103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB2814

 

Introduced 1/17/2024, by Sen. Patrick J. Joyce

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 200/9-265

    Amends the Property Tax Code. In counties with fewer than 3,000,000 inhabitants, provides that property that receives an erroneous homestead exemption for the current assessment year or for any of the 3 prior assessment years may be considered omitted property. Provides for penalties and interest to be imposed on that omitted property. Provides that any arrearage of taxes or interest that might have been assessed against that omitted property shall not be chargeable to certain bona fide purchasers of the property. Effective immediately.


LRB103 35597 HLH 65670 b

 

 

A BILL FOR

 

SB2814LRB103 35597 HLH 65670 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Property Tax Code is amended by changing
5Section 9-265 as follows:
 
6    (35 ILCS 200/9-265)
7    Sec. 9-265. Omitted property; interest; change in exempt
8use or ownership.
9    (a) If any property is omitted in the assessment of any
10year or years, not to exceed the current assessment year and 3
11prior years, so that the taxes, for which the property was
12liable, have not been paid, or if by reason of defective
13description or assessment, taxes on any property for any year
14or years have not been paid, or if any taxes are refunded under
15subsection (b) of Section 14-5 because the taxes were assessed
16in the wrong person's name, the property, when discovered,
17shall be listed and assessed by the board of review or, in
18counties with 3,000,000 or more inhabitants, by the county
19assessor either on his or her own initiative or when so
20directed by the board of appeals or board of review.
21    (b) The board of review in counties with less than
223,000,000 inhabitants or the county assessor in counties with
233,000,000 or more inhabitants may develop reasonable

 

 

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1procedures for contesting the listing of omitted property
2under this Division.
3    (c) For purposes of this Section, "defective description
4or assessment" includes a description or assessment which
5omits all the improvements thereon as a result of which part of
6the taxes on the total value of the property as improved remain
7unpaid. In the case of property subject to assessment by the
8Department, the property shall be listed and assessed by the
9Department. All such property shall be placed on the
10assessment and tax books.
11    (d) The arrearages of taxes which might have been
12assessed, with 10% interest thereon for each year or portion
13thereof from 2 years after the time the first correct tax bill
14ought to have been received, shall be charged against the
15property by the county clerk.
16    (e) When property or acreage omitted by either incorrect
17survey or other ministerial assessor error is discovered and
18the owner has paid its tax bills as received for the year or
19years of omission of the parcel, then the interest authorized
20by this Section shall not be chargeable to the owner. However,
21nothing in this Section shall prevent the collection of the
22principal amount of back taxes due and owing.
23    (f) If any property listed as exempt by the chief county
24assessment officer has a change in use, a change in leasehold
25estate, or a change in titleholder of record by purchase,
26grant, taking or transfer, it shall be the obligation of the

 

 

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1transferee to notify the chief county assessment officer in
2writing within 90 days of the change. If mailed, the notice
3shall be sent by certified mail, return receipt requested, and
4shall include the name and address of the taxpayer, the legal
5description of the property, and the property index number of
6the property when an index number exists. If notice is
7provided in person, it shall be provided on a form prescribed
8by the chief county assessment officer, and the chief county
9assessment officer shall provide a date stamped copy of the
10notice. Except as provided in item (6) of subsection (a) of
11Section 9-260, item (6) of Section 16-135, and item (6) of
12Section 16-140 of this Code, if the failure to give the
13notification results in the assessing official continuing to
14list the property as exempt in subsequent years, the property
15shall be considered omitted property for purposes of this
16Code.
17    (g) In counties with fewer than 3,000,000 inhabitants, if
18a chief county assessment officer discovers at any time before
19judgment that a property has been granted a homestead
20exemption under Article 15 of this Code to which it was not
21entitled for the current assessment year or for any of the 3
22prior assessment years, the chief county assessment officer
23may consider the erroneously exempt portion of the property as
24omitted property under this Section for the assessment year in
25which the erroneous homestead exemption was applied to the
26property, but not including any assessment year that occurred

 

 

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1more than 3 years prior to the current assessment year. The
2county or its designated agent may use any remedy allowed by
3law to collect the taxes due on property that is omitted
4property under this subsection, plus interest in the amount of
510% per annum on those amounts, as well as any additional fees
6or costs incurred in identifying and collecting the unpaid
7taxes that taxable year only.
8    Any arrearage of taxes that might have been assessed
9against the omitted property but for the erroneous homestead
10exemption, as well as any interest, fees, or costs imposed on
11that property under this Section, shall not be chargeable to
12any bona fide purchaser for value who acquires the property
13without notice of the erroneous homestead exemption and whose
14rights in and to the underlying parcel arose after the
15erroneous homestead exemption was granted but before the
16erroneously exempt portion of the property was listed as
17omitted pursuant to this subsection. Nor shall those amounts
18be chargeable to any mortgagee, tax buyer, judgment creditor,
19or other lienor whose rights in and to the underlying parcel
20arose after the erroneous homestead exemption was granted but
21before the erroneously exempt portion of the property was
22listed as omitted.
23    A title insurance policy for the property that is issued
24by a title company licensed to do business in the State and
25that shows that the property is free and clear of any liens or
26arrearages imposed under this Section shall be prima facie

 

 

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1evidence that the person acquiring an interest in the property
2is without notice of the erroneous homestead exemption.
3(Source: P.A. 98-615, eff. 6-1-14.)
 
4    Section 99. Effective date. This Act takes effect upon
5becoming law.