of your property versus the suggested value of the other properties in the area. In other words, if your property is valued much higher than the similar surrounding properties, your tax bill may be unnecessarily higher than it should be. These discrepancies are one of the most common reasons people appeal their taxes.
  • Overvaluation: this means that your argument is that whatever the assessed value of your property, it’s not in line with the current market value. This is a tougher argument to prove than others, but many people still fight this way.
  • Incorrect information leading to improper tax valuation. For example, the county is incorrect in what they’ve assessed your property to be, such as the property being listed as larger than it is, damage that affects value being unlisted from the property’s records, etc.

One tough reason people appeal to is the condition of the home. If your Chicago investment property needs a lot of work done to it, yet is being valued at the same price that a similar-sized property in much better condition, you may have a hard time appealing, simply due to the county’s lack of concern about these factors—don’t you wish we had a better reason for this other than “they don’t really care?” Us too.

Getting Help with Appealing Your Property Tax Assessment

Appealing your property tax assessment can offer benefits such as no longer needing to raise your tenants’ rent as much as you thought you would, as well as simply saving yourself the money. If you’re interested in learning more about the appeals process, Lofty can help. We’re a property management company in Chicago, and our number one goal is to make owning investment properties in Chicago easier and more enjoyable. Let us give you a hand with the tedious work surrounding tax appeals (as well as any other tasks you may need help with), so that you can get back to living the life you deserve.

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