Cook County ‘Bed & Breakfasts’ reclassified for 2015 assessments

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The IAR Government Affairs team is working with the Cook County Assessor’s Office to find out what a policy change means for the property tax assessment classification for current and future “Bed & Breakfast” owners.

Although previously considered commercial properties by the assessor’s office, Deputy Assessor of Valuation and Appeals Thomas A. Jaconetty says all of the 40-plus B&Bs in Cook County are now classified as “5-97s” or “special commercial improvements,” though owners can appeal.

Mike Scobey

In a conference call with IAR Assistant Director Mike Scobey, Jaconetty said the decision to change policy was made so future assessments would be more uniform and equitable.

Each appeal will be decided individually, Jaconetty says, based on business and financial information submitted by owners through the appeals process.  A list of information needed on all appeals includes:

  • documentation to show if any portion of the property is owner occupied;
  • a full narrative appraisal or appraisals indicating fair cash value on Jan. 1, 2015;
  • square footage;
  • audited income and expense statements for 2012, 2013 and 2014;
  • income for 2012, 2013, 2014 and 2015 (to date); and
  • a detailed narrative brief discussing all relevant factual and legal issues.

The policy change was posted on a “Bed & Breakfast” page on the site of the Cook County Assessor’s Office. But Jaconetty says all of the affected Bed & Breakfast owners have been identified and individually contacted by the assessor’s office.

The fact that Cook County bed & breakfasts had been previously classified as commercial properties came to Jaconetty’s attention several years ago, but he put the idea to change classifications on hold until recently. He says members of the assessor’s office are working in a cooperative spirit with Bed & Breakfast owners.

He noted that because the assessor’s office is recommending the policy change, Illinois law limits what can be collected in property taxes from B&Bs. The reclassification is only for assessments in 2015 and beyond (property taxes payable in 2016), and it will not be applied retroactively.

If a B&B is the owner’s primary residence, it is likely that it will be classified as residential property, says Jaconetty. However, an appeal to the assessor is necessary. Commercial properties are assessed at 25 percent, while residential properties with fewer than six units are assessed at 10 percent.

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