Several Counties Change Property Tax Due Dates or Waive Interest on Late Payments
Several County governments have taken steps to move the due dates for property tax payments or have eliminated the penalty provisions for taxpayers who do not pay taxes on time. To date, we are aware of four counties that have acted to effectively change the due date of the first or second installment of 2019 taxes, payable in 2020. The steps these counties have taken, and the counties involved are summarized in the following.
Today the County Board approved an ordinance allowing “owners of real property located in DuPage County” to apply to the County Treasurer “stating facts which support that they have been adversely affected financially by the COVID-19 disaster.” To demonstrate financial hardship, the property owner must attest that any of the following situations applies to them: 1) the person was laid off or terminated from employment after March 9, 2020; 2) the taxpayer has experienced a reduction in income of 20% or greater; 3) the person is unable to collect at least 80% of collectible rent on the property they own for the period March 1 to May 30, 2020; or 4) the property owner’s business has been shutdown as a ‘non-essential business’ by the Governor’s executive orders and that the person has not applied for and received a loan under the Paycheck Protection Program under the CARES Act. For qualifying applicants, no interest or penalties will accrue on late payment of the first installment due June 1. Provided the June 1 payment is made by September 1 (the second installment due date), the June payment will be considered timely. Normally late payment accrue interest at 1.5% interest per month. The ordinance specifically states that escrowed tax payments (which represent about 40% of taxes paid in DuPage Co.) are not eligible for this program. The ordinance also states that it does not amend the second installment due date of September 1 and that any June 1 payment not made by September 1 will incur interest and penalties retroactive to June 1. You can review the application here.
On April 14th the County Board approved an ordinance waiving any interest and penalties on the payment of the first installment provided it is made by July 1st. This effectively allows a taxpayer to pay the first installment by July 1, rather than the due date of June 1, and suffer no interest or penalties. Like in DuPage County, the Kane ordinance does not alter the second installment due date of September 1.
On April 13th the County Board eliminated any interest or penalties on the payment of the June first installment provided the full payment is made by the second installment due date of September 12th. This action effectively makes the full 2019 tax payment due no later than September 12th for those taxpayers who chose not to make the first installment payment in June.
St. Clair County
The County Board decided to mail tax bills later than normal. Typically, the tax bills are mailed by May 1st to allow 30 days receipt for the payment of the first installment due June 1. The County Board decided that it would mail bills on June 15 with a first installment due date of July 30 and a second installment due date of September 30.
DuPage and Kane Counties specifically cite to Section 21-40 of the Property Tax Code in their ordinances. Sec. 21-40 allows a county board to modify payment dates or waive interest and/or penalties when there has been a Presidential or Gubernatorial disaster declaration. However, the statute speaks to properties that are substantially damaged or adversely affected by the natural disaster, not individuals who are adversely affected. We are not aware of any other counties that have modified the property tax payment dates. If you are aware of other situations, please let us know.
We will continue to monitor the changes prompted by COVID-19 as they affect Illinois school districts and the property tax assessment, appeal, and collection process and bring you more information as it becomes available. For more information on this topic contact the authors of this alert or any other Franczek attorney.