Do the Math Before You Vote in the Illinois Primary

Kelly A. Anderson and Gabriel Kokoszka • February 27, 2024

Understanding the Referendum: “Amending the Real Estate Transfer Tax”

A city skyline with a river in the foreground and mathematical equations in the background.


Chicago residents participating in the March 19th primary will walk into the voting booths expecting to make consequential decisions about their nominees for President and States Attorney. But, the typical voter may find themselves slightly confused and overwhelmed when they reach a lengthy referendum at the end of their ballot, entitled “Amending the Real Estate Transfer Tax.” This referendum is four entire paragraphs of tax jargon and financial chatter, informing the reader about a ballot measure on a local tax change. 


In fact, this is a highly consequential ballot referendum on a proposed change to the local real estate transfer tax, and it’s essential to understand what the referendum means before primary day. Read on, and we’ll break it down for you. 


Flat Tax No More: Changes to Chicago Real Estate Transfer Tax


The current real estate transfer tax rate in Chicago is 0.75 percent of the sales price of the subject property, regardless of what the price is. This means that no matter what type of property you sell in the city of Chicago, big or small, the city takes a 0.75 percent slice of the total sale price. 


This proposed ballot referendum would change that. If passed, the transfer tax on properties sold for more than $1 million would increase from 0.75 percent to 2 percent, more than doubling the existing rate, but would only apply to the amount of the sale greater than $1 million. Basically, every dollar over $1 million would be taxed at that higher rate. 


In addition, properties sold for more than $1.5 million would be taxed at an increased rate of 3 percent, with the increase, once again, only applying to every dollar in the sale price over $1.5 million.


And finally, the transfer tax on properties sold for less than $1 million, would receive a tax decrease from that original rate of 0.75 percent to 0.60 percent.


The referendum requires that the increased revenue generated from the tax must “be used for the purpose of addressing homelessness, including providing permanent affordable housing and the services necessary to obtain and maintain permanent housing.” 


Critics have attacked the city’s lack of specifics for how the funds must be used, and insist that while many properties that sell for less than $1 million will receive a tax cut, the tax increases on the sales above $1 million will chill commercial investment in Chicago at a time when downtown is struggling with post-pandemic work culture, and this could also result in residential and commercial renters seeing increased transfer tax costs passed on to them by landlords.


Meanwhile, proponents of the referendum insist that the above arguments amount to fearmongering over a relatively minor tax change, and emphasize Chicagoan’s shared interests in not seeing homelessness go unabated—both from a standpoint of human compassion and due to the blight and decreased livability that cities can experience if homelessness is not addressed.


Possibly a Moot Point?


At this time, interestingly, the ballot referendum has been declared invalid and will not be counted in response to a February 23rd ruling from a Cook County judge, who decided in part that the ballot measure was an illegal, textbook example of “logrolling,” or putting politically-unpopular proposals with popular ones on a ballot, and asking voters or legislators to decide on them in a single vote. In this case, the ballot referendum frames the single proposal as both a tax cut for some, and two types of tax increases for others, amounting to three separate tax decisions at once.


So, although the question will remain physically on the ballot, the results will not be tallied and reported unless the judge’s decision is overturned on appeal. However, an appellate court decision could make this ballot measure binding again in the blink of an eye. And even if the ballot language remains stricken, proponents of the tax change will likely rephrase the referendum and work to get it on the next citywide ballot. If you rent, own, or are looking to own property in the city of Chicago, this referendum could ultimately impact you, and you should walk into the voting booth with a clear understanding of that impact.


For questions about this and other real estate tax issues or any legal needs, Lavelle Law offers free consultations. Please contact Attorney Kelly Anderson at (847) 241-1786 or kanderson@lavellelaw.com and we can set up your appointment!


More News & Resources

Lavelle Law News and Events

The Junk Fee Ban Act and pricing transparency legislation.
By Sarah J. Reusché and Jacob Rotolo April 23, 2025
If enacted, the Junk Fee Ban Act would protect consumers from hidden fees and promote fair business practices in Illinois. While there has yet to be legislation in the proposed Junk Fee Ban Act that excludes dealerships, it will be important to look for future updates on this bill, as Illinois is quickly becoming a hub for vehicle innovation and automotive plant expansion.
Ancillary probate is required when a person dies owning real estate outside of their home state.
By Heather A. McCollum April 21, 2025
When someone passes away owning property in another state, their estate may need to go through ancillary probate—a secondary court process in that state.
$9.9 Million Dollar Purchase of Packaged Multi-Unit Properties
By Commercial Real Estate April 18, 2025
Lavelle Law represented a joint venture in its $9.9 million acquisition of four multi-unit buildings.
Type F Reorg offers a means of achieving structural change while preserving tax continuity
By Steven A. Migala and Nathan P. Toy April 14, 2025
A Type F reorganization (“F Reorg”), governed by Section 368(a)(1)(F) of the Internal Revenue Code, provides a strategically significant mechanism for corporate restructuring. Defined as a “mere change in identity, form, or place of organization of one corporation,” an F Reorg permits a corporation to alter its legal existence while being treated for federal tax purposes as the same entity. This recharacterization allows for the uninterrupted preservation of tax attributes while maintaining shareholder continuity.
Estate Planning for Your Pet: Securing Your Pet’s Future with a Pet Trust
By Jackie R. Luthringshausen April 10, 2025
When it comes to estate planning, most people think about providing for their loved ones—but what about the furry, feathered, or scaled members of your family? In the United States, 68% of households own at least one pet, according to the American Pet Products Association’s 2023-2024 National Pet Owners Survey. For many, pets are more than just companions—they’re family. Ensuring their care after your death or incapacity is a vital part of comprehensive estate planning. In Illinois, a Pet Trust offers a powerful solution to guarantee your pet’s well-being long after you’re gone.
IRS Press Release Addresses Payment Plan Options
By Timothy M. Hughes April 10, 2025
IRS Press Release Addresses Payment Plan Options - A recent press release by the IRS addressed the options that are available to taxpayers who may owe more on April 15th than they can pay. The IRS advised taxpayers that they do not need to wait until April 15 to file their 2024 federal return, and if they owe and are unable to pay the balance in full, there are payment plans available to help them pay their tax obligation.
Learn about essential legal protections to strengthen your business and safeguard your interests.
By Lavelle Law April 9, 2025
Join us on May 21 in Schaumburg for an engaging Breakfast Briefs seminar, delving into vital strategies to fortify your business. This session will explore the critical role of crafting ironclad non-compete agreements, shielding your trade secrets, and mastering the nuances of temporary restraining orders (TROs) and injunctive relief. Our presenters, attorneys Matthew Sheahin and Jennifer Tee, bring a wealth of experience in this legal domain. Seize this chance to bolster your company’s legal protections and lay a solid groundwork for enduring success!
FinCEN Eliminates BOI Reporting Obligations!
By Frank P. Portera March 25, 2025
On March 21, 2025, the Financial Crimes Enforcement Network (FinCEN) issued its interim final rule stating that those entities previously classified as "domestic reporting companies" are now exempt from all BOI reporting requirements. On the other hand, all foreign entities registered to do business in the USA must file their own initial BOI reports within 30 days of the initial final rule's publication, if they have not done so already.
Join us April 3, 2025 for Business After Hours 5-7 PM
By Lavelle Law March 19, 2025
Spring is here, and with baseball season kicking off, we’re stepping up to the plate with our annual Lavelle Law Business After Hours event. We’re excited to partner with our friends in the Schaumburg business community for an evening of networking, good vibes, and a few surprises—all hosted in the friendly confines of our Schaumburg office. Bonus points: Feel free to rock your favorite baseball team’s gear and show off your fandom while you’re at it!
Delaware Court  Provides the Standard of Supreme Review for the Redomestication of Corporations
By Steven A. Migala and Anthony Letto March 12, 2025
Delaware corporations seeking to redomesticate to another state should be advised that on February 4, 2025, the Delaware Supreme Court issued its highly anticipated decision in Palkon v. Maffei, C.A. No. 2023-0449-JTL, addressing a challenge to TripAdvisor's redomestication from a Delaware corporation to a Nevada corporation. The case raised important questions regarding the standard of review applicable to such reincorporations, particularly when fiduciaries may derive a benefit from shifting to a legal regime perceived as more friendly.
More Posts