Illinois Transfer Tax Overview
Illinois is one of the more expensive states for real estate transfer taxes, particularly in Chicago where three layers of taxation — state, county, and city — apply to every sale.
Transfer taxes are one-time taxes imposed when real property is sold or conveyed. They are separate from property taxes (which are annual) and income taxes. They are paid at closing and are typically a seller cost — though contract terms can shift the burden. They are calculated based on the consideration (sale price) and reported on the PTAX-203 form required by the Illinois Department of Revenue.
The Three Layers of Transfer Tax
Layer 1: State of Illinois Transfer Tax
$0.50 per $500Authorized under 35 ILCS 200/31-10 et seq. Applies statewide to all deed recordings. Rate: $0.50 per $500 of consideration (or $1.00 per $1,000). Paid by the seller. On a $400,000 sale: $400. This is the base layer that applies everywhere in Illinois.
Layer 2: Cook County Transfer Tax
$0.25 per $500Cook County imposes an additional transfer tax of $0.25 per $500 of consideration. This applies to all property in Cook County — including Chicago. Paid by the seller. On a $400,000 sale: $200. Properties in DuPage, Lake, Will, Kane, and other counties outside Cook do not pay this county tax.
Layer 3: City of Chicago Transfer Tax
$3.75 per $500The City of Chicago imposes the largest transfer tax layer: $3.75 per $500 of consideration, paid by the seller. On a $400,000 sale: $3,000. For transactions over $1,000,000, the buyer also pays $1.50 per $500 of consideration. This city tax applies only to property within Chicago city limits — not to Cook County suburbs.
| Tax Layer | Rate | Where Applies | On $400k Sale |
|---|---|---|---|
| State of Illinois | $0.50 / $500 | All Illinois counties | $400 |
| Cook County | $0.25 / $500 | Cook County only | $200 |
| City of Chicago | $3.75 / $500 (seller) | Chicago only | $3,000 |
| Total (Chicago seller) | $4.50 / $500 = $9.00 / $1,000 | Chicago | $3,600 |
| Total (Cook County, not Chicago) | $0.75 / $500 = $1.50 / $1,000 | Cook suburbs | $600 |
| Total (other Illinois counties) | $0.50 / $500 = $1.00 / $1,000 | Statewide base | $400 |
Who Pays Transfer Tax in Illinois?
By statute, the state and Cook County transfer taxes are the seller's obligation. The Chicago city transfer tax is also primarily a seller obligation for transactions under $1,000,000. However, contract terms control who actually bears the economic burden at closing — buyers and sellers can agree to any allocation.
Practice Note for Buyers
Even though transfer taxes are primarily a seller cost, buyers should understand them because they affect the seller's net proceeds and therefore the seller's flexibility on price. A seller netting $396,400 (after $3,600 in Chicago transfer taxes on a $400,000 sale) has different economics than a seller in DuPage County who nets $399,600. This affects negotiating dynamics in cross-county comparisons.
The PTAX-203 Form
Every deed recorded in Illinois must be accompanied by a completed PTAX-203 Real Estate Transfer Declaration. This form:
- Reports the nature of the transfer (sale, gift, divorce, etc.) to the Illinois Department of Revenue
- States the amount of consideration (purchase price)
- Identifies any applicable exemption from transfer tax
- Is required even if the transfer is fully exempt — the form is filed with an exemption code
- Must be signed by the grantor (seller) or their authorized representative
- Is submitted to the county recorder along with the deed and transfer tax stamps
Your attorney prepares the PTAX-203 as part of the closing process. The form is then submitted to the county recorder's office, which forwards the data to the Illinois Department of Revenue for tax collection and property assessment purposes.
Transfer Tax Exemptions
Illinois law provides numerous exemptions from transfer tax under 35 ILCS 200/31-45. Common exemptions include:
Even Exempt Transfers Require PTAX-203
Claiming a transfer tax exemption does not mean you skip the PTAX-203. The form is always required — you simply mark the applicable exemption code. Failure to file PTAX-203 will result in the county recorder rejecting the deed.
Transfer Tax Calculator by County
Enter your sale price and location to calculate the seller's transfer tax obligation:
This estimate is for planning purposes. Always verify current rates with your closing attorney. Some municipalities may impose additional local transfer taxes — consult your attorney.
Frequently Asked Questions
Selling in Illinois? Know Your Transfer Tax Costs.
Illinois Estate Law handles PTAX-203 preparation and all transfer tax compliance for sellers throughout Cook County and Chicago. We ensure your transfer tax obligations are correctly calculated and reported at closing.
You Might Also Like
What Illinois Home Sellers Need to Know About the Attorney Review Process
What Illinois home sellers need to know about the attorney review period — protecting your interests, responding to buyer modifications, and disclosure requirements.
Read MoreHow to Sell a House During Probate in Illinois
Learn how to sell a house during Illinois probate, including executor authority, the court approval process, and how to close efficiently while protecting the estate.
Read MoreHow to Hold Title to Your Home in Illinois: Joint Tenancy, Trust, or Sole Ownership?
Compare all four ways to hold title to your Illinois home and understand the probate, tax, and estate planning consequences of each choice.
Read More