Why are Property Tax Exemptions Lower This Year? It's Complicated
Terry Kelly explains why some homeowners' tax discounts or long-time occupant exemptions are smaller than last year's discounts.
Below is an explanation from Palatine Township Assessor Terry Kelly:
My office has been fielding questions from residents as to why their property tax exemptions are lower this year. As always, with Cook County, the answer is complicated.
So, "why is my tax discount for the homeowner or long time occupant exemption smaller than last year's discount?" In 2004, the legislature implemented a complicated new tax exemption knowin as the 7 percent assessment cap. The basic premise of the program was that the equalized assessed values of owner-occupied homes should not rise by more that 7 percent per year. Any increase above 7 percent was supposed to be tax exempt.
At the time the assessment cap was adopted, assessed values were rising rapidly because of what we now recognize as a "bubble" in the housing market. While the bubble was growing, homeowner and longtime occupant exemptions were also growing. These large exemptions sought to protect homeowners from large tax increases during those years.
But the 7 percent assessment cap was not designed to address the changes in the housing market after the bubble burst. As a result, much of the value of the homeowner and long term occupant exemption that had accumulated since 2005 has been wiped out by declining home values.
All owner-occupied homes in Palatine Township are still eligible for a minimum homeowner exemption discount worth about $517.74, and some will receive exemptions worth more. But for most people, this year's tax discounts due to exemptions are smaller than last year's.
Please call the Township Assessor's Office at 847-358-6164 with any questions.
-Submitted by the Palatine Township Assessor's Office