Agenda

1. Agenda 1. About Robert H. Rosenfeld & Associates 2. Real Estate Taxes: Why care? 3. How does it work? 4. Assessment Process 5. Appeal Process 6. Payment Process 7. New Construction 8. Tax Prorations 9. Exemptions 10. Resources 11. Q & A Law Offices of Robert H. Rosenfeld & Associates, LLC

2. Robert H. Rosenfeld & Associates, LLC • Focus on Real Estate Tax Law • Decades of experience • Proven track record for ALL types of properties • AVAILABLE throughout the transaction Your Resource: Law Offices of Robert H. Rosenfeld & Associates, LLC

3. Robert H. Rosenfeld & Associates, LLC • Robert H. Rosenfeld & Associates, LLC is Chicagoland's premier law group, concentrating on Real Estate Tax Law, Commercial Litigation, Technology Law and Business Law. Robert H. Rosenfeld & Associates provides a unique blend of legal and business expertise, and delivers these services to its sophisticated clientele efficiently and effectively. Our emphasis is on successful results for our clients, and we have been achieving our goal since 1985. • Robert H. Rosenfeld is an experienced attorney, award-winning entrepreneur, business owner and investor. Mr. Rosenfeld has more than 25 years of experience in law and business, and with this diverse background brings a unique and multi-disciplinary approach to solving his client's legal matters. Rosenfeld has built a mix of successful operations, including a number of boutique commercial law firms, a national reseller of hardware, software and services, as well as a venture capital investment and advanced marketing strategies consulting firm. Mr. Rosenfeld has practiced law since graduating from law school in 1985 and was admitted to the Illinois and Northern District of Illinois that year. He attended Northwestern University where he earned a Bachelors of Arts degree in History and graduated from DePaul University College of Law. Mr. Rosenfeld has specialized in complex commercial litigation, business law, class action litigation and real estate taxation. He has handled a wide variety of legal issues regarding technology law, business law, real estate taxation law and complex commercial litigation cases, including class actions. Rosenfeld has published on matters including medical reimbursement to medical providers and Y2K liability for medical offices. Rosenfeld has spoken often of the dynamics of entrepreneurship, including technology start-up opportunities and financing.

4. Real Estate Taxes: Why Care? Differentiate yourself by adding real value. Increase your sales. Taxes can: • Confuse • Scare • Kill the deal Use it to your advantage; provide accurate historical and prospective information

5. How Does it Work? 1. Assessment Process 2. Appeal Process 3. Payment Process

6. Assessment Process STEP ONE: Determination of Assessed Value Assessor assesses residential property at 10% of assessor’s determination of market value. Example: $1,000,000 home = assessed value of $100,000

7. Assessment Process - Continued STEP TWO: Determination of actual tax liability; Apply Equalized Tax Rate 2008 New Trier Township = .1600 (estimated rate) Example: $1M market value = 100,000 assessed value x .16= $16,000 Gross

8. 400 Sheridan RoadWinnetka, ILPIN 05-21-201-006 Current stats: 2008 taxes = $31,818 (after homeowner and senior exemption) 2009 assessed value= $199,469 2009 market value = $1,994,690 2009 taxes = 199,469 x .1600 = $33,511

9. Appeal Process 3 LEVELS 1. Assessor 2. Board of Review 3. Property Tax Appeal Board (PTAB) / Circuit Court

10. Apply it to my world, please! How to analyze tax ramifications of a proposed transaction?

11. What happens if you can establish a market value of $1,500,000 on 400 Sheridan Road? • Taxes are cut to $25,200 from $33,511 for 2009 • $1,500,000 market value = $150,000 assessed value

12. How do you establish market value? 1. Recent sale 2. Competent appraisal 3. Uniformity analysis

13. East of Sheridanfrom Lake Cook Road to Evanston • Unique neighborhood code • Unique issues • Primarily land value • Not immune from market decline

14. School Board InterventionsBEWARE! Notice on all appeals > 100,000 assessed value Increasingly aggressive Can assert undervaluation with resultant tax increase

15. Payment Process One year behind 2 installments First installment is 50% of prior year’s tax.

16. New Construction • Build No recorded purchase price Assessor user cost manual Assessed at substantial completion: ready for occupancy • Purchase Won’t chase sale Assessed at next reassessment date

17. Robert H. Rosenfeld & Associates, LLC Regularly beat the Assessor’s market values, which are based on old sales data Decades of experience Multi-state practice All types of properties

18. Tax Prorations KNOW YOUR FACTS! Ramifications can be severe. Deal Specific Seller- 105%-110% If seller has appeal pending, consider pro rata on taxes and costs Year Specific Call Rob Rosenfeld

19. Exemptions 1. Homestead; occupied as “primary residence“ by January 1 of year in question 2. Senior; 65 yrs old as of January 1 of tax year in question 3. Apply at local assessor’s office at Old Orchard Court House

20. Resources Robert H. Rosenfeld & Associates, LLC 847-677-3500 rhr@rhrassociates.com Cook County Assessor www.cookcountyassessor.com Cook County Treasurer www.cookcountytreasurer.com

21. Q & A

22. Robert H. Rosenfeld & Associates, LLC 6703 N Cicero Ave, Lincolnwood, IL 60712 (847) 677-3500 33 North Dearborn Street, Suite 1030, Chicago, Illinois 60602 (312) 704-2200 rhr@rhrassociates.com