Illinois lawmakers are trying to make it tougher for property owners to leave retail spaces vacant and write the losses off of their taxes. It’s common to see empty storefronts on busy streets in popular neighborhoods, as collecting on tax breaks offered to property owners is often times viewed as an easier solution than actually renting out the property. Sometimes these storefronts can remain vacant for several years, despite new businesses opening up all around them. Some lawmakers and neighborhood groups say that this practice contributes to blight and hampers the economic growth of neighborhoods.
Earlier this year, State Representative Rob Martwick (19th District) introduced a bill to the Illinois House that could help counties to identify landlords that are fraudulently utilizing tax breaks and introduce penalties to those who are found guilty of this practice. The bill would be aimed at landlords who have received vacancy relief for at least two years. A formal “Notice of Intent to File a Vacancy Fraud Complaint” identifying the property, the landlord and other details would have to be filed, and if the complaint provides enough evidence that rules have been broken, the landlord will be investigated by the County Board of Review. The bill was discussed at a hearing in Springfield last week, and although no formal action was taken, it remains on the table.
If passed, the new bill would allow counties to fine property owners three times the amount of back taxes owed. The penalty could be staggering for landlords who have been found to have fraudulently utilized vacancy relief for several years. However, State Rep. Martwick tells DNAinfo that the bill is not a money grab, “It is designed to discourage landlords from just letting these properties sit vacant. We want to make it not worth it to be an absentee landlord.”
- Full Text of HB4363 [Illinois General Assembly]
- 'Vacancy Fraud' Allowing Tax Breaks for Empty Storefronts Under Fire [DNAinfo]