New Law Increases Senior Homestead Exemption, General Homestead Exemption
CHICAGO – April 23, 2013 – (RealEstateRama) — Governor Pat Quinn today signed legislation that will reduce property tax bills for seniors across Illinois. Senate Bill 1894 raises the senior homestead exemption from $4,000 to $5,000 – potentially saving seniors up to more than $200 annually. This new exemption for seniors takes effect for Cook County this year.
“The new law will reduce property tax bills for seniors across Illinois,” Governor Quinn said. “This boost in savings will relieve some of the financial burden faced by seniors and working families, and help ensure no one struggles to stay in their home.”
Sponsored by Senator Toi Hutchinson (D-Olympia Fields) and Representative John Bradley (D-Marion), SB 1894 increases the Senior Homestead Exemption – property tax breaks for Illinois residents age 65 and older – from $4,000 to $5,000. Seniors in the city of Chicago will have the increase applied to their taxable year 2012 taxes, due in 2013. All other counties will benefit from the increase beginning next year.
In addition, this bill raises the general homestead exemption for Cook County starting next year. Originally phased-in over three years, Cook County’s Alternative General Homestead Exemption was designed to limit yearly increases and assessments on residential property. Cook County currently has a seven percent exemption cap, while the rest of the state maintains a flat exemption rate of $6,000. The new law moves Cook County to a flat exemption rate of $7,000 beginning taxable year 2012.
City of Chicago homeowners will be the first to benefit from the increased exemption as the seven percent cap expires in the city this year. Chicago’s maximum reduction under the cap would have decreased from $8,000 to $6,000, but SB 1894 bumps up the maximum to $7,000. Northern Cook County will begin benefitting from the increase in 2014 when the cap expires in that region, and Southern Cook County will begin benefitting in 2015.
“Property owners throughout Cook County have seen their taxes increase year after year,” Sen. Hutchinson said. “This will go a long way for many families who continue to struggle to make ends meet.”
“This is good public policy that will help take some of the sting away as the 7 percent provision expires,” Assessor Berrios said. “Due to the quick action of the state legislature and the governor, the additional exemption savings will be seen on second-installment bills Cook County homeowners will receive this summer.”
The law is effective immediately.