Understanding Your Chicago Property Tax Bill

One of the new responsibilities that a first-time homeowner needs to be mindful of, beyond just Chicago mortgage rates, is the assessment of property taxes. The property tax bill that arrives has several different terms and numbers that may be confusing if you’ve never seen them before. Here’s a quick rundown of some of the features of the bill:

Fair Cash Value and Assessed Value

Fair cash value is a description of the buy/sell value of the property–what the owner can expect to receive if they were to sell their property at that moment.

Assessed value is the value that taxation is applied to, which may only be a portion of the property.

Equalized Assessed Value

The state applies an “equalization factor” to all property taxes in order to get a single, uniform assessment, and the EAV reflects the assessed value with that factor. The EAV, multiplied by the tax rate, will produce the final amount of the bill.

Property Tax Exemptions

Certain portions of the property may be considered exempt from taxation, and these will be noted in this section of the bill. There may even be considerations for which an entire property is exempted, such as church buildings.

Chicago Property Tax Rate

The aggregate rate of taxation is determined by adding up separate rates for different types of municipalities–for example, the bill may show an aggregate that combines rates for the city, county and school district. This is then multiplied by the EAV to produce the tax bill.

Something to keep in mind about your property tax payments are that your lender may have already set aside money for property taxes, and will cover the payment when it comes due. You will still receive the bill, but may not have to take action–so be careful to avoid double-paying!