Understanding
Your Assessment

Property assessment is a complex, detail-oriented process that encompasses a range of disciplines and resources.

In this article, we will try to give you a brief, general view of how your property is assessed and how your assessment relates to market value.

All property assessments consist of a land component and (unless vacant) a building component. You may sometimes see the building component referred to as the "improvement;" this term reflects the fact that, in legal terms, any building represents an "improvement" on the vacant land underlying it. Further, any structure affixed to the underlying land (including houses, barns, pools, et al.) may be considered an improvement for property assessment purposes. 

Land may be valued on a square-foot, front-foot, or site basis. Building values are typically derived from cost schedules adjusted for local market conditions; these are usually applied based on building square footage and amenities. Regardless of the specific method used, the land and building components together must yield an assessment figure that is accurate in regard to market value and equitable with comparable properties.

Assessments in Illinois are governed by the Illinois Revised Revenue Act. The statute requires that real property in Illinois must be assessed at a median level of 33.3333 % (thirty-three and one-third percent) for property tax purposes of market value. (The only exception to this is Cook County, a home rule government entity that has established a different set of assessment levels for its jurisdiction).

The above does not mean that every given property will be assessed at exactly one-third of its value. Rather, the statute stipulates that the overall level of assessments in a given area will be at 33.3333 % of market value. Individual homes may be below, at, or above this level; however, every home's assessment must be uniform with comparable properties within its neighborhood. In order to maximize and maintain uniformity and accuracy of assessment among all properties, each year the Assessor's Office utilizes a range of statistical measures and adjustments; these include sales studies, COD (Co-efficient of Dispersion) abstracts, and PRD (Price-Related Differential) studies.

These studies and measures help isolate problem areas and possible solutions, which may range from neighborhood multipliers to physical reassessment of homes in a given area or classification. Additionally, the County Supervisor of Assessments Office does its own sales-ratio study each year; based on this, the SA recommends an annual township-wide multiplier to factor all assessments to the state-mandated 33.3333% median level of assessment. Every four years, the Assessor's Office performs its own in-house Quadrennial Reassessment; during this time, the assessments of all parcels are reviewed and adjusted on a neighborhood by neighborhood basis.

In addition to arriving at accurate assessments, the Assessor must also keep accurate records of all parcels in the jurisdiction. Assessment records must reflect any legal changes to vacant and improved land parcels as well as physical changes to buildings or structures. The Assessor's Office is thus required to inspect and add all new construction to its records. New homes may be subject to a prorated assessment based on date of occupancy; homes that have added additions or amenities must have their assessments adjusted to reflect those improvements. (Owner-occupied homes that have had their assessments increase due to such improvements automatically qualify for the Home Improvement Exemption).

Once the Assessor has completed all necessary updates to his or her records and any appropriate statistical studies, the assessment books can be closed and his (or her) role in the assessment process is ended. At that point, the formulation of the tax rate begins, a process independent of the Assessor's Office and its work. For more information, see Understanding Your Tax Rate.