Public Act 93-0657
SB1883 Enrolled LRB093 08674 SJM 08904 b
AN ACT concerning taxes.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Property Tax Code is amended by changing
Sections 31-5, 31-10, 31-20, and 31-25 and by adding Section
3-46 as follows:
(35 ILCS 200/31-5)
Sec. 31-5. Definitions. "Recordation" includes the
issuance of certificates of title by Registrars of Title
under the Registered Titles (Torrens) Act pursuant to the
filing of deeds or trust documents for that purpose, as well
as the recording of deeds or trust documents by recorders.
"Department" means the Department of Revenue.
"Person" means any natural individual, firm, partnership,
association, joint stock company, joint adventure, public or
private corporation, limited liability company, or a
receiver, executor, trustee, guardian or other representative
appointed by order of any court.
"Value" means the amount of the full actual consideration
for the real property, including the amount of any lien on
the real property assumed by the buyer.
"Trust document" means a document required to be recorded
under the Land Trust Recordation and Transfer Tax Act.
"Beneficial interest" includes, but is not limited to:
(1) the beneficial interest in an Illinois land
trust;
(2) the lessee interest in a ground lease
(including any interest of the lessee in the related
improvements) that provides for a term of 30 or more
years when all options to renew or extend are included,
whether or not any portion of the term has expired; or
(3) the indirect interest in real property as
reflected by a controlling interest in a real estate
entity.
"Controlling interest" means more than 50% of the fair
market value of all ownership interests or beneficial
interests in a real estate entity.
"Real estate entity" means any person including, but not
limited to, any partnership, corporation, limited liability
company, trust, other entity, or multi-tiered entity, that
exists or acts substantially for the purpose of holding
directly or indirectly title to or beneficial interest in
real property. There is a rebuttable presumption that an
entity is a real estate entity if it owns, directly or
indirectly, real property having a fair market value greater
than 75% of the total fair market value of all of the
entity's assets, determined without deduction for any
mortgage, lien, or encumbrance.
(Source: P.A. 92-651, eff. 7-11-02.)
(35 ILCS 200/31-10)
Sec. 31-10. Imposition of tax. A tax is imposed on the
privilege of transferring title to real estate located in
Illinois, as represented by the deed that is filed for
recordation, and on the privilege of transferring a
beneficial interest in real property located in Illinois that
is the subject of a land trust as represented by the trust
document that is filed for recordation, and on the privilege
of transferring a controlling interest in a real estate
entity owning property located in Illinois, at the rate of
50¢ for each $500 of value or fraction of $500 stated in the
declaration required by Section 31-25. If, however, the deed
or trust document states that the real estate, beneficial
interest, or controlling interest is transferred subject to a
mortgage, the amount of the mortgage remaining outstanding at
the time of transfer shall not be included in the basis of
computing the tax. The tax is due if the transfer is made by
one or more related transactions or involves one or more
persons or entities and whether or not a document is
recorded.
(Source: P.A. 86-624; 86-925; 86-1028; 86-1475; 87-543;
88-455.)
(35 ILCS 200/31-20)
Sec. 31-20. Affixing of stamps. Payment of the tax shall
be evidenced by revenue stamps in the amount required to show
full payment of the tax imposed by Section 31-10. Except as
provided in Section 31-45, a deed, document transferring a
controlling interest in real property, or trust document
shall not be accepted for filing by any recorder or registrar
of titles unless revenue stamps in the required amount have
been purchased from the recorder or registrar of titles of
the county where the deed, document transferring a
controlling interest in real property, or trust document is
being filed for recordation. The revenue stamps shall be
affixed to the deed, document transferring a controlling
interest in real property, or trust document by the recorder
or the registrar of titles either before or after recording
as requested by the grantee. A person using or affixing a
revenue stamp shall cancel it and so deface it as to render
it unfit for reuse by marking it with his or her initials and
the day, month and year when the affixing occurs. The
marking shall be made by writing or stamping in indelible ink
or by perforating with a machine or punch. However, the
revenue stamp shall not be so defaced as to prevent ready
determination of its denomination and genuineness.
(Source: P.A. 86-624; 86-925; 86-1028; 86-1475; 87-543;
88-455.)
(35 ILCS 200/31-25)
Sec. 31-25. Transfer declaration. At the time a deed, a
document transferring a controlling interest in real
property, or trust document is presented for recordation, or
within 3 business days after the transfer is effected,
whichever is earlier, there shall also be presented to the
recorder or registrar of titles a declaration, signed by at
least one of the sellers and also signed by at least one of
the buyers in the transaction or by the attorneys or agents
for the sellers or buyers. The declaration shall state
information including, but not limited to: (a) the value of
the real property or beneficial interest in real property
located in Illinois the full consideration for the property
so transferred; (b) the parcel identifying number of the
property; (c) the legal description of the property; (d) the
date of the deed, the date the transfer was effected, or the
date of the trust document; (e) the type of deed, transfer,
or trust document; (f) the address of the property; (g) the
type of improvement, if any, on the property; (h) information
as to whether the transfer is between related individuals or
corporate affiliates or is a compulsory transaction; (i) the
lot size or acreage; (j) the value of personal property sold
with the real estate; (k) the year the contract was initiated
if an installment sale; and (l) the name, address, and
telephone number of the person preparing the declaration.
Except as provided in Section 31-45, a deed, a document
transferring a controlling interest in real property, or
trust document shall not be accepted for recordation unless
it is accompanied by a declaration containing all the
information requested in the declaration. When the
declaration is signed by an attorney or agent on behalf of
sellers or buyers who have the power of direction to deal
with the title to the real estate under a land trust
agreement, the trustee being the mere repository of record
legal title with a duty of conveying the real estate only
when and if directed in writing by the beneficiary or
beneficiaries having the power of direction, the attorneys or
agents executing the declaration on behalf of the sellers or
buyers need identify only the land trust that is the
repository of record legal title and not the beneficiary or
beneficiaries having the power of direction under the land
trust agreement. The declaration form shall be prescribed by
the Department and shall contain sales information questions.
For sales occurring during a period in which the provisions
of Section 17-10 require the Department to adjust sale prices
for seller paid points and prevailing cost of cash, the
declaration form shall contain questions regarding the
financing of the sale. The subject of the financing
questions shall include any direct seller participation in
the financing of the sale or information on financing that is
unconventional so as to affect the fair cash value received
by the seller. The intent of the sales and financing
questions is to aid in the reduction in the number of buyers
required to provide financing information necessary for the
adjustment outlined in Section 17-10. For sales occurring
during a period in which the provisions of Section 17-10
require the Department to adjust sale prices for seller paid
points and prevailing cost of cash, the declaration form
shall include, at a minimum, the following data: (a) seller
paid points, (b) the sales price, (c) type of financing
(conventional, VA, FHA, seller-financed, or other), (d) down
payment, (e) term, (f) interest rate, (g) type and
description of interest rate (fixed, adjustable or
renegotiable), and (h) an appropriate place for the inclusion
of special facts or circumstances, if any. The Department
shall provide an adequate supply of forms to each recorder
and registrar of titles in the State.
(Source: P.A. 91-555, eff. 1-1-00.)
(35 ILCS 200/31-46 new)
Sec. 31-46. Exemption from tax equal to corporate
franchise taxes paid. If a transfer of a controlling interest
in a real estate entity is taxed under this Article and the
real estate entity liable for the tax under this Article is
also liable for corporate franchise taxes under the Business
Corporation Act of 1983 as a result of the transfer, then the
real estate entity is exempt from paying the tax imposed
under this Article to the extent of the corporate franchise
tax paid by the real estate entity as a result of the
transfer. The exemption shall not reduce the real estate
entity's tax liability under this Article to less than zero.
Section 10. The Stock, Commodity, or Options Transaction
Tax Exemption Act is amended by adding Section 3 as follows:
(35 ILCS 820/3 new)
Sec. 3. Construction of Act. Nothing in this Act shall
be construed as prohibiting or otherwise invalidating any
real estate transfer tax or fee authorized or permitted by
Section 31-10 of the Property Tax Code, Section 5-1031.1 of
the Counties Code, or Section 8-3-19 of the Illinois
Municipal Code. This Section is intended as a clarification
and not as a change to existing law.
Section 15. The Counties Code is amended by changing
Section 5-1031.1 as follows:
(55 ILCS 5/5-1031.1)
Sec. 5-1031.1. Home rule real estate transfer taxes.
(a) After the effective date of this amendatory Act of
the 93rd General Assembly 1996 and subject to this Section, a
home rule county may impose or increase a tax or other fee on
the privilege of transferring title to real estate, as
represented by the deed that is filed for recordation, and on
the privilege of transferring a beneficial interest in a land
trust holding legal title to real property, and on the
privilege of transferring a controlling interest in a real
estate entity, as the terms "beneficial interest",
"controlling interest", and "real estate entity" are defined
in Article 31 of the Property Tax Code as represented by the
trust document that is filed for recordation. Such a tax or
other fee on the privilege of transferring title to real
estate, as represented by the deed that is filed for
recordation, and on the privilege of transferring a
beneficial interest in a land trust holding legal title to
real property, as represented by the trust document that is
filed for recordation, shall hereafter be referred to as a
real estate transfer tax.
(b) Before adopting a resolution to submit the question
of imposing or increasing a real estate transfer tax to
referendum, the corporate authorities shall give public
notice of and hold a public hearing on the intent to submit
the question to referendum. This hearing may be part of a
regularly scheduled meeting of the corporate authorities.
The notice shall be published not more than 30 nor less than
10 days prior to the hearing in a newspaper of general
circulation within the county. The notice shall be published
in the following form:
Notice of Proposed (Increased) Real Estate Transfer
Tax for (commonly known name of county).
A public hearing on a resolution to submit to
referendum the question of a proposed (increased) real
estate transfer tax for (legal name of the county) in an
amount of (rate) to be paid by the buyer (seller) of the
real estate transferred will be held on (date) at (time)
at (location). The current rate of real estate transfer
tax imposed by (name of county) is (rate).
Any person desiring to appear at the public hearing
and present testimony to the taxing district may do so.
(c) A notice that includes any information not specified
and required by this Section is an invalid notice. All
hearings shall be open to the public. At the public hearing,
the corporate authorities of the county shall explain the
reasons for the proposed or increased real estate transfer
tax and shall permit persons desiring to be heard an
opportunity to present testimony within reasonable time
limits determined by the corporate authorities. A copy of
the proposed ordinance shall be made available to the general
public for inspection before the public hearing.
(d) No home rule county shall impose a new real estate
transfer tax after the effective date of this amendatory Act
of 1996 without prior approval by referendum. No home rule
county shall impose an increase of the rate of a current real
estate transfer tax without prior approval by referendum. A
home rule county may impose a new real estate transfer tax or
may increase an existing real estate transfer tax with prior
referendum approval. The referendum shall be conducted as
provided in subsection (e). An existing ordinance or
resolution imposing a real estate transfer tax may be amended
without approval by referendum if the amendment does not
increase the rate of the tax or add transactions on which the
tax is imposed.
(e) The home rule county shall, by resolution, provide
for submission of the proposition to the voters. The home
rule county shall certify the resolution and the proposition
to the proper election officials in accordance with the
general election law. If the proposition is to impose a new
real estate transfer tax, it shall be in substantially the
following form: "Shall (name of county) impose a real estate
transfer tax at a rate of (rate) to be paid by the buyer
(seller) of the real estate transferred, with the revenue of
the proposed transfer tax to be used for (purpose)?". If the
proposition is to increase an existing real estate transfer
tax, it shall be in the following form: "Shall (name of
county) impose a real estate transfer tax increase of
(percent increase) to establish a new real estate transfer
tax rate of (rate) to be paid by the buyer (seller) of the
real estate transferred? The current rate of the real estate
transfer tax is (rate), and the revenue is used for
(purpose). The revenue from the increase is to be used for
(purpose).".
If a majority of the electors voting on the proposition
vote in favor of it, the county may impose or increase the
real estate transfer tax.
(f) Nothing in this amendatory Act of 1996 shall limit
the purposes for which real estate transfer tax revenues may
be collected or expended.
(g) A home rule county may not impose real estate
transfer taxes other than as authorized by this Section. This
Section is a denial and limitation of home rule powers and
functions under subsection (g) of Section 6 of Article VII of
the Illinois Constitution.
(h) Notwithstanding subsection (g) of this Section, any
real estate transfer taxes adopted by a county at any time
prior to January 17, 1997 (the effective date of Public Act
89-701) and any amendments to any existing real estate
transfer tax ordinance adopted after that date, in accordance
with the law in effect at the time of the adoption of the
amendments, are not preempted by this amendatory Act of the
93rd General Assembly.
(Source: P.A. 89-701, eff. 1-17-97; 90-14, eff. 7-1-97.)
Section 20. The Illinois Municipal Code is amended by
changing Section 8-3-19 as follows:
(65 ILCS 5/8-3-19)
Sec. 8-3-19. Home rule real estate transfer taxes.
(a) After the effective date of this amendatory Act of
the 93rd General Assembly 1996 and subject to this Section, a
home rule municipality may impose or increase a tax or other
fee on the privilege of transferring title to real estate, as
represented by the deed that is filed for recordation, and on
the privilege of transferring a beneficial interest in a land
trust holding legal title to real property, and on the
privilege of transferring a controlling interest in a real
estate entity, as the terms "beneficial interest",
"controlling interest", and "real estate entity" are defined
in Article 31 of the Property Tax Code as represented by the
trust document that is filed for recordation. Such a tax or
other fee on the privilege of transferring title to real
estate, as represented by the deed that is filed for
recordation, and on the privilege of transferring a
beneficial interest in a land trust holding legal title to
real property, as represented by the trust document that is
filed for recordation, shall hereafter be referred to as a
real estate transfer tax.
(b) Before adopting a resolution to submit the question
of imposing or increasing a real estate transfer tax to
referendum, the corporate authorities shall give public
notice of and hold a public hearing on the intent to submit
the question to referendum. This hearing may be part of a
regularly scheduled meeting of the corporate authorities.
The notice shall be published not more than 30 nor less than
10 days prior to the hearing in a newspaper of general
circulation within the municipality. The notice shall be
published in the following form:
Notice of Proposed (Increased) Real Estate Transfer
Tax for (commonly known name of municipality).
A public hearing on a resolution to submit to
referendum the question of a proposed (increased) real
estate transfer tax for (legal name of the municipality)
in an amount of (rate) to be paid by the buyer (seller)
of the real estate transferred will be held on (date) at
(time) at (location). The current rate of real estate
transfer tax imposed by (name of municipality) is (rate).
Any person desiring to appear at the public hearing
and present testimony to the taxing district may do so.
(c) A notice that includes any information not specified
and required by this Section is an invalid notice. All
hearings shall be open to the public. At the public hearing,
the corporate authorities of the municipality shall explain
the reasons for the proposed or increased real estate
transfer tax and shall permit persons desiring to be heard an
opportunity to present testimony within reasonable time
limits determined by the corporate authorities. A copy of the
proposed ordinance shall be made available to the general
public for inspection before the public hearing.
(d) No home rule municipality shall impose a new real
estate transfer tax after the effective date of this
amendatory Act of 1996 without prior approval by referendum.
No home rule municipality shall impose an increase of the
rate of a current real estate transfer tax without prior
approval by referendum. A home rule municipality may impose
a new real estate transfer tax or may increase an existing
real estate transfer tax with prior referendum approval. The
referendum shall be conducted as provided in subsection (e).
An existing ordinance or resolution imposing a real estate
transfer tax may be amended without approval by referendum if
the amendment does not increase the rate of the tax or add
transactions on which the tax is imposed.
(e) The home rule municipality shall, by resolution,
provide for submission of the proposition to the voters. The
home rule municipality shall certify the resolution and the
proposition to the proper election officials in accordance
with the general election law. If the proposition is to
impose a new real estate transfer tax, it shall be in
substantially the following form: "Shall (name of
municipality) impose a real estate transfer tax at a rate of
(rate) to be paid by the buyer (seller) of the real estate
transferred, with the revenue of the proposed transfer tax to
be used for (purpose)?". If the proposition is to increase
an existing real estate transfer tax, it shall be in the
following form: "Shall (name of municipality) impose a real
estate transfer tax increase of (percent increase) to
establish a new transfer tax rate of (rate) to be paid by the
buyer (seller) of the real estate transferred? The current
rate of the real estate transfer tax is (rate), and the
revenue is used for (purpose). The revenue from the increase
is to be used for (purpose).".
If a majority of the electors voting on the proposition
vote in favor of it, the municipality may impose or increase
the municipal real estate transfer tax or fee.
(f) Nothing in this amendatory Act of 1996 shall limit
the purposes for which real estate transfer tax revenues may
be collected or expended.
(g) A home rule municipality may not impose real estate
transfer taxes other than as authorized by this Section. This
Section is a denial and limitation of home rule powers and
functions under subsection (g) of Section 6 of Article VII of
the Illinois Constitution.
(h) Notwithstanding subsection (g) of this Section, any
real estate transfer taxes adopted by a municipality at any
time prior to January 17, 1997 (the effective date of Public
Act 89-701) and any amendments to any existing real estate
transfer tax ordinance adopted after that date, in accordance
with the law in effect at the time of the adoption of the
amendments, are not preempted by this amendatory Act of the
93rd General Assembly.
(Source: P.A. 89-701, eff. 1-17-97.)