Lauren Elliott & Melissa Whitley wrote this article that was published in the Tax Trends newsletter of the Illinois Start Bar Association’s Section on State & Local Taxation. Click here to read the article.
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Lauren Elliott & Melissa Whitley wrote this article that was published in the Tax Trends newsletter of the Illinois Start Bar Association’s Section on State & Local Taxation. Click here to read the article. When Will You Receive Your 2022 Re-assessment Notice?March 28, 2022 Property in the northern suburbs of Cook County will be re-assessed in 2022. Assessment notices are mailed one township at a time, typically from February through September. But this year, they will be mailed late – very late. Why? The Assessor implemented a new computer system in 2021 that had many problems. It was poorly planned and implemented and prevented the Assessor from completing his work on time. It will also cause huge delays to other government agencies that need to complete their work before tax bills are issued. Under normal circumstances, the Assessor starts his work in February, completes it by November and delivers a steady stream of work to the Board of Review during the year so it can hear tax appeal cases. The Assessor usually completes all of his work by November. But this year, he completed no work by November; current projections have him finishing up in April, about 5 months later than normal. That will delay the Board of Review. Normally, the Board starts hearing tax appeals in August, but the Assessor’s delays prevented the Board from hearing tax appeals until January. The bulk of its work will be delayed until this summer. So, while the Board normally completes its work by May, this year it may not be done until the end of 2022. How will this impact tax bills? Tax bills will be substantially delayed – perhaps up to six months. Tax bills are usually mailed in June. But this year they may not be mailed until December or January and may collide with the 2023 first installment tax bills that will come out around the same time. That will cause major confusion. But on the positive side, you will have more time to pay your 2021 second installment taxes. When will you receive your 2022 assessment notice? We’re not sure. If the Assessor completes his 2021 work by April, he may start sending 2022 assessment notices shortly after that (May?). That would move things along but cause confusion because the Board will still be hearing 2021 tax appeals when the Assessor releases its 2022 assessments. Alternatively, the Assessor could wait to start the 2022 re-assessment until he and the Board of Review complete their work for 2021. If that happens (probably unlikely), the first 2022 assessment notices may not be mailed until the end of this year – 8 to 10 months late. That will delay next year’s tax bills. We will notify you once we have a better idea of when 2022 north suburban assessment notices will be mailed.
Cook County Assessor Fritz Kaegi was elected in 2018 with a mandate to reform the Cook County Assessor’s office. He implemented several big measures, including a 2021 computer system upgrade that stalled operations in his office as well as new and controversial valuation methods that have caused commercial assessments to increase significantly more than residential assessments. Crain’s Chicago Business recently interviewed Cook County Board of Review Commissioner Larry Rogers to learn his thoughts on these issues. He said: “This has been the worst assessment cycle I’ve seen of any assessor that I have served with as an elected official in my almost two decades. The implementation and execution have been horrid.” A problematic computer upgrade In 2021, the Assessor replaced a decades-old mainframe computer that integrated with other government agencies (the Board of Review, the Cook County Clerk and the Treasurer) who work together to issue real estate tax bills. While the system was old, it worked and was reliable. The new system has been fraught with problems. 2021 Chicago property assessments were released late. Data errors were common, and assessments had to be corrected and re-published multiple times. Important data appears to be missing from the Assessor’s public-facing records. And, the Assessor’s office has been unable to publish results of tax appeals filed to their office on a timely basis. All of this has caused substantial delays in the completion of the Assessor’s 2021 appeal work. And, since the Assessor is the first step in the process, downstream governmental agencies (the Board of Review, the County Clerk and the Treasurer) are unable to complete their work on a timely basis. This will cause substantial delays in mailing 2021 second installment tax bills. Major delays Normally, the Assessor completes his work (publishing assessments and correcting them following tax appeals) by December of each year. As of March 2022, the Assessor has only completed 25% of its work and, according to Rogers, “I don’t know when we are going to get the remainder.” How will this affect property owners? • Tax appeal decisions are late. Decisions on tax appeals filed to the Assessor for most Chicago properties are months late and we have no idea when they will be issued. What about Board of Review tax appeals? Many taxpayers (especially commercial taxpayers) file tax appeals to the Board of Review seeking assessment reductions. It has been widely publicized that the Board has been reducing assessments substantially. The Assessor, on the other hand, has steadfastly claimed his assessments are accurate and the Board of Review has wrongly reduced them so much and so often. What does Rogers have to say about this?
We expect that the Board will take its time to give taxpayers thoughtful consideration in tax appeals, despite the current assessment delays. The final word “The Assessor should have run the new system in parallel with the old system to vet and test the new system. Totally avoidable, if you ask me.” – Larry Rogers, Crain’s podcast. If you are a Crain’s subscriber and want to listen to the Crain’s podcast, click here. The Chicago Sun-Times recently published an investigative report claiming Cook County Assessor Fritz Kaegi cut 2020 assessments for nearly all Cook County homes based on a “wild miscalculation” that pandemic-induced job cuts would cause home values to plummet. Home prices skyrocketed, however, and it appears the Assessor jumped the gun. According to Civic Federation president, Laurence Msall, “They [the Assessor’s office] took a gamble, and the gamble didn’t turn out as they expected.” How did this impact taxpayers? Winners and losers The Assessor’s actions did not reduce government spending. Taxing bodies still needed the same money to operate, but the Assessor’s COVID adjustments did impact tax bills. Since property taxation is a zero-sum game, many taxpayers ended up paying more (often, much more) so others could pay less (mostly a little less). And, the pain suffered by the losers was much worse than the gain enjoyed by the winners. Who paid more? It’s fair to say that everyone in Cook County paid 10.54% more because of the Assessor’s COVID tax relief. Why? These huge reductions in the assessment base caused the Cook County equalizer to spike 10.54% and that caused 10.54% upward pressure on every 2020 Cook County tax bill. But, many homeowners experienced offsetting tax savings (10% or so) because of the Assessor’s COVID assessment reductions. In the end, however, many homeowners paid higher taxes as the 10.54% increase in the equalizer was greater than the 10% (+/-) savings they experienced from their assessment reductions. The Sun-Times and Cook County Treasurer Maria Pappas report that “50% of the county’s homeowners ended up with bigger tax bills, and 78% of the commercial property owners ended up with bigger bills to cover the COVID discounts homeowners got.” So, there was much pain for many because of a “miscalculation” that proved wrong. And, according to the Civic Federation, “A lot of the relief they gave was uneven and not where it was needed.” At the end of the day, this ended up being a shell game that confused everyone. Our Thoughts The Assessor’s job is to value real estate based on market data. He is not supposed to speculate what property might be worth in the future, but to value property based on actual data and events that occurred before the valuation date (January 1st of the tax year). It’s NOT the Assessor’s job to speculate on future property values, nor to make tax policy (to determine who should pay more or less). That’s the job of the legislature. The Assessor’s job is to value properties based on hard data. It’s clear the Assessor had no solid data on how COVID impacted property values when he made his COVID adjustments at the beginning of the pandemic. In fact, his former data chief, Robert Ross, admitted, “We guessed it wrong” (quoted in the Sun-Times). That being the case, if any taxpayer believed COVID impacted the value of his or her property, that issue should have been raised by the taxpayer in a tax appeal supported by appropriate evidence. That’s how the law is supposed to work. And that would have resulted in a fair outcome for all taxpayers. What can you do? The property tax world today is ever-changing. Old approaches to contesting assessments don’t work as well today. To get the lowest tax bill possible, you must keep your ear to the ground and adapt your tactics and strategies to work in the current environment. Today, there is no substitute for good lawyering and sage valuation knowledge. To read the Sun Times article, click here. How you can help us lower your taxesAugust 31, 2021 Chicago is being reassessed this year. Assessment increases for commercial taxpayers have gone through the roof. The Assessor started four months late but he wants to finish on time – in December. That means he will decide a record number of tax appeals in about half of the normal amount of time! Also, the assessing officials are becoming tougher. They now require more and better documentation to even consider lowering your assessment. The bar for successful appeals has been raised. But there is good news: You can get good relief in this environment. But we need your help to do so. Here’s what you can do to make it easier for us to get the best results for you.
The bottom line: Get your documents to us fast Please help us to help you by giving us all the documents we request within 7 days. Our staff thanks you!! Big property tax shift to commercial properties. Why it’s happening and what you can do about itAugust 4, 2021 You may have heard that property taxes on commercial properties in Cook County are on the rise. But you may not know why this is happening or what you can do about it. Real Estate Tax Incentives to Attract and Retain Businesses in Cook County: A Discussion with the all the ExpertsFebruary 8, 2021 Joanne Elliott is moderating a panel discussion on Real Estate Tax Incentives in #CookCounty. Too often, the opportunity to secure an #incentive is missed due to lack of knowledge. Don’t miss your (or your client’s) opportunity to secure 60% tax savings, click here. Panelists include: Brian Liston, Melissa Whitley, Lauren Elliott, Cook County Assessor’s Office – Tatia Gibbons, Ira Horwitz and Dominick Spalla, Cook County Bureau of Economic Development – Sheryl Stewart-Caldwell, South Holland – John Watson, Jr., Village of Schaumburg – Matt Frank, and Brown Commercial Group – Trinity Scurto. We hope you can join us! Property taxes and Financial DefenseJanuary 20, 2021 Thank you to IREM for allowing us to our partner, Michael Elliott, speak on the latest challenges and trends for commercial property owners and managers as it relates to property taxes.
Understanding the complicated property tax laws and preparing a strategic appeals plan are two factors needed by commercial property owners and managers to successfully appeal tax assessments in Cook County. Earlier today, Michael J. Elliott, founding partner of the Elliott & Associates Attorneys, P.C., shared that advice during an informative webinar, “Financial Self Defense,” hosted by IREM Chicago. More than 25 members, Industry Partners and guests participated in the webinar. Mr. Elliott shared a wide range of insight and information, including thoughts on a Chicago Tribune and Pro Publica investigative report called “The Tax Divide,” appeals practices through the office of current Cook County Assessor Fritz Kaegi, the impact of the COVID-19 pandemic, property appraisals, and relevant upcoming legislation in Springfield. He also cited seven ways to win a tax appeal – with one factor being patience. Request for Reissuance of Refund Check FormDecember 4, 2020 You may receive a notice from the Assessor stating that your assessment is being reduced due to COVID but that may not mean a reduction in your tax bill. Why? Read the full Crain’s article here. UPDATED 11/19/2020 – If you are not a Crain’s member, Alby Gallun, the author of the article, also was interviewed in a podcast. You can click here to listen. |
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