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2012
Jan 11

Protest Now or Pay More Later

Nearly every type of real property has suffered a double-digit drop in value since 2007.

We cannot assume that taxing authorities have followed that trend in their assessments.  Property owners must be alert to the valuation of their real estate, to assure that the dip in their property values is reflected in their assessments.

A vigilant property owner in Cook County can avoid paying more than a fair share of property taxes by protesting the assessment to the Cook County Assessor and the Cook County Board of Review. With a little work and the right legal advice, a prompt, detailed protest can really pay off.

The time for protest is ripe.  Each year the Cook County Assessor reassesses one-third of the nearly 1.8 million parcels in Cook County.  Starting in January, 2012, the Assessor will reassess all properties located within the boundaries of the City of Chicago with taxes payable in 2013.

This year’s assessment should track the changes in property values, but that does not always happen. According to Moody’s/REAL repeat sales indices, U.S. property values peaked in 2007.  Since the peak, apartment properties have lost 26.3% in value; industrial properties have lost 34.5% in value; office properties have lost 28.4% in value, and retail properties have lost 26.8% in value on a national basis.

Here is a quick overview of the reassessment process.  The Cook County Assessor determines a market value and assessed value (a percentage of market value) of all non-exempt property within Cook County.  After the Assessor has reassessed a township, taxpayers there will get a notice informing them of their new assessments.  Once those notices have been mailed, taxpayers will have just 30 days after the publication date to file a Complaint with the Assessor’s Office.  Owners or taxpayers may represent themselves before the Assessor, if they are confident they have the necessary understanding and evidence to do so.

A valuation Complaint may be based on a number of contentions.  The characteristics of a property might be incorrect; there might be a recent purchase that supports a lower market value; or the taxpayer could get an appraisal which supports a lower market value.  For income-producing property, the income and expenses of the property may support a lower market value.  Vacancy can also significantly affect a property’s market value and assessment.  Once the Complaint and appropriate evidence is filed, the Assessor’s Office will review it and determine if a market value reduction is justified.

If a taxpayer is not satisfied with the results from the Assessor, the taxpayer has a limited time in which to file a Complaint and evidence with the Board.  If the taxpayer wants, the Board will schedule a short oral hearing.  Taxpayers who are individuals may represent themselves before the Board, but taxpayers who are entities, such as corporations or limited liability companies, must be represented by an attorney licensed in Illinois.  The Board will open for complaints for the 2012 assessment year in September, 2012 and will finish all its work by the spring or summer of 2013.

It is important for all property owners to review promptly their Notices of Reassessment and notify their real estate tax attorneys of the reassessment to determine if a reduction is possible.  Once a taxpayer receives the tax bill, it is too late to appeal.

Typically, real estate tax attorneys only charge a contingent fee for this service, plus expenses such as the cost of an appraisal.  If the Assessor and Board decline to reduce the assessed value, the taxpayer owes no attorneys’ fees for the matter.

The ethical rules of some states require us to identify this as attorney advertising material.

The choice of an attorney is an important decision and should not be based solely upon advertisements.

This blog is intended for information only and should not be considered legal advice. If you desire legal advice for a particular situation you should consult an attorney. If you chose to contact the author of this blog, no attorney-client relationship is being formed and the author does not have a duty to maintain as confidential any information submitted.

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