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from Local Attorney, Michael H. Wasserman

Sunday, January 20, 2013

Tools of the Trade - CookCountyAssessor.com

Assessor's Web Site Screen Grab

by Michael H. Wasserman, Attorney at Law

Whenever a client hires me in connection with a local real estate purchase or sale, one of the first things I do is check out the local county assessor’s web site. For Cook County transactions, that would be here. The property search function allows home buyers, owners, and the professionals that represent them, many data points that can be critical to their deals. I am on this site every day.

What the Assessor’s Office Does

The Assessor sets the valuations (worth) of each of Cook County’s 1.8 millions parcels of property. These assessments are then plugged into the mathematical formula used to calculate our annual property taxes. Your property’s assessed value, in part, determines how much you will pay in property taxes. Taxes are likewise impacted by the use (or failure to claim) any of several recognized tax “exemptions.”

Why I Search

A check in with the County Assessor helps me assure clients that their purchase/sale deals are property documented and that they are being treated fairly in the allocation of real estate property taxes. I look for a couple of different things:

Property Identification

As obvious as this may seem, it is pretty important to confirm that the property my client is buying is the one that he or she actually intends to buy, and that it is described correctly in the contract. First stop is always a search to confirm the correct Property Index Numbers (PINs). Far too often they are wrong, or incomplete, or missing altogether from the contract. Likewise, a street address may be wrong or incomplete too. Searching a property by PIN can confirm a street address. Similarly, searching by street address can help identify the correct PIN. Knowing the PINs enables a searcher to check and confirm property tax amounts,  payment statuses & delinquencies, and make a preliminary title determinations.


Assessment History

Knowing the property's assessed value is pretty critical too, as it may help in evaluating the risk of a steep tax bill increase or decrease in the coming year. This is important in order to allocate property tax liabilities at closing. The County re-assesses every parcel of land once every three years. The Assessor's web site shows two years of assessments. We can see if an assessment has changed or if it is due to be changed soon.   A large drop off may possibly result in a lower tax liability. A steep rise may lead to tax increases. Knowledgeable buyers and sellers can leverage this information while negotiating their contract tax pro ration factors.

Exemption Status

Many homeowners are entitled to claim any (or all) of seven types of “exemptions” that can lower overall tax bills.  The search function allows two different paths to determine a property owner's historical use of these exemptions. Homeowners and Sellers who discover that they have failed to claim exemptions they were otherwise entitled to may be able to file “certificates of error” to claim a refund of such over-payments. These most commonly seem to involve missed “homeowners exemptions.” Very often, those refunds more than cover my legal fees for the overall sales transaction!

Buyers who discern that an exemption is going to be lost going forward may also be able to negotiate with their Sellers to either preserve the exemption or to adjust tax allocations accordingly. This happens most often in cases where the sellers are senior citizens or estates of recently deceased elders.  Successful efforts here can also realize significant property tax savings.

New Construction / Condo Conversions

New construction and condo conversion/rehabilitation deals present unique tax liability challenges for Buyers, their counsel, and their mortgage lenders. Very often a single tax parcel will be divided into separate pieces for each new apartment in a building or home in a subdivision. Taxes for prior years may also have been  assessed against vacant/undeveloped land. In such circumstances, Buyers face likely steep tax increases going forward, once the county adjusts property assessments to allow for the new construction. Knowing the timing of such changes are critical for the Buyer's planning purposes and for any Lender tax escrows.

The assessor's web site also includes some excellent other resources including a well stocked forms library and tools to help owners appeal to have their property assessments lowered.