Update and Fix the Illinois Disabled Veteran Real Estate Tax Exemption

Update and Fix the Illinois Disabled Veteran Real Estate Tax Exemption

71 have signed. Let’s get to 100!

Why this petition matters

Started by Doug Katz

For veterans with service connected disability, there is an Illinois Disabled Veteran Real Estate Tax Exemption which provides partial exemption starting at 30% and full exemption starting at 70% service connected disability.   This is an amazing and unique program that honors our disabled veterans and provides incentive for them to live and work in Illinois.  In a time of significant migration out of the state, this is not an insignificant thing.

The current application of the exemption is, however, vague, inconsistent and problematic.  In some counties, such as Cook County, the law has no caps or limitations in home value.  In other counties, it is capped at a value of $750,000 in home valuation at which point it disappears completely, i.e. a cliff where a qualified veteran can experience significant payment shock.

Additionally, the law was signed into law in 2015 and has not been adjusted for the unprecedented double digit appreciation in home values over the last few years and other inflation.  At the point it was written, inflation was not a huge consideration, but the inflated values of homes could easily drive a veteran who purchased a moderately valued home off of the aforementioned value cliff.  In a state with some of the highest real estate taxes in the country, this can be a major blow creating hardship and/or an incentive to relocate out of Illinois.

The impact on the state's revenue is minimal as only an estimated 5.7% of Illinois residents are veterans.  Nationally, ~18% of veterans have a disability rating of 30% or more which means that this exemption applies to a maximum of roughly 1% of the population of Illinois.  This number is far less that 1% of the population for veterans with a 70% rating or higher.  In simple terms, this means that it is not a serious revenue consideration for the state, but it is a huge consideration for our disabled veterans.

Please sign the petition of help Illinois Disabled Veterans by having Illinois lawmakers amend the Illinois Disabled Veterans Real Estate Tax Exemption through one or more of the following adjustments to the exemption:

  1. Adjust or eliminate the cap to account for home price appreciation and inflation (see second bullet).  If the cap was valid at the time that the law was written, it is now out of sync with current home prices and/or projected home prices.
  2. Amend the exemption to eliminate the cliff by changing the complete loss of the benefit to a cap on the benefit based on average home values whereby the disabled veteran would pay the delta between the maximum benefit and their actual taxes when they reach a benefit limit.  This would allow for disabled veteran homeowners with lower valued homes to have a benefit unchanged from the current structure while preserving the benefit for veterans with higher priced homes and those more impacted by runaway home price inflation.
71 have signed. Let’s get to 100!