A home is often one of the most valuable assets a family owns. It can also become one more bill that gets missed during a divorce, death, illness or other major life change.
Illinois changed its property tax sale law on July 10, 2026. Public Act 104-0553 gives many property owners more time to pay delinquent taxes and adds protections for the equity remaining in a property if it is eventually sold.
The law does not erase unpaid taxes or eliminate tax sales. Property owners can still lose their property if they miss the redemption deadline.
What Changed Under Illinois’ New Property Tax Law?
The new law makes three major changes:
- The standard redemption period increases from two and a half years to three years for tax certificates issued on or after July 10, 2026.
- Property that is not redeemed may go through a public tax deed auction.
- Money remaining, after taxes, interest and permitted costs are paid, may be claimed by the former owner or another lawful claimant.
The law also creates a surplus equity fund that may help certain owners who recently lost property through a tax deed.
These changes follow the United States Supreme Court’s decision in Tyler v. Hennepin County. The Court ruled that the government may collect what it is owed, but it cannot keep the owner’s remaining equity without compensation.
How Do Unpaid Property Taxes Affect a Divorce in Illinois?
During a divorce, each spouse may believe the other person is paying the property taxes. One spouse may live in the home while the other pays the mortgage, or the taxes may not be included in the mortgage payment at all. However, the county’s deadlines continue.
Even if a divorce order says one spouse must pay the taxes, the property may still be at risk if the payment is not made. Delinquent taxes can reduce the home’s equity, interfere with a sale or refinance and affect how the property is divided.
Problems can also arise after a divorce. If one former spouse was awarded the home but never refinanced or transferred the title, the other person may still be affected when taxes go unpaid.
Before making decisions about the marital home, both spouses should confirm that the property taxes are current and determine whether the property has already been included in a tax sale.
What Happens to Unpaid Property Taxes After Someone Dies or Becomes Incapacitated?
After someone dies, tax bills may continue going to the property. Family members may not know who is responsible for paying them, especially when ownership has not yet been transferred or more than one person inherits the home.
Similar problems can happen when someone becomes ill, moves into senior living, or can no longer manage personal finances. An agent under a Power of Attorney, guardian or trusted family member should confirm that the property taxes are current and check for tax sale notices.
This is particularly important when a home becomes vacant because certain vacant properties may have a redemption period of only one year.
Can Someone Who Already Lost a Property Recover Money?
Possibly. The new surplus equity fund may apply to certain tax deeds recorded during the two years before July 10, 2026. It may also apply when a tax certificate was issued before that date, but the tax deed was recorded afterward.
Compensation is not automatic as eligibility depends on the dates involved, the property’s value, unpaid taxes, mortgages, liens, and other costs.
Legal challenges involving Illinois’ previous tax sale process are also pending and may affect how parts of the new law are interpreted or implemented.
What Should You Do If Property Taxes Are Behind?
Much like we’ve said before in regard to other topics, it is important to not assume someone else is handling the problem.
You may want to contact the county clerk and request:
- The official redemption deadline
- The current amount required to redeem the property
- The date of the tax sale
- Information about any tax certificate or tax deed
Don’t forget to gather any divorce orders, deeds, mortgages, estate documents or Powers of Attorney connected to the property.
If a tax deed has already been issued or the redemption deadline is approaching, you should consider consulting with an Illinois attorney who handles property tax sales.
Frequently Asked Questions
Did Illinois eliminate property tax sales?
No. Property owners may still lose property if the taxes are not paid. The law changes the timeline and provides additional protection for remaining equity.
Does everyone now have three years to redeem?
No. The three-year period applies to many tax certificates issued on or after July 10, 2026. Certain vacant, commercial, industrial, and larger residential properties may have a shorter deadline.
Will former owners automatically receive surplus money?
No. A claim may need to be filed, and eligibility depends on the property, dates, debts and other facts.
Can a divorce court stop the property tax deadline?
A family court may decide which spouse is responsible for paying the taxes, but the county’s tax sale deadlines continue unless the taxes are paid, or the matter is otherwise resolved.
Property Taxes Should Not Be an Afterthought
During a divorce, death or family crisis, property taxes may feel like one more item on an already impossible, never-ending list. However, ignoring the notices can place both the property and its equity at risk.
If unpaid property taxes are affecting a family law, guardianship or estate planning matter, Sterk Family Law Group can help address how the property fits into the larger legal picture and connect clients with additional tax professionals resources when needed.
To schedule a free, no-obligation consultation, call tel:815-600-8950 or complete the form below.
This article is for general informational purposes and is not legal or tax advice. Public Act 104-0553 is new, and its procedures may be affected by county and pending litigation.