Property tax abatement for the renovation of industrial buildings

On Behalf of | Jan 25, 2021 | tax law | 0 comments

Cook county offers a property tax abatement for owners of industrial buildings who perform a major property rehabilitation. The purpose of this incentive is to encourage industrial development.

The county normally assesses industrial real estate at 25% of its market value. Owners who participate in this incentive program will have to pay taxes based on only 10% of an industrial property’s market value for 10 years. To get a property tax reduction through the program, applicants must attain a Class 6B certification by meeting several key criteria.

Submit a complete application

Owners must complete a Class 6B Sustainable Emergency Relief application in its entirety and include all relevant supporting documentation along with a $500 filing fee. Owners have to make the filing prior to the commencement of work, but they may not file more than one year before commencement.

Demonstrate industrial usage

A tax abatement through the SER program is available only to properties that have an industrial purpose. The county’s definition of what constitutes an industrial purpose is primarily limited to the manufacturing or distribution of raw materials or goods. Materials to submit with an application that demonstrate industrial usage may include a business plan or photographs.

Show economic hardship

Applicants must demonstrate some form of financial hardship. They will need to submit financial statements as well as an explanatory letter.

Owners of industrial properties should carefully evaluate the benefits of a 6B SER tax reduction. The SER program offers considerable savings over many years, but it may preclude participation in other incentive programs.