How Do I Appeal $14,000 Property Taxes?

Question

I'm in California and I just closed on a couple of properties in the Chicago area and the taxes are incredibly high. I knew this going in but both were good deals regardless. The triplex is currently (or in arrears) taxed close to 14,000k per year (155k property value). I was told that it is possible to appeal this amount. Has anyone had experience with this? What's the process? How successful is it? How long does it take? Who would be the one to petition (me as property owner or the turnkey provider that's managing property)?

I'm still cash flowing close to $750 per month on it but even a tax reduction of $1000-1500 per year would be tremendous.

Thank you in advance!

Eugene

I'm still cash flowing close to $750 per month on it but even a tax reduction of $1000-1500 per year would be tremendous.

Thank you in advance!

Eugene

Cody L. · Answer

Not sure how it works in your state but in Texas (and I'd image most places) they just prorate the tax bill based on when you bought it.

For example, I just bought a property that has a $32k tax bill for 2017.  It's due by Jan 31st, 2018.   Since I only just bought the property half way into 2017, I got a credit on my closing for $16k

Sounds like maybe the title company didn't credit taxes to you correctly?

Account Closed · Answer

@Eugene Rogachevsky. I have a law firm that I refer my clients to. They have focused on real estate tax reduction for approximately 30 years. They do residential appeals in cook county only. However, they do commercial appeals in surrounding counties as well. Last year I represented a client who purchased two LaQuinta Inn hotels. I referred that client to this firm and he ultimately received a tax reduction of over $100,000. I would be glad to refer you. Pm me if you need to be put in touch.

Eugene Rogachevsky · Answer

It's not a past due/proration issue. I knew going in that 2015 taxes were in the 13k range. 2016 came in at 14k. They pay taxes in arrears in IL. So the amount wasn't surprised. My original question had to do with the appeals process in IL. I was able to get a couple good lawyer contacts that I'll be reaching out to.

Greg H. · Answer

The 2017 values are out but will not be certified until any and all protests are heard. The property taxes will not be known until the budgets of the tax authorities are approved and the tax rates are set which is usually the first part of October

Cody L. · Answer

Actually 2017 are already listed.  I ran into this as a property I just bought was 2m on the tax roll for 2016 but you could see that 2017 was $2.4m (but being protested).

But anyway, to OP question, I don't think this $14k issue is due to property tax values shooting up after closing.  It's a past due / proration issue.

Greg H. · Answer

True. However the proration will be based on 2016 property taxes as the 2017 property taxes will not be know until around the first part of October.  Typically, we sign a tax proration agreement at closing that allows either party to ask for money or give money if the actual proration is different

Eugene Rogachevsky · Answer

@Cody L.  ya when I buy in CA property taxes are prorated. It turns out that in IL first installment due on March 31,2017 is to cover first half of 2016. So it makes it a little tricky when it comes to the purchase. I don't think they're able to totally quantify what the 2nd installment will be.

I spoke with my lender tho and they will send updated closing docs that will have seller credits in there. Hopefully it'll be rectified. Slated to close in two days.

Brie Schmidt · Answer

@Eugene Rogachevsky - We pay taxes in arrears, so you should have gotten a bill in Feb/March for the first installment of  taxes and another bill is coming for the second installment of.  If you bought the building in  there should be a tax credit given to you on your closing statement.  If you want, M me your PIN and closing statement and I can look into it.

Depending on your area you my be open to appeal your 2017 assessment - and you can appeal previous years in certain circumstances.  Any past due back taxes should be paid by the TK company

How Do I Appeal $14,000 Property Taxes?

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