Rising property taxes are increasingly of concern to Chicago homeowners, with yet another significant hike having occurred in 2016. This year, a homeowner with property valued at $225,000 can expect to pay $3,633, or $413 more than last year. Thankfully, relief appears to be on the way, as City Counsel recently passed a property tax rebate plan spearheaded by Mayor Rahm Emanuel. The rebate is only a one-time phenomenon, which means the city will need to find new sources of money in order to reduce local homeowners’ property tax levels in 2017. For now, however, the rebate is much appreciated by those suffering under the burden of high property tax payments.
Rebate levels will vary significantly from one homeowner to the next, with low-income Chicago residents benefiting most from the new plan. Low-income individuals who suffered significant property tax increases due to the recent $318 million property tax hike are eligible for up to $200 in tax rebates. From there, rebate amounts decrease steadily as household income rises. Some senior homeowners will be eligible for additional rebates of up to $150. Other homeowners will be allowed to apply for hardship money.
When to Apply
Details regarding rebate applications are not yet available, but Finance Director Alex Holt has promised a sixty-day window for application later this year. Ideally, rebate checks will be sent out by the end of 2016. Currently, the refund process for Cook County involves completing an application form and providing proof of payment, such as a copy of a canceled check or a copy of a bank account statement show the account holder’s name and tax payment.
No Rebates for Renters
Many Chicago homeowners are all in favor of the latest tax rebate, but renters feel shut out by a plan that only caters to those who own property. Rising rent prices are just as big of a problem in Chicago, where the median rent for a one-bedroom apartment was a whopping $1,670 in early 2015. According to the Emanuel administration, demands to incorporate renters into the rebate have been rejected because they would be too complicated and costly to implement.
The Future of Property Taxes in Chicago
Although the recently passed property tax refund will deliver much-needed financial relief to struggling Chicago homeowners, it is just a temporary measure. In the next few years, property taxes will likely continue to rise as efforts to better fund pensions for firefighters, law enforcement officials, and municipal employees are enacted. Civic Federation President Laurence Msall tells the Chicago Tribune that the region’s pensions have historically been underfunded, and unfortunately, the burden is about to fall on Illinois homeowners. However, local politicians promise to make every effort to secure future refunds and additional forms of relief in 2017 and beyond.
If you need help figuring out if you are eligible for a tax rebate, or have any other questions regarding property taxes in Chicago, contact the Ansari Tax Law Firm.