IL HB1238

Creates a new "Residential Affordability in Flood Threatened Areas" homestead exemption providing a $5,000 reduction in equalized assessed value for properties located within FEMA-designated special flood hazard areas, beginning in taxable year 2026

Excludes properties where the primary residence was constructed on or after the date the property was first included in the special flood hazard area

Limits eligibility to households with income at or below 120% of the area median income as defined by the U.S. Department of Housing and Urban Development

Requires property owners to submit an annual application to the chief county assessment officer by July 1 (or an alternative date set by county resolution)

No state reimbursement is required to local governments for implementing this exemption