Chicago, IL · Member since 2016 · 9 posts · 1 vote
HI All,
I'm just starting out with rental properties and I've noticed a lot of properties that have very high property tax in Illinois and as a result the cash on cash return doesn't work out on a lot of these deals.
It just seems off that these properties are selling for low 100k and the property tax is 5-10k annually.
Any thoughts on this?
Is there an opportunities on these to get the property reassessed and drop this property tax in order to make the cash flow more appealing?
Have you come by this and do you typically just filter these properties out right from the start?
Real Estate Agent · Geneva, IL · Member since 2015 · 403 posts · 172 votes
10y
It can be done! You need to know the drop-dead dates for your county. However, once a property is sold then there is a grace period for the new owner to challenge the taxes. Once you know the dates, follow the instructions and make sure you get all your paperwork in order. Good Luck!
Cincinnati, OH · Member since 2016 · 27 posts · 15 votes
10y
The easiest thing to do would be to appeal the property value to your county auditor using comps or a recent sale price. Many properties in this area have a value around 100k but are distressed and sell for 40k and the auditor will reassess the value and you will only pay taxes on the new 40k value. The worst thing that could happen would be them denying he request but it's worth a shot as it could save a couple thousand a year in taxes.
Cincinnati, OH · Member since 2016 · 27 posts · 15 votes
10y
I think in our county you can only file a complaint from January - April and then they are sorted and processed with hearings throughout the following months. Without having done it myself, I'll defer to more experienced investors to answer that but I would aim for the months category.
Best thing to know is that it can be done and will benefit you as long as you have a valid case for the valuation.
Real Estate Agent · Geneva, IL · Member since 2015 · 403 posts · 172 votes
10y
It can be done! You need to know the drop-dead dates for your county. However, once a property is sold then there is a grace period for the new owner to challenge the taxes. Once you know the dates, follow the instructions and make sure you get all your paperwork in order. Good Luck!
Property Manager · Indianapolis, IN · Member since 2010 · 1k+ posts · 1k+ votes
10y
I get letter from companies that will file everything and take 50% of the first years savings. Might google that and search your area. I was considering it. But was worried they might actually go up.
Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
10y
Consider what a lowered tax bill looks like to a 3rd party - - 'there must be something wrong'. As an owner, I would never create this red flag. During the 2008 market collapse, I had this opportunity and elected to ignore it.