What is the Senior Citizens’ Tax Deferral program?
The Senior Citizens’ Tax Deferral is a program that provides tax relief by allowing qualified senior citizens to defer all or part of the property taxes on their personal residence. It’s a form of a loan with a six percent interest rate, which must be repaid after the taxpayer’s death, or at the time the property is sold. The deferral is similar to a loan against the property’s market value. Deferred amounts are “borrowed” from the State of Illinois, who pays the tax bill. To ensure repayment, a six percent simple interest rate is charged on the deferred amounts and a lien is filed on the property. The six percent interest is charged for each year that the deferred amount is carried. For example, a $2,000 tax amount deferred for one year would equal interest of $120. If not paid off in the first year, the interest would grow to $240 at the end of the second year, $360 at the end of the third year, and so on.
