Changing who benefits from an Addison property can trigger taxes even if the deed never changes hands. If you are selling, buying, or moving interests inside a land trust or entity, you want to know what the Village, County, and State require so you do not hit last‑minute delays. In this guide, you will learn what a “beneficial interest” is, how Addison’s transfer tax works, who typically pays, and how to prepare for a smooth closing. Let’s dive in.
Beneficial interest explained
A beneficial interest is the right to receive the economic benefits of real property, even when legal title sits with a trustee or entity. Common examples include:
- Assignment of a beneficiary’s interest in a land trust, which Illinois treats as a taxable transfer of beneficial interest. See the Land Trust Recordation and Transfer Tax Act for definitions and examples (Illinois Land Trust Act).
- Assignment of a long‑term ground lease of 30 years or more, including renewal options, which the Illinois Department of Revenue states is taxable (IDOR guidance on RETT).
- Transfer of a controlling interest in a real estate entity. Shifting control can be a taxable transfer under Illinois law (controlling interest reference).
The takeaway: if control or the right to profits from Addison real estate moves to someone else, taxes and local stamps may apply even without a deed.
Addison transfer tax basics
Addison transfers typically layer three charges: State, DuPage County, and Village of Addison.
- State of Illinois: 50 cents per $500 of value, which equals $1.00 per $1,000 (0.1%) (Illinois statute and rate).
- DuPage County: 25 cents per $500, which equals $0.50 per $1,000 (0.05%), collected through the recorder’s office (DuPage legislative reference).
- Village of Addison: $2.50 per $1,000 (0.25%), typically rounded to the nearest $1,000, with local prerequisites to issue the municipal stamp (Addison municipal summary).
Together, these often total about 0.40% of the transfer price for a straightforward sale in Addison. Always verify current rates, rounding, and any processing fees with your title company and the Village before closing.
Who typically pays in Addison
Published municipal summaries list the buyer as the party who purchases the Addison municipal stamp. Your purchase contract can allocate costs differently, so confirm who will pay with your agent and title team (Addison municipal summary).
How to calculate your tax
Here is an illustrative example for a $300,000 Addison home sale:
- State tax: $1.00 per $1,000 → $300,000 × $1/1,000 = $300.00 (Illinois statute and rate).
- DuPage County: $0.50 per $1,000 → $300,000 × $0.50/1,000 = $150.00 (DuPage legislative reference).
- Village of Addison: $2.50 per $1,000 → $300,000 × $2.50/1,000 = $750.00 (Addison municipal summary).
Total estimated transfer taxes and stamps: $1,200.00. Local rounding rules and any fees can affect the final number, so confirm with your title company.
If there is an existing mortgage
If the transfer document states the property is conveyed subject to an outstanding mortgage, Illinois excludes that mortgage balance from the state tax basis. County and municipal practices often follow suit, but you should confirm locally (Illinois statute and rate).
Step‑by‑step stamp checklist
Use this simple process to stay on track in Addison:
- Ask your title company if a municipal stamp is required and who pays it. Confirm timing and any appointments needed at Village Hall (Addison municipal summary).
- Complete the Illinois Real Estate Transfer Declaration (Form PTAX‑203) and provide a copy for the county and the Village (PTAX‑203 instructions).
- Clear local prerequisites: pay the final water bill, schedule and pass any required sewer or sump inspections, and resolve open permits as required by Addison (Addison municipal summary).
- Purchase the municipal stamp at Village Hall and ensure the state/county revenue stamps are secured through recorder procedures, often handled by your title company.
- If claiming an exemption, submit the required exemption paperwork and any supporting documents. Expect a processing fee for an exempt stamp in some cases (PTAX‑203 instructions).
Exemptions and special cases
Illinois law lists exemptions such as certain governmental transfers, qualified charitable transfers, and transfers for nominal consideration under $100. The PTAX instructions outline documentation you must provide to claim an exemption (exemption list, 35 ILCS 200/31‑45 and PTAX‑203 instructions).
Transfers of controlling interests in entities can have special credit rules, including a potential exemption equal to corporate franchise taxes paid in certain cases. Complex entity or trust transactions should involve your title professional and a real estate attorney to confirm taxability and filings (franchise tax offset reference).
Common pitfalls and penalties
Addison will not issue a municipal stamp if local requirements are not met. Unpaid final water bills, missing sewer or sump inspections, or unresolved permits can delay closing. Municipal summaries report penalties for non‑compliance such as monthly interest and additional fines. Title companies typically verify stamps before recording to avoid rejection and penalties (Addison municipal summary).
Pro tips for Addison closings
- Start early on municipal prerequisites so inspections and final bills do not jam your closing week.
- Confirm who pays each transfer tax in your contract and closing statement.
- If you are assigning a land trust interest or a ground lease, treat it with the same care as a deeded sale. Taxes and stamps may still apply.
- Keep a clean paper trail: PTAX‑203, unexecuted deed or assignment documents, inspection receipts, and paid utility confirmations.
Ready to move forward with confidence in Addison? Reach out to the veteran‑led team at The Jerry Cox Group for clear guidance, steady advocacy, and a smooth path to closing.
FAQs
What is a beneficial interest in Illinois real estate?
- It is the right to receive the benefits of a property held by a trustee or entity, such as a land trust interest, a long‑term ground lease assignment, or a controlling interest in an ownership entity.
What is the Addison transfer tax rate and who pays it?
- Published summaries show $2.50 per $1,000 for the Village municipal stamp, typically paid by the buyer, in addition to State and DuPage County stamps. Always confirm in your contract and with the title company.
How much tax on a $300,000 Addison home?
- Using published rates, the estimated total is $1,200. That includes $300 State, $150 County, and $750 Village, subject to rounding and any local fees.
Do assignments of land trust interests in Addison require stamps?
- Assignments of beneficial interests in land trusts can be taxable transfers under Illinois law. You should expect to address state/county stamps and Addison’s municipal stamp requirements.
What documents does Addison need to issue a stamp?
- Typical requests include a copy of the PTAX‑203, an unexecuted deed or assignment, proof the final water bill is paid, required sewer or sump inspections, and any needed permit releases, plus payment for the stamp or exempt‑stamp processing fee.
