Homestead deductions purge recovers $1.3 million in old taxes

2013-02-26T18:32:00Z 2013-02-26T21:21:04Z Homestead deductions purge recovers $1.3 million in old taxesBy Bill Dolan bill.dolan@nwi.com, (219) 662-5328 nwitimes.com
February 26, 2013 6:32 pm  • 

CROWN POINT | Lake County has squeezed at least $1.3 million from hundreds of residents who took homestead deductions they didn't deserve.

County officials are giving another 10,000 homeowners one more chance to prove they deserve their tax breaks before they lose it and begin paying higher taxes this year.

Lake is part of a statewide push to lighten the burden on law-abiding taxpayers by purging the tax rolls of ineligible homestead deductions, the most common, but frequently abused tax break since it lowers an individual's taxes by hundreds if not thousands of dollars.

State law permits a property owner to claim only one such deduction on their primary residence.

However, Hobart attorney David N. Gilyan, working for months as a consultant for the Lake County auditor, said he and a staff of three full-time assistants have already identified 330 persons now repaying $1.3 million in back taxes. He said he is pursuing thousands more this year.

He said some of the ineligible deductions appear to be honest mistakes involving the purchase of former homes later turned into rental properties. Some were families living in Illinois and maintaining a second home on the lakeshore.

He said one woman had hoped to dodge liability by pretending on the phone to be her mother, only to be unmasked when he recited the dead mother's obituary.

"We go through a lengthy search process with mass databases to carefully narrow it down to the point where we tell people they owe money. I get people who are very gracious, and some people do a lot of hollering and yelling.

"You have a right to appeal and if you lose your appeal, the back amount is put on your next tax bill and if you don't pay that, then it goes on the tax sale," Gilyan said.

The county is also sending out a final wave of pink forms requiring owners to provide their name, address, Social Security number, driver's license or state-issued identification card number, passport or work visa and sign the form, certifying they are eligible for their homestead credit.

The pink survey sheet has been sent out the last three years and resulted in tens of thousands of homestead credits being removed as ineligible, but a remaining 10,000 owners have either failed to respond or left their earlier form incomplete.

Those who fill it out and return it to the auditor's office can avoid losing their deduction before the May tax bills.

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