Homestead Exemptions and Rental Property in Illinois
Currently, homeowners can claim a homestead exemption, lowering their taxes on their primary residence. Many times, tenants renting a single-family home can also qualify for a homestead exemption if they are responsible for paying the real estate taxes on the home; in most counties, the tenant’s lease must state that a portion of the monthly rent is used toward taxes.
Unfortunately, there are people claiming homestead exemptions on homes they don’t live in and other investment properties. As a result, proposed legislation is pending which would allow the county to eliminate the homestead exemption on a home that previously qualified for the exemption, if that home was not, in fact, owner-occupied. Counties could also insist that the owners of such properties refund exemptions that they previously received. Counties could even assess fines against such property-owners. Moreover, there is a move towards eliminating the loophole for single-family residences that are rented.
Understandably, landlords are up in arms. Their primary argument is that the various county assessors will not implement and enforce any new laws uniformly. Some landlords may face heavy fines, while others may get away with a slap on the wrist. Moreover, the new laws could make real estate ownership even less affordable for many landlords, especially those who are barely making it right now.
Supporters of the legislation, on the other hand, state that landlords are essentially cheating and are improperly benefiting from the homestead exemption on properties in addition to their primary residence. They feel that this defeats the purpose of the homestead exemption, and that it’s just not fair.
It remains to be seen if the legislation gets passed, but landlords should be aware that things may change very soon!
Hi Naheed,
Do you know where this legislation stands? I am a landlord in will county, and would like to know if I can avail this.
Thanks.
I’m not sure about Will County, but the legislation went into effect in Cook County last year!
Thanks.
I live in a house that my father bought and I will be paying the property taxes and insurance. Will the homestead benefit me if I qualify. Adams County
Hi Rick,
In Cook County, if you rent a home, live in it on the first of the year, and have a written lease that specifies you pay the real estate taxes, you can qualify for the homeowner’s exemption. However, I would recommend you call the Adams County Assessor’s office and ask them if you qualify because each county is different.
Hi Naheed
I live in Cook county, have owned and lived in a condo for approx 5 years. I filed for tax exempt when I was living there. We moved out and rented the unit back in 2014 while it was still under tax exempt. I do pay taxes on the property and on the rental income. The condo is still under tax exempt. Based on your comments above I do qualify for homeoever’s Exemption on this unit while being rented ?
thanks
Asad U
Hi Asad,
I’m not sure what you mean by “tax exempt”. Do you mean that you were receiving a homeowner’s exemption? If that’s the case, and you no longer live in the condo, then you no longer qualify for the homeowner’s exemption. The homeowner’s exemption is meant for your primary residence only.
Hi,
I used to live in a condo that I owned and had homeowners exemption. I got married and bought a home. The condo I owned is now currently being lived in by my brother-in-law and his fiance’, rent free. We are doing this in order to them out financially.
Can I still claim homeowner’s exemption on the condo? The property is in Cook County
Thanks!
Hi,
You should only claim a homeowner’s exemption on your primary residence. It sounds like you have moved out of your condo and you are living in a house.
Hello,
A deceased aunt willed her house to my cousins and I. One cousin named in the will lived in the home prior to my aunt’s death and continues to live in the home. Are we entitled to the homeowners exemption as this is now heir property? Would the will be sufficient for establishing homeownership?
Hi,
If the home was pr is in your aunt’s name, your aunt was the only one who could qualify for the homeowner’s exemption. If your cousin was left the property in a will, the will will need to be filed and probated.
My current rent has been 2,000 a month for 2yrs. The landlord notified me that my 2022 rent will increase by $250, is this legal in Cook County, illinois
Hi, If your lease is over, the parties can negotiate a new rent. If the parties cannot reach an agreement, the tenant can leave. If your lease is not over (i.e. it will continue for 2022), then the landlord should honor the rent in the lease.