Illinois Landlords Should Prepare for New Fee Disclosure and Limitation Rules

 

Illinois residential landlords may soon face significant new requirements regarding rental fees and lease disclosures under House Bill 3564, which has passed both chambers of the Illinois General Assembly and is currently awaiting Governor Pritzker's signature.

 

According to guidance provided by Goldenberg Heller & Antognoli, P.C., the legislation is expected to become law and would take effect on July 1, 2026. The bill amends the Illinois Landlord and Tenant Act by creating new "Rental Fee Transparency and Limitations" provisions aimed at increasing transparency and eliminating certain fees commonly charged to tenants.

 

New Disclosure Requirements

Under the proposed law, all non-optional fees, whether charged one time or on a recurring basis, must be clearly listed on the first page of the lease agreement. Any fee not disclosed on the first page would be unenforceable against the tenant.

In addition, landlords must disclose all non-optional fees in property advertisements or listings, either directly in the advertisement or through an accompanying web link. Landlords must also indicate whether utilities are included in the rent.

 

Prohibited Fees

HB 3564 would prohibit a number of fees often referred to as "junk fees," including:

• Application or background check fees exceeding $50, subject to limited exceptions for documented third-party costs
• Fees that duplicate tenant screening costs or cover unrelated expenses
• Lease renewal or lease modification fees
• Certain eviction-related fees charged before a court order granting eviction
• After-hours maintenance request fees
• Fees for contacting the owner or property manager regarding maintenance, service requests, or lease questions
• Travel fees associated with maintenance or safety repairs
• Maintenance hotline fees
• Charges for routine unit upkeep
• Pest control fees when the tenant did not contribute to the infestation
• Move-in and move-out inspection fees

The legislation also makes clear that landlords cannot avoid the law by simply renaming prohibited fees.

 

Important Exceptions and Enforcement

The law would not apply to leases in owner-occupied buildings containing six or fewer units.

Importantly, the requirements apply only to new lease agreements entered into after the effective date. Existing leases would not be affected.

Tenants who believe a violation has occurred may bring a civil action seeking injunctive relief, actual monetary damages, attorney's fees, and costs.

 

Recommended Action for Landlords

Landlords should begin reviewing lease forms, fee schedules, and advertising practices now. Any non-optional fees that remain permissible should be moved to the first page of lease agreements, and any fees prohibited by the new law should be removed from future lease forms.

With the effective date rapidly approaching, proactive review and updating of lease documents can help landlords avoid compliance issues and potential disputes once the law takes effect.

 

Special thanks to Goldenberg Heller & Antognoli, P.C. for providing the information and analysis summarized in this article.

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Under U.S. Treasury regulations, any tax advice in this communication is not intended or written to be used to avoid IRS penalties. Tzinberg & Associates provides this information for general guidance only. It does not constitute tax advice, accounting services, investment advice, or professional consulting. Consult a professional adviser before making decisions or taking action, as the information is provided "as is" without any warranties regarding its completeness, accuracy, or timeliness.