Non-Profit Property Tax Exemption

What’s new?

  • On September 20, 2018 the Illinois Supreme Court unanimously upheld the constitutionality of the state’s hospital property tax exemption law.
  • The ruling, Oswald v. Beard, 2018 IL 122203 (9-20-18), caps many years of effort to enact and then defend a clear and fair test for property tax exemption for non-profit hospitals.
  • The original lawsuit was filed in 2012, just months after the state enacted a new hospital property tax exemption Public Act 97-688 that established clear and fair standards for non-profit hospitals and health systems.
  • The Illinois Health and Hospital Association (IHA) was a party in the Oswald case and worked with Illinois Department of Revenue and the Illinois Attorney General’s Office in defending the constitutionality of the statute.  For a complete legal history, please reference IHA’s summary here.

What’s the issue?

  • As a non-profit organization, AMITA Health currently is exempt from paying local property taxes.
  • Illinois uses the property tax exemption to encourage and enable non-profit organizations to spend and invest more on giving back to their communities, and in recognition that non-profit organizations are providing a public service.
  • Non-profit healthcare organizations benefitting from the exemption have to report to the Illinois Attorney General every year the dollar amount of community benefit they provide in order to continue to be designated as a non-profit organization.
  • If the total community benefit reported is greater than what a non-profit would have had to pay in property taxes, then the non-profit will be exempt from paying property taxes for that year.
  • If total community benefit reported is less than what a non-profit would have had to pay in property taxes, local jurisdictions may request the organization begin paying the property taxes they are owed.


Why does it matter?

  • The issue of tax exemption for non-profit hospitals continues to receive scrutiny in Chicago and nationwide.
  • The property tax exemption specifically allows AMITA Health to provide greater amounts of community health benefit across the system through caring for patients who cannot pay, and supporting initiatives and organizations working to make our communities healthier.
  • AMITA Health provided nearly $179 million in community benefit in Cook County alone in 2018, far exceeding the amount that AMITA Health would have paid in taxes of $30cto $50 million per year.
  • AMITA Health will always continue to accept patients regardless of their ability to pay, but our mission to provide compassionate and exceptional care extends beyond our doors. Any additional tax burden would negatively impact AMITA Health’s ability to provide holistic care in a highly personalized environment to all those we are privileged to serve.
  • To help you better understand what community benefit looks like across the system, and dive deeper into the topic of community benefit click here.

What is the AMITA Health perspective?

  • Protect tax exempt status for hospitals. Keeping in place the current law would allow AMITA Health ministries to continue to provide the service and community benefit to vulnerable populations across the state rely on.

Featured News

Featured news includes articles from multiple viewpoints and is designed to keep you abreast of the current debate. This information should not be construed as our point of view.

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State Supreme Court upholds law allowing hospital property-tax exemptions

The state’s highest court decided Thursday to uphold a law that allows many hospitals to avoid paying property taxes — an issue that’s spurred debate ...

Chicago Tribune + September 20, 2018 + View Article

Supreme Court upholds property tax exemption law for Illinois hospitals

Illinois Supreme Court justices on Thursday unanimously upheld a 2012 state law that established specific and relatively easy-to-meet rules for not-for-profit hospitals to avoid paying property taxes.

State Journal-Register + September 20, 2018 + View Article