Nitchoff, 77, has been known to tell how he discovered this arcane way of making a living when someone bought the taxes on his own home and threatened to take it from him.
Nitchoff himself has let the taxes lapse on seven south suburban properties he owned for years, until they amassed $861,000 in overdue bills, records examined by the Chicago Sun-Times show.
Then, through a shell game involving three companies Nitchoff and a grandson own, they bought those tax debts at a Cook County property-tax scavenger sale, paying a fraction of what was owed for the right to eventually shift ownership from one of the family’s businesses to another — without having to pay the back taxes.
Grandson Conor Nitchoff’s company, 9C LLC, has paid $5,650 for $734,428 of the taxes owed by his grandfather’s Mako Properties Inc. on five of the seven properties, which appears to be illegal under a state law.
9C LLC was formed by Boris Nitchoff and his then-20-year-old grandson in 2014 — the year before they purchased Boris Nitchoff’s tax debt for pennies on the dollar. Conor Nitchoff says on his LinkedIn page that he worked for Mako, buying and selling commercial properties and appealing their real estate taxes, from 2014 through 2017.
For the other two properties involved in the back-tax shell game, Boris Nitchoff used another company he owns, B. Hartman Group, to buy $126,583 owed by his other company, paying just $20,630.
That also appears to have been done in violation of the law that bars people from getting out of paying what they owe in property taxes by buying those debts at the bargain-basement scavenger sales.
And the grandfather and grandson bought the taxes after signing disclosure forms required by the Cook County treasurer’s office, which holds the tax sales, affirming they had no financial interest in the properties — that they weren’t an owner or “holder of a beneficial interest in or of the property” when the taxes were sold or when they went unpaid.
“Really, if you think about it, it’s illegal, you see?” Boris Nitchoff acknowledges during an interview at his Summit office that’s the home base for the family’s many businesses.
“We thought about it — because the company is under different companies, different owners, it’s not the owner of deed,” he says. “In a way, it could be legal. But I just didn’t want to create problems for the boys and me.”
Records show companies owned by Boris and Conor Nitchoff went to court in 2017, seeking tax deeds on three of the properties owned by Boris Nitchoff’s other company — a Harvey car wash that sits on two lots and a vacant lot in Dolton. That would have let them keep the land in the family without paying the back taxes.
But they dropped the Dolton case and to date haven’t actively pursued the other, still-pending cases because, according to Boris Nitchoff, he was told by a lawyer, “It might open a can of worms for you and create problems. So pay the taxes.”
He says he plans to take the attorney’s advice to pay the back taxes — though only on one of the seven properties, a house in Dolton on which he owes $38,000, plus interest.
Asked why Mako acquired the properties but then ignored the tax bills for years, Nitchoff says,“I bought some properties that I’m stuck with. To pay the taxes, it doesn’t pay. You collecting a thousand dollars rent, your taxes are $13,000, $14,000. So how you gonna survive?”
Even after using 9C LLC and B. Hartman Group to buy Mako’s delinquent taxes, the Nitchoffs still haven’t paid any of their property taxes on the seven properties, an aggregate debt that’s grown to $1.68 million, records show.
The way they have operated is this, the Sun-Times found: Put off paying property taxes for years. Then, when the county treasurer puts the tax debts up for sale and someone else could buy the debt and, with it, a claim to the property, they do that themselves — using another company they own, paying a fraction of what Nitchoff-owned Mako owed.
Boris Nitchoff and his two sons, Alex Nitchoff and Constantino Nitchoff, all were named in a federal search warrant looking into business dealings involving Ald. Carrie Austin (34th) and her chief of staff Chester Wilson, the Sun-Times reported in July. No one has been accused of any crime. Boris Nitchoff says he has done nothing wrong.
The Nitchoffs purchased their own taxes at scavenger sales that Cook County Treasurer Maria Pappas holds every other year to auction off property taxes that haven’t been paid for at least three years. Unlike annual county tax sales, at which bidders must pay the entire outstanding tax debt, scavenger-sale prices start at $440 per property, including fees.
These sales give taxing school districts, municipalities and other taxing bodies money they already budgeted to spend. Property owners have three years to pay what they owe, plus interest, before a tax buyer can sue to take ownership.
The Nitchoff family lives in Lemont and operates several companies that together have gotten tens of millions of dollars in contracts from the city of Chicago to soundproof homes near O’Hare Airport and Midway Airport and rehab or replace porches and roofs for low-income homeowners across the city.
Among the properties that Boris Nitchoff has bought the taxes for is a fire-damaged brick building that was owned by Wilson before the Austin chief of staff maneuvered to have it go to his business partner, free of any back taxes, in a deal made through the Cook County Land Bank Authority.
The Land Bank agency, whose purpose is to get properties back paying taxes, submitted no-cash bids at the July 2019 scavenger sale on five of the Nitchoffs’ parcels.
Conor Nitchoff, who is Alex Nitchoff’s elder son, formed 9C LLC in 2014 with his grandfather out of his parents’ home in Lemont. By 2017, records show the company was solely in the grandson’s name, with Conor Nitchoff’s younger brother also listed as an authorized bidder for 9C at tax sales.
Asked about the Sun-Times’ findings that the Nitchoffs have been buying their own taxes in apparent violation of the law, a spokesman for Pappas says: “We are grateful to the Sun-Times for alerting us about four properties, which prompted us to conduct our own research and identify three more. Any time we come across a matter that raises serious questions, we refer it to the Cook County state’s attorney’s office for investigation.”
BORIS NITCHOFF’S UNPAID PROPERTY TAXES
15825 and 15827 Dixie Highway, Harvey
Boris Nitchoff’s Mako Properties Inc. got these properties for $63,500 in March 2008 — about four years after the Cook County treasurer sold it for back taxes.
Mako paid no property taxes on the land between 2009 and 2013, letting the unpaid tax bill rise to $126,583.68.
Mako sold the property for $170,000 in May 2014 to a land trust whose beneficiaries remain undisclosed. But Mako’s delinquent tax bills remained outstanding and were put up for sale to the high bidder at Cook County’s scavenger sale in 2015.
The $20,630 winning bid came from another Nitchoff company, B. Hartman Group, though Illinois law says no one can buy delinquent taxes at a scavenger sale on properties they own. Nitchoff and his grandson Conor Nitchoff have done that several times.
In 2017, Nitchoff’s lawyer asked a judge to issue a tax deed to B. Hartman so the company could take ownership of the property Mako had sold to the land trust. The case is still pending in court. And the property taxes continue to go unpaid.
The property was back in the scavenger sale this summer, when the Cook County Land Bank Authority, a county agency that acquires tax-delinquent property and sells them to developers, submitted a no-cash bid to acquire the two parcels. If the authority ends up taking ownership, it would clear the properties of the unpaid tax bills that now top $229,000 plus interest.
1415 E. 142nd St., Dolton
A Cook County judge gave Mako Properties a tax deed for this commercial property in 2005 — about three years after Nitchoff bought the unpaid taxes at a county tax sale.
Mako paid no property taxes on it between 2004 and 2013, and the unpaid taxes climbed to $23,363.87.
Those taxes were sold at the 2015 scavenger sale to 9C LLC — formed by Nitchoff and his grandson — which submitted the only bid — $440.
In 2017, 9C LLC’s lawyer asked a judge to issue a tax deed so 9C could take ownership. The Nitchoffs dropped the case in January.
Nitchoff’s delinquent taxes on the property, going back 14 years, now exceed $40,000.
1869 Sibley Blvd., Calumet City
Mako paid $105,962 to buy this used-car lot in 2010 — four years after a company called BCS Services Inc. bought the delinquent taxes on the property at a tax sale.
Mako didn’t pay property taxes between 2011 and 2013, racking up a bill of $189,904.65.
Those taxes were put up for sale at the 2015 scavenger sale, sold to the low bidder for $440. The winning bid came from 9C LLC, which never went to court to seek a deed for the property
Nitchoff initially sought to sell the property to a Lansing woman named Charmain Fisher for $217,000 under an “agreement for deed.” She put down $40,000. But when she missed the first monthly “installment payment,” the deal fell apart. Nitchoff went to court, and a judge kept the property in Mako’s hands.
Mako sold the property last year to Taofik Afolabi for $75,000.
Since buying the property in 2010, Mako hasn’t paid any property taxes on it.
The property went back into the scavenger sale this past summer, when the Cook County Lank Bank Authority submitted a no-cash bid. If the county acquires the property, it would wipe out unpaid taxes that now exceed $556,000, plus interest.
13825 Park Ave., Dolton
Mako got title to this house in 2008, about four years after it was sold at a scavenger sale to a suburban company in the first of four transfers that ended with Nitchoff. It’s unclear whether Mako paid anything for it.
Mako paid no property taxes between 2010 and 2013, and the delinquent taxes rose to $18,145.
Those taxes were sold for $440 at the 2015 scavenger sale to the only bidder, 9C LLC.
9C LLC never sought a tax deed, and the property went back into the scavenger sale this summer, when the Cook County Land Bank Authority submitted a no-cash bid. If Nitchoff doesn’t pay the delinquent taxes, the land bank could take title, erasing the unpaid taxes, which now top $43,000. Nitchoff says he will pay those taxes, which date to 2010.
420 E. 142nd St., Dolton
Mako bought this commercial building for $20,000 from the Dolton Economic Development Authority in 2006.
Mako paid no property taxes on the property between 2007 and 2013, and the unpaid tax bill soared to $373,654.63.
Those taxes were sold for $440 at the 2015 scavenger sale to the lone bidder, 9C LLC. 9C LLC has never sought a tax deed for the property, which is still owned by Mako.
The unpaid taxes on the property now top $541,000.
606 E. 142nd St., Dolton
Mako got a tax deed for these storefronts in 2005, three years after it bought the delinquent taxes.
But then Mako didn’t pay the property taxes, amassing a debt of $129,360.56 by 2013.
Mako transferred ownership of the property in 2013 to Farod Lewis, apparently for $20,000, according to records filed with the Cook County recorder of deeds.
Mako’s unpaid taxes were sold for $3,890 at a scavenger sale. They were bought by 9C LLC. But the company Nitchoff created with his grandson never went to court to take ownership of the property.
The Cook County Land Bank Authority put in a no-cash bid at the 2019 scavenger sale to acquire the property. If it takes ownership, that will erase the unpaid taxes, dating to 2004, that now stand at $275,000.
SOURCES: Cook County treasurer, Cook County assessor, Cook County clerk