Bill
SB 1862
Illinois establishes a 30-year owner-occupied homestead exemption that fully exempts qualifying principal residences from property taxes, with annual reapplication and review.
Status and timeline
- Introduced in the 104th General Assembly (early 2025); enacted and signed by the Governor on June 20, 2025.
- Became effective September 1, 2025.
- Primary sponsor: Sen. Neil Anderson. Multiple cosponsors including Sen. Jason Plummer, Chapin Rose, Linda Holmes, and others.
Purpose
- Establish a new homestead exemption that fully exempts qualifying long‑term owner-occupied residential property from property taxation under the Property Tax Code once the owner has continuously owned and occupied the home as their principal residence for at least 30 years.
Key provisions
- New statute added to the Property Tax Code (35 ILCS 200/15-177.1): Beginning with taxable year 2025 and each year thereafter, a "qualified homestead property" that has been continuously owned, used, and occupied as the taxpayer’s primary residence for at least 30 continuous years (as of January 1 of the taxable year) is exempt from taxation under the Code.
- The exemption appears as a full exemption from taxation under the Code for qualifying property.
- Annual reapplication requirement: taxpayers who receive the exemption must reapply each year during the county’s established application period.
- Eligibility verification and administration: assessors or chief county assessment officers may determine eligibility by application, visual inspection, questionnaire, or other reasonable methods; they may require documentation and enter into intergovernmental information‑sharing agreements to verify claims.
- Review: the chief county assessment official must, by December 31 of the first year of each reassessment cycle, review all exemptions granted during the preceding reassessment cycle to identify erroneous awards.
- Definitions:
- "Qualified taxpayer" — an individual who has occupied the same homestead as principal residence and domicile for at least 30 continuous years as of Jan 1 of the taxable year.
- "Qualified homestead property" — residential property on which that individual has the required ownership/occupancy; includes situations where a lessee has legal/equitable interest via written instrument and is liable for property taxes (single‑family principal residence).
- State Mandates Act amended (30 ILCS 805/8.49): implementation of this Act is declared an “exempt mandate,” meaning the State is not required to reimburse local governments for costs of implementing the exemption.
Who is affected
- Primary beneficiaries: long‑term homeowners (30+ years continuous ownership and occupancy) of qualifying residential/single‑family properties in Illinois.
- Local taxing districts and other taxing bodies could see reduced property tax revenue to the extent properties become fully exempt.
- County assessors and clerk offices will have increased administrative responsibilities for application processing, verification, and periodic reviews.
- No state reimbursement required for local implementation costs.
Potential impacts and issues to consider
- Fiscal: potentially significant reductions in property tax base for affected parcels; fiscal impacts will vary by locality depending on number of eligible properties.
- Equity and targeting: program targets very long‑term owners, which may confer substantial tax savings to older homeowners or long‑time residents; not portable and limited to owner‑occupied principal residences meeting the continuous‑occupancy test.
- Administrative burden: annual reapplication and verification procedures may increase workload for county assessment officials; intergovernmental data sharing allowed to aid verification.
- Enforcement/control: scheduled reassessment-cycle reviews are required to detect erroneous grants, but the law relies on local processes for ongoing eligibility determinations.
For further detail, see the enacted text adding 35 ILCS 200/15-177.1 (Property Tax Code) and 30 ILCS 805/8.49 (State Mandates Act).
Compiled from official sources — confirm details with the bill’s official record.
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