“Property Tax Appeals” – KSN attorney Timothy Jacobs reviews the property tax appeal process for community associations and commercial properties in the Chicagoland area. Tim also discusses what community associations and commercial properties can expect to see during the 2021 appeal season due to the Coronavirus pandemic. (11 mins.)
The KSN Podcast examines various aspects of association law, landlord/tenant issues, property tax appeals, and more. In each episode, KSN attorneys share their experience and knowledge as they discuss legal updates, best practices, industry trends, and more. KSN Podcast episodes are available at www.ksnlaw.com/podcast.
Since 1983, KSN has been a legal resource for condominium, homeowner, and townhome associations. Additionally, we represent clients in real estate transactions, collections, landlord/tenant issues, and property tax appeals. We represent thousands of clients and community associations throughout the US with offices in several states including Florida, Illinois, Indiana, and Wisconsin.
For more info about our law firm and legal services, please visit www.ksnlaw.com
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Since 1983, KSN has been a legal resource for condominium, homeowner, and townhome associations. Additionally, we represent clients in real estate transactions, collections, landlord/tenant issues, and property tax appeals. We represent thousands of clients and community associations throughout the US with offices in several states including Florida, Illinois, Indiana, and Wisconsin.
For more info about our law firm and legal services, please visit www.ksnlaw.com.
Episode Transcription
Nikki: You’re listening to the KSN podcast and today we’re talking about property tax appeals. Welcome to the KSN podcast where you’ll hear from KSN attorneys as they share their experience and insight on legal issues surrounding community associations, collections, property tax appeals, and landlord tenant laws. I’m Nikki and today we’re joined by KSN attorney, Timothy Jacobs. Tim concentrates his practice in property tax assessment appeals, and represents Illinois property owners in downtown Chicago and the surrounding suburbs. Tim has over 15 years of experience and has secured over a hundred million dollars in tax savings for his clients. It’s great to have you on the podcast today. Welcome, Tim.
Timothy: Hi Nikki. It’s great to be here.
Nikki: Our topic today will be about property tax appeals in the Chicago land area and how community associations along with commercial properties can combat the increase in property taxes that was approved by the Chicago city’s council in late 2019.
Timothy: Due to the impact of the COVID 19 pandemic, there are massive declines in state sale tax, amusement tax and other local tax revenues. In order to restore operating budgets, local governments are going to be looking to property taxes to close those gaps and Illinois is no exception. Being an Illinois property owner, we already pay the second highest property taxes in the United States and this year alone property tax payers in Chicago are going to bear an additional a hundred-million-dollar burden.
Nikki: Wow. That’s a pretty big number. So, Tim, if you’re saying that my property taxes are likely to increase yet again this year, how is the assessor’s office determining that increase on my property?
Timothy: Luckily, the assessor’s not determining any increase, rather that’s taxing districts, namely schools, parks, libraries, police, and fire and other units of local governments. When they set their budgets, those budgets go up and so do our taxes. However, the assessor does play a role in how that tax increase is distributed to taxpayers. Property taxes are determined on an [Inaudible: 02:03] basis, meaning that the cost of the tax bill is based on a large part of each property’s value. It’s an assessor’s job to estimate the value of every property for property tax purposes. In fact, the Cook County assessor’s office is responsible for placing a value of about 1.8 million parcels of property in the county itself. So, in that process, mistakes can be made. Cook County is actually divided into three districts; the Northern suburbs, the Southern suburbs and the city of Chicago. The Northern suburbs and Southern suburbs are obviously outside the city and divided by north avenue and these districts get reassessed on a triennial schedule or once every three years. 2021 happens to be the reassessment year for Chicago. So, property owners in the city, which is composed of the townships of Hyde Park, Jefferson Lake, Lakeview, North Chicago, Rogers Park, West Chicago and South Chicago will get reassessed or revalued for tax purposes this year.
Nikki: All right, Tim. So, if I live in one of those townships that you just named, what does my association need to do in regards to appealing our property taxes, to make sure that we’re not overpaying? Especially since we know that the local governments are trying to make up for the lost revenues this past year that they’ve had and close those gaps by adding that back into our property tax bills.
Timothy: Well, first off, when you file an appeal, Nikki, you’re not actually challenging the tax bill itself. You’re contesting the value of your unit, your house, your building as determined by the county assessor. If the assessor overvalued a unit in an association during its reassessment, the only viable approach to protect against the excessive tax increase is an assessment appeal. Assessment appeals, if successful, reduce projected tax bills, meaning bills that are coming in the future by lowering the assessment upon which they are based. Therefore, associations should be seeking legal counsel concerning filing an appeal this year.
Nikki: Tim and I are going to take a quick break, but when we get back, we’ll continue discussing property tax appeals.
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Nikki: And we’re back. I’m here with attorney Timothy Jacobs and we’re discussing property tax appeals. So, Tim, we left off discussing how property tax appeals work for Chicago community associations. Besides the obvious reason for paying that reduced property tax bill, are there any other benefits that community associations can see as to why they should file a group appeal?
Timothy: Well, first and foremost, the assessor prefers one appeal over dozens or even hundreds of appeals filed by the owner separately. As you can imagine, it’s administratively easy to process one appeal as opposed to many and that is the favorite method. Secondly, the assessor actually places a single value on the entire building or development when it comes to condominium associations and reviewing that value is facilitated by one appeal, inclusive of all units. Again, it’s opposed to many divergent appeals. Third, the assessor has a duty to uniformly assess all units with an association. The group appeal enables the assessor to meet this allocation and a non-appeal perspective just from the Association’s perspective, appeals can keep taxes on the units as low as possible and therefore help maintain, improve unit values. Think of this as any maintenance project like replacing windows, roofs, balconies. Boards spend countless hours and meetings on these other matters. Taxes should be no different.
Nikki: Yeah. I mean, I definitely can’t argue with you. We’re spending all of our time trying to decide on how we want to spend our association budgets and whatnot and if we can save our money with our tax appeals. There should be no reason as to why we shouldn’t spend time deciding on how to take that manner. So, do community associations need to hire an attorney like yourself to file an appeal?
Timothy: To file a group appeal, yes, associations are not considered persons under Illinois law and thus need a licensed attorney to represent them in any legal proceeding. This includes property tax assessment appeals. Further, the board review, the property tax appeal board or the circuit court, I should say and the circuit court require associations to be represented by licensed attorneys in assessment appeals filed before their respective offices.
Nikki: So, then Tim, what is the difference between a tax attorney and a tax consultant?
Timothy: Well, unfortunately hiring a tax consultant or having one of the board members file an appeal on behalf of the entire association could result in the appeal being voided and might cause the association the ability to refile with legal counsel if the deadline is expired. The filing rules of the board review and other agencies, as I mentioned before, require associations to file with licensed attorneys. Moreover condominium, homeowner, and townhome community associations need skilled legal counsel to steer them through the property tax appeal process, regardless of the rules. Not only do association assessment appeals require careful analysis and preparation, but there are several agencies and levels in which to appeal. Each one comes with its own caveats and pitfalls.
Nikki: So, Tim, let’s go ahead and shift gears here for the last few minutes and talk about commercial properties. I think it goes without saying that this pandemic has gone on far longer than any of us could have ever anticipated when it became so apparent back in March of 2020 and commercial properties have been hit pretty hard over this past year because of it. We talked earlier about local governments trying to restore operating budgets through property taxes, but can commercial properties expect to see that same increase as well?
Timothy: That depends. The assessor indicated earlier in the year that it was very willing to give relief to certain commercial property types due to the pandemic, most notably you think of hotels or restaurants, which realized significant declines in property values as a result of the pandemic. Other property types like supermarkets or warehouses have performed fairly well. So, they’re likely not entitled to relief. Many commercial property owners were wise to seek legal counsel and secure property tax relief in appeals. For example, KSN convinced the assessor office to lower the assessment of one of its motel clients by 24%. We also persuaded the assessor to lower the assessment of a commercial storefront located on the Southwest side of Chicago by 19%. This particular client had tremendous difficulty finding a tenant for one of its vacant units with COVID and all the restrictions going on and we would convince the assessor to lower that assessment accordingly. These reductions are going to aid our clients in weathering this tough financial storm, but unfortunately too many commercial owners sat on their hands and did not appeal and they are the ones at risk of realizing property tax increases as a result.
Nikki: It’s incredible that you guys decreased the percent, 24% for one of your motel clients. I’m sure that had to feel pretty good here with so many people struggling financially this last year. So, I mean, what kind of recommendations would you have for community associations who are looking to file a group appeal or any of those other commercial property owners that you said may have missed that first mark? We’re trying to keep their heads above waters, what kind of advice can you give our listeners today?
Timothy: Just to say directly, seek legal counsel. The only viable way to protect yourself against an excessive tax increase is through a well-argued appeal. If you’re an association, as I mentioned in order to even file a group appeal, it’s necessary to hire an attorney to do this due to filing rules, but to be candid, even without these rules, it’s still a viable to have an attorney handled the appeal since he or she would likely secure the relief to which the Association’s entitled. They’re familiar with the kind of arguments that carry the weight with the county and the ones that don’t. For commercial owners, appeals on these properties can be quite complex. There are many hotels and restaurants that did not get the relief to which they’re entitled this year, either because they did not file or failed to provide the assessor with the information it needed to provide such relief. Additionally, whether you’re in a condominium association or own a commercial property, filing deadlines need to be monitored. An attorney’s job is to watch these deadlines and ensure that they are met and as one mentor taught me many years ago, if you miss a deadline by a day, you missed it by a year. Taking on this responsibility is fraught with risk. My recommendation is to partner with sound legal counsel so that you can rest assured your property taxes are no higher than they should be.
Nikki: That was KSN attorney Timothy Jacobs. Tim concentrates in property tax appeals and representing Illinois properties in downtown Chicago and the surrounding suburbs. KSN is an experienced legal resource, ready to provide you with quality advice and exceptional service. We look forward to demonstrating how we have earned the trust of thousands of clients over the past 35 years. If you’d like to reach Tim or anyone of KSN’s experience attorneys, please call 855-537-0500. You can also visit ksnlaw.com and complete the contact form to send us a message. Thanks for listening.
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Please note the material contained on the KSN Podcast is for informational purposes only and does not constitute legal advice. No attorney-client relationship is established by your review or receipt of the information contained on the KSN Podcast. You should not act on the information discussed on the KSN Podcast without first obtaining legal advice from an attorney duly licensed to practice law in your State. While KSN has made every effort to include up-to-date information on The KSN podcast, the law can change quickly. Accordingly, please understand that information discussed on the podcast may not yet reflect the most recent legal developments. Material is not guaranteed to be correct, complete, or up to date. KSN reserves the right to revise or update the information and statements of law discussed on the podcast at any time, without notice, and disclaims any liability for your use of information or statements of law discussed on the podcast, or the performance of the podcast generally. The KSN Podcast may be considered advertising in some jurisdictions under applicable law/s and/or ethical rules/regulations. © 2021 Kovitz Shifrin Nesbit, A Professional Corporation.