Integrity Investments of Chicago is suing the treasurers and clerks of over 61 counties including Clay and White in Illinois over the manner in which delinquent property tax sales are conducted. The company has filed suit in the US District Court for the Northern District of Illinois.
The dispute centers around a landmark US Supreme Court ruling that states when the government takes property to settle a tax debt, it cannot retain more than the amount of the tax owed. This means it cannot keep the equity in the property. “A taxpayer must render unto Caesar what is Caesar’s, but no more,” Chief Justice John Roberts wrote in the decisive 2023 ruling. Notably, Illinois remains the only state in the United States that has failed to amend its laws following this Supreme Court decision, even two years later.
Under state law, assets are supposed to be auctioned off to recover unpaid taxes. However, instead of counties collecting the taxes directly, they often sell tax liens to third-party investors, such as Integrity Investments. Once an investor owns a lien, they can foreclose on the property and sell it to recover the delinquent taxes. The issue arises because investors are not just collecting what is owed; they are also entitled to retain any equity the property owner has accumulated.
Integrity Investments is challenging the Supreme Court’s interpretation, specifically contesting the requirement that they must pay the delinquent taxpayer any equity that exceeds the tax obligation.
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