Updated September 5, 2026. Quick answer: Illinois’s Senior Citizens Real Estate Tax Deferral caps the amount you can defer at $7,500 a year and 80% of your home equity, charges 3% interest, and its lien statute never says whether it outranks your mortgage.
What Illinois’s deferral requires
Illinois’s Senior Citizens Real Estate Tax Deferral Program, 320 ILCS 30, opens to homeowners 65 by June 1 of the deferral year who have owned and occupied the home at least three years. Household income is capped at $75,000 for tax year 2025, rising to $77,000 for 2026 and $79,000 for 2027 and after; a phased schedule written directly into the statute rather than left to annual adjustment. No more than $7,500 can be deferred in a single year, current as of a 2022 increase from the prior $5,000 cap, and the running total of deferred taxes plus interest cannot exceed 80% of the taxpayer’s equity in the home.
3% interest, and a lien the statute never ranks against your mortgage
Deferred amounts accrue at 3% simple interest a year for tax year 2023 forward, down from 6% for 2022 and earlier; one of the lower rates in this family. A lien is created and recorded against the property, but the Act’s lien section never uses words like senior, junior, prior, or subordinate to describe how it ranks against an existing mortgage. The only nearby provision, a non-preemption clause, simply confirms the deferral program does not override whatever tax-payment covenants are already written into your mortgage; it does not rank the two liens against each other, so Illinois is genuinely silent on the question rather than resolving it either way.
When it comes due, and how to apply
No sale or transfer of the property can legally close and be recorded until the deferred taxes and accrued interest are paid; on the taxpayer’s death, the deferred amount must be recovered from the estate within one year, unless a surviving spouse 55 or older continues the deferral; and the balance falls due within 90 days of the property ceasing to qualify. Applications are filed with the county collector between January 1 and March 1 each year, on state forms IL-1017 and IL-1018.
Illinois’s broader senior property-tax picture, covering exemptions, freezes and circuit-breaker credits, not just the deferral: property tax breaks for seniors in Illinois.
How every state’s programme compares: property tax relief for seniors by state. What a deferral means in general, and who it catches out: the property-tax deferral lien trap.
Statutory text read at each state’s own legislature, revisor, or revenue agency this session. General information, not tax or legal advice; rates, caps and thresholds change most years and a county or state agency retains the final say on your own application.