Cook County Board President Toni Preckwinkle said Thursday her office is going after businesses and individuals that avoid paying transfer taxes on real estate transactions by undervaluing the property they sell.
Cook County's Department of Revenue will audit real property transfer tax returns filed with the Recorder of Deeds to identify improper exemptions and determine whether individuals undervalue the sale of real estate in order to pay fewer taxes. The transfer tax is levied on all real estate sales in Cook County at $0.25 per $500 of the transfer price.
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If unwarranted exemptions are found, the county will require the seller to pay a penalty equal to the amount of the tax owed to the Recorder of Deeds and a $1,000 fine.
"This tax dodge is most commonly used on large commercial real estate deals when sellers claim unwarranted exemptions or misrepresent the value of their property or transfer price," Preckwinkle said.
"These tax exemptions are for benevolent organizations or people in financial difficulty. Yet, too many people take advantage of the system to avoid paying their fair share."