In 1967, Felicitas Obregón, together with her husband, Jesse, and her year-old son, Álvaro, moved into an apartment in Chicago’s Pilsen neighborhood, launching their life there. Three years later, Jesse was dead, leaving Felicitas to support and raise her young son alone.
More than a half century later, Felicitas, 90, still lives in that same three-story, three-apartment building — a redbrick structure with a big front yard. She’s not a tenant, however; she’s the owner.
Her story is an inspiring tale of hard work, thrift and determination. But it wouldn’t be complete or accurate if it didn’t include an oddly uplifting chapter on something far more impersonal: property taxes.
Relief from property taxes, available in most states to people 65 and older, has allowed Obregón to hold on to her home long after retiring. Her experience, in turn, inspired Álvaro, now 55, to help others in their community lower their property taxes, including using a process available to almost every homeowner in America: challenging the valuations of their homes.
Property taxes are one of the only forms of government levy that most Americans have a real chance to argue down. Felicitas’ and Álvaro’s efforts provide lessons for older American homeowners or homeowners-to-be about their power to bring their property taxes under control.
The journey to ownership
As a single mother, Felicitas held various jobs at a leather-goods factory. Along with supporting herself and Álvaro and sending money to her family in Mexico, she set aside cash in the hopes of buying a home. “I wanted to have my own house, big or small,” she says. “I was a widow, and I didn’t want to move from one place to another.” When, after 19 years at the leather factory, her employer asked her to take a pay cut, she quit. She spent the next 20 years — until retiring at age 72 — commuting an hour by bus each way to a printing plant where she inspected paint-sample cards. “My mom had a really sharp eye,” Álvaro says. “She could catch all kinds of little defects.”
In 1997, when Felicitas was 65, her dream of homeownership came true. Her uncle, from whom she’d been renting her apartment, sold her the three-unit building. “When I look at it, I see her life’s work,” her son says. “This building means so much to her because it’s the place where my dad brought us, and it was her first real home away from home.”
That’s where the property tax breaks come in. When Felicitas retired, her only income was Social Security and the rent money she collected — not enough to cover living expenses, building maintenance and property taxes. But because of her age, she was able to benefit from two property tax relief programs available where she lives: a senior exemption, which reduces property taxes for people 65 and older, and a senior freeze exemption, which locks in the equalized assessed value of a property for people 65 and older whose income falls below a certain level (currently $65,000).
As a result, Felicitas’ property tax bill is at least $3,000 per year less than what she’d pay without the breaks, Álvaro estimates.
Those annual savings appear likely to increase. Pilsen was a working-class neighborhood when the Obregóns moved in, though since then, property values have exploded. In 2018, a Forbes columnist dubbed the area one of the “12 Coolest Neighborhoods Around the World.” A million-dollar condo building is being built next door, and condos and small houses in the neighborhood today are mostly priced around $300,000 or more. “Despite 40 years of factory work, my mother has no pension, and she would not be able to afford where she lives,” Álvaro explains. Having the senior exemption and the freeze “have helped me tremendously,” Felicitas says. “They have allowed me to save money for other expenses, such as my medicine, doctor appointments and other essentials.”
Learning the ropes
Most states give property tax breaks to homeowners 65 and older through programs that could save them hundreds of dollars a year. But many of these breaks are underused, observes Adam Langley, an associate director of the Lincoln Institute of Land Policy and coauthor of a recent report about property tax relief. “There are a lot of seniors unaware of these programs or who miss application deadlines.”
According to Álvaro, this is true in his community, especially among people for whom English is a second language. The results can be catastrophic. “The fact that some people lose what they’ve worked for their whole lives because they can’t afford it and they didn’t fill out the exemption forms — it breaks my heart,” he says. (Keeping Felicitas’ senior freeze in effect requires filing an income-disclosure form annually.) As the director of constituent services for a Cook County, Illinois, commissioner, starting in 2010, Álvaro worked to help people learn about these and other benefits that might be difficult to find. “I treated everybody who came into our office as if they were my mother, because I knew what that struggle was like,” he says. That work continued when, in 2016, he joined AARP Illinois as an associate state director, focusing on advocacy and outreach. “I didn’t realize until I was working at the county just how easy it is” to get property tax breaks, he says. “But anybody can forget to fill out the renewal notice, especially older adults who get a lot of junk mail.”
How to fight back
Using these senior exemption programs isn’t the only way to lower your property taxes, Álvaro explains. You don’t have to wait until you’re 65 to take advantage of another way. The heart of that strategy is to challenge the assessed value of your home, which your county or city determines on a regular basis — usually every year or so. If your assessment seems too high, you usually have a clear-cut procedure for appealing.
In Cook County, this is the routine (check with your local city or county assessor’s office or treasurer’s office to see how yours compares): Properties are reassessed every three years; you have a 30-day window that year (and in the off years, too) in which to file an appeal. Before and during that period, “lawyers send you tons of mail offering to fight the assessment on your behalf, and they take a percentage of the savings,” Álvaro says. “In most cases, you don’t need a lawyer to help you, especially at the first level.”
To start the process, you typically log in to the website of the assessor’s office and examine your property’s listing for any mistakes, such as inaccurate square footage or number of bedrooms. To correct any inaccuracies, you can upload evidence, such as an appraisal. “Any documentation describing the property will be helpful,” notes Scott Smith, a spokesperson for the Cook County assessor’s office. If you’re appealing based on a recent purchase price, you can upload your closing documents. If you think your home is valued too high relative to similar properties, you can search online, using various filters, for properties you think are comparable. You can include up to six comps — recently sold comparable properties — in your appeal. (Other areas might not have such tools available; in that situation you’d have to search for comps yourself or get them from a local real estate agent.)
If you lose the first round, you can appeal online to a board of review, which you can also do by yourself. (You can also request a hearing if it’s difficult to explain your case or present evidence otherwise.) “I’ve seen many cases where the assessor denies an appeal, but then the property owner appeals at the board of review and will get it,” Álvaro says.
If you lose that appeal, you have one more chance — you can go to Cook County court or to the Illinois Property Tax Appeal Board. “That’s where you really might need a lawyer,” Álvaro adds.
While time frames and steps to appeal vary throughout the country, you can typically get help from the assessor’s office or your local elected officials, he says. Nonprofits, such as the AARP Foundation Property Tax-Aide program, may also offer help in your area. “Every state has a different way in which they tax, so it’s important to find out how that works,” Álvaro advises.
In addition, whenever you get a chance to lower your property taxes, tell your friends. At a regular older-adults get-together at a nearby park, he says, Felicitas would talk about property relief programs, just like she’d share information about local goings-on. “People should be taking advantage of these programs. That’s what they were set up for,” Álvaro emphasizes. “Spread the word.”
Kimberly Lankford, a longtime columnist at Kiplinger’s Personal Finance, is the author of Rescue Your Financial Life.