The Illinois General Assembly has passed Senate Bill 642, a bipartisan measure that would expand property tax relief for senior citizens on fixed incomes, and the legislation now awaits Governor JB Pritzker’s signature.

The bill addresses the burden of Illinois’ highest-in-the-nation property tax rates by significantly raising income eligibility thresholds for the Low-Income Senior Citizens Assessment Freeze Homestead Exemption over the next several years.

Under the current law, seniors qualify for the assessment freeze only if their household income does not exceed $65,000. SB 642 increases that maximum income limitation substantially:​​

• Tax year 2026: $75,000
• Tax year 2027: $77,000
• Tax years 2028 and thereafter: $79,000

The same income threshold increases apply to the Senior Citizens Real Estate Tax Deferral Program, which allows qualifying seniors to defer payment of up to $7,500 in annual property taxes.

The Low-Income Senior Citizens Assessment Freeze Homestead Exemption does not freeze property tax bills themselves, but rather locks in the equalized assessed value of a qualifying senior’s home at a base year amount. This prevents increases in the home’s assessed value due to market appreciation, though tax bills can still rise if local tax rates increase.​​

The exemption provides cumulative savings over time as property values continue to rise while the senior’s assessment remains frozen at the base year level.

Beyond expanding senior eligibility, SB 642 grants counties new administrative flexibility to help taxpayers manage delinquent property taxes:​

• For tax year 2025, unpaid first-installment taxes will be deemed delinquent after April 1, 2026, and will accrue interest at a reduced rate of 0.75% per month rather than the standard 1.5%
• County clerks may create and administer payment plans for tax certificates held by the county, with authority to waive interest penalties when taxpayers comply with payment plan terms​​

These provisions are designed to provide additional time and flexibility for homeowners, particularly seniors, who may face unexpected financial hardship.

The legislation also extends the completion dates for Tax Increment Financing (TIF) redevelopment districts in several Illinois municipalities. These extensions allow local governments additional time to complete redevelopment projects and retire bonds issued to finance those projects.