100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB2450

 

Introduced , by Rep. Michael J. Zalewski

 

SYNOPSIS AS INTRODUCED:
 
New Act
35 ILCS 5/1102  from Ch. 120, par. 11-1102
35 ILCS 5/1103  from Ch. 120, par. 11-1103
35 ILCS 5/1105  from Ch. 120, par. 11-1105
35 ILCS 120/5a  from Ch. 120, par. 444a
35 ILCS 120/5b  from Ch. 120, par. 444b
35 ILCS 120/5c  from Ch. 120, par. 444c
35 ILCS 520/16  from Ch. 120, par. 2166
35 ILCS 520/17  from Ch. 120, par. 2167
35 ILCS 520/19  from Ch. 120, par. 2169
65 ILCS 5/8-3-15  from Ch. 24, par. 8-3-15
215 ILCS 155/22  from Ch. 73, par. 1422

    Creates the State Tax Lien Registration Act. Provides that the Department of Revenue shall establish and maintain a public database known as the State Tax Lien Registry. Provides that, if any person neglects or refuses to pay any final tax liability, the Department of Revenue may file in the registry a notice of tax lien within 3 years from the date of the final tax liability. Provides that the tax lien is perfected upon inclusion in the registry and shall be attached to all of the existing and after-acquired property of the debtor. Provides that the Department of Revenue may impose filing fees and fees to release the lien. Provides that the Department of Revenue may sell at bulk the information appearing on the tax lien registry; however, that information may not be used by any party for survey, marketing, or solicitation purposes. Amends the Illinois Income Tax Act, the Retailers' Occupation Tax Act, the Cannabis and Controlled Substances Tax Act, and the Title Insurance Act to make conforming changes. Effective January 1, 2018.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB2450LRB100 06026 HLH 16057 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4
ARTICLE 1. STATE TAX LIEN REGISTRATION ACT

 
5    Section 1. Short title. This Act may be cited as the State
6Tax Lien Registration Act.
 
7    Section 1-5. Purpose.
8    (a) The purpose of this Act is to provide a uniform
9statewide system for filing notices of tax liens that are in
10favor of or enforced by the Department. The Department shall
11maintain the system.
12    (b) The scope of this Act is limited to tax liens in real
13property and personal property, tangible and intangible, of
14taxpayers or other persons against whom the Department has
15liens pursuant to law for unpaid final tax liabilities
16administered by the Department.
17    (c) Nothing in this Act shall be construed to invalidate
18any lien filed by the Department with a county recorder of
19deeds prior to the effective date of this Act.
 
20    Section 1-10. Definitions.
21    "Debtor" means a taxpayer or other person against whom

 

 

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1there is an unpaid final tax liability collectible by the
2Department.
3    "Department" means the Department of Revenue.
4    "Final tax liability" means any State tax, fee, penalty, or
5interest owed by a person to the Department where the
6assessment of the liability is not subject to any further
7timely filed administrative or judicial review.
8    "Last-known address of the debtor" means the address of the
9debtor appearing in the records of the Department at the time
10the notice of tax lien is filed in the registry.
11    "Person" means any natural individual, firm, partnership,
12association, joint stock company, joint adventure, public or
13private corporation, limited liability company, or a receiver,
14executor, trustee, guardian or other representative appointed
15by order of any court.
16    "Registry" or "State Tax Lien Registry" means the public
17database maintained by the Department wherein tax liens are
18filed in favor of and enforced by the Department.
 
19    Section 1-15. Registry established.
20    (a) The Department shall establish and maintain a public
21database known as the State Tax Lien Registry. If any person
22neglects or refuses to pay any final tax liability, the
23Department may file in the registry a notice of tax lien within
243 years from the date of the final tax liability.
25    (b) The notice of tax lien file shall include:

 

 

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1        (1) the name and last-known address of the debtor;
2        (2) the name and address of the Department;
3        (3) the tax lien number assigned to the lien by the
4    Department; and
5        (4) the basis for the tax lien, including, but not
6    limited to, the amount owed by the debtor as of the date of
7    filing in the tax lien registry.
 
8    Section 1-20. Tax lien perfected.
9    (a) When a notice of tax lien is filed by the Department in
10the registry, the tax lien is perfected and shall be attached
11to all of the existing and after-acquired property of the
12debtor, both real and personal, tangible and intangible, which
13is located in any and all counties within the State of
14Illinois.
15    (b) The amount of the tax lien shall be a debt due the
16State of Illinois and shall remain a lien upon all property and
17rights to property belonging to the debtor, both real and
18personal, tangible and intangible, which is located in any and
19all counties within the State of Illinois. Interest and penalty
20shall accrue on the tax lien at the same rate and with the same
21restrictions, if any, as specified by statute for the accrual
22of interest and penalty for the type of tax or taxes for which
23the tax lien was issued.
 
24    Section 1-25. Time period of lien.

 

 

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1    (a) A notice of tax lien shall be a lien upon the debtor's
2property located anywhere in the State for a period of 20 years
3from the date of filing unless it is sooner released by the
4Department.
5    (b) A notice of release of tax lien filed in the registry
6shall constitute a release of the tax lien within the
7Department, the registry, and the county in which the tax lien
8was previously filed. The information contained on the registry
9shall be controlling, and the registry shall supersede the
10records of any county.
 
11    Section 1-30. Registry format.
12    (a) The Department shall maintain notices of tax liens
13filed in the registry after the effective date of this Act in
14its information management system in a form that permits the
15information to be readily accessible in an electronic form
16through the Internet and to be reduced to printed form. The
17electronic and printed form shall include the following
18information:
19        (1) the name of the taxpayer;
20        (2) the name and address of the Department;
21        (3) the tax lien number assigned to the lien by the
22    Department;
23        (4) the amount of the taxes, penalties, interest, and
24    fees indicated due on the notice of tax lien received from
25    the Department; and

 

 

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1        (5) the date and time of filing.
2    (b) Information in the registry shall be searchable by name
3of debtor or by tax lien number. The Department shall not
4charge for access to information in the registry.
5    (c) The Department is authorized to sell at bulk the
6information appearing on the tax lien registry. In selling the
7information, the Department shall adopt rules governing the
8process by which the information will be sold and the media or
9method by which it will be available to the purchaser and shall
10set a price for the information that will at least cover the
11cost of producing the information. The proceeds from the sale
12of bulk information shall be retained by the Department and
13used to cover its cost to produce the information sold and to
14maintain the registry.
15    (d) Registry information, whether accessed by name of
16debtor or by tax lien number at no charge, through a bulk sale
17of information, or by other means, shall not be used for
18survey, marketing, or solicitation purposes. Survey,
19marketing, or solicitation purpose does not include any action
20by the Department or its authorized agent to collect a debt
21represented by a tax lien appearing in the registry. The
22Attorney General may bring an action in any court of competent
23jurisdiction to enjoin the unlawful use of registry information
24for survey, marketing, or solicitation purposes and to recover
25the cost of such action, including reasonable attorney's fees.
 

 

 

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1    Section 1-35. Rulemaking. The Department may adopt rules in
2accordance with the Illinois Administrative Procedure Act to
3enforce the provisions of this Act.
 
4    Section 1-40. Conflicts. In the event of conflict between
5this Act and any other law, this Act shall control.
 
6
ARTICLE 5. AMENDATORY PROVISIONS

 
7    Section 5-5. The Illinois Income Tax Act is amended by
8changing Sections 1102, 1103, and 1105 as follows:
 
9    (35 ILCS 5/1102)  (from Ch. 120, par. 11-1102)
10    Sec. 1102. Jeopardy Assessments.
11    (a) Jeopardy assessment and lien.
12        (1) Assessment. If the Department finds that a taxpayer
13    is about to depart from the State, or to conceal himself or
14    his property, or to do any other act tending to prejudice
15    or to render wholly or partly ineffectual proceedings to
16    collect any amount of tax or penalties imposed under this
17    Act unless court proceedings are brought without delay, or
18    if the Department finds that the collection of such amount
19    will be jeopardized by delay, the Department shall give the
20    taxpayer notice of such findings and shall make demand for
21    immediate return and payment of such amount, whereupon such
22    amount shall be deemed assessed and shall become

 

 

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1    immediately due and payable.
2        (2) Filing of lien. If the taxpayer, within 5 days
3    after such notice (or within such extension of time as the
4    Department may grant), does not comply with such notice or
5    show to the Department that the findings in such notice are
6    erroneous, the Department may file a notice of jeopardy
7    assessment lien in the State Tax Lien Registry office of
8    the recorder of the county in which any property of the
9    taxpayer may be located and shall notify the taxpayer of
10    such filing. Such jeopardy assessment lien shall have the
11    same scope and effect as a statutory lien under this Act.
12    The taxpayer is liable for any administrative fee imposed
13    by the Department by rule in connection with the State Tax
14    Lien Registry the filing fee incurred by the Department for
15    filing the lien and the filing fee incurred by the
16    Department to file the release of that lien. The filing
17    fees shall be paid to the Department in addition to payment
18    of the tax, penalty, and interest included in the amount of
19    the lien.
20    (b) Termination of taxable year. In the case of a tax for a
21current taxable year, the Director shall declare the taxable
22period of the taxpayer immediately terminated and his notice
23and demand for a return and immediate payment of the tax shall
24relate to the period declared terminated, including therein
25income accrued and deductions incurred up to the date of
26termination if not otherwise properly includible or deductible

 

 

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1in respect of such taxable year.
2    (c) Protest. If the taxpayer believes that he does not owe
3some or all of the amount for which the jeopardy assessment
4lien against him has been filed, or that no jeopardy to the
5revenue in fact exists, he may protest within 20 days after
6being notified by the Department of the filing of such jeopardy
7assessment lien and request a hearing, whereupon the Department
8shall hold a hearing in conformity with the provisions of
9section 908 and, pursuant thereto, shall notify the taxpayer of
10its decision as to whether or not such jeopardy assessment lien
11will be released.
12(Source: P.A. 92-826, eff. 1-1-03.)
 
13    (35 ILCS 5/1103)  (from Ch. 120, par. 11-1103)
14    Sec. 1103. Filing and Priority of Liens.
15    (a) Filing in the State Tax Lien Registry with Recorder.
16Nothing in this Article shall be construed to give the
17Department a preference over the rights of any bona fide
18purchaser, holder of a security interest, mechanics lienor,
19mortgagee, or judgment lien creditor arising prior to the
20filing of a regular notice of lien or a notice of jeopardy
21assessment lien in the State Tax Lien Registry office of the
22recorder in the county in which the property subject to the
23lien is located. For purposes of this Section section, the term
24"bona fide," shall not include any mortgage of real or personal
25property or any other credit transaction that results in the

 

 

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1mortgagee or the holder of the security acting as trustee for
2unsecured creditors of the taxpayer mentioned in the notice of
3lien who executed such chattel or real property mortgage or the
4document evidencing such credit transaction. Such lien shall be
5inferior to the lien of general taxes, special assessments and
6special taxes heretofore or hereafter levied by any political
7subdivision of this State.
8    (b) Filing in the State Tax Lien Registry with Registrar.
9In case title to land to be affected by the notice of lien or
10notice of jeopardy assessment lien is registered under the
11provisions of "An Act concerning land titles," approved May 1,
121897, as amended, such notice shall also be filed in the State
13Tax Lien Registry office of the Registrar of Titles of the
14county within which the property subject to the lien is
15situated and shall be entered upon the register of titles as a
16memorial of charge upon each folium of the register of titles
17affected by such notice, and the Department shall not have a
18preference over the rights of any bona fide purchaser,
19mortgagee, judgment creditor or other lien holder arising prior
20to the registration of such notice.
21    (c) Index. The Department of Revenue shall maintain a State
22Tax Lien Index of all tax liens filed in the State Tax Lien
23Registry as provided for by the State Tax Lien Registration
24Act. The recorder of each county shall procure a file labeled
25"State Tax Lien Notices" and an index book labeled "State Tax
26Lien Index." When notice of any lien or jeopardy assessment

 

 

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1lien is presented to him for filing, he shall file it in
2numerical order in the file and shall enter it alphabetically
3in the index. The entry shall show the name and last known
4address of the person named in the notice, the serial number of
5the notice, the date and hour of filing, whether it is a
6regular lien or a jeopardy assessment lien, and the amount of
7tax and penalty due and unpaid, plus the amount of interest due
8at the time when the notice of lien or jeopardy assessment is
9filed.
10    (d) (Blank). No recorder or registrar of titles of any
11county shall require that the Department pay any costs or fees
12in connection with recordation of any notice or other document
13filed by the Department under this Act at the time such notice
14or other document is presented for recordation. The recorder or
15registrar of each county, in order to receive payment for fees
16or costs incurred by the Department, shall present the
17Department with monthly statements indicating the amount of
18fees and costs incurred by the Department and for which no
19payment has been received. This amendatory Act of 1987 applies
20to all liens heretofore or hereafter filed.
21    (e) The taxpayer is liable for any the filing fees imposed
22fee incurred by the Department for filing the lien in the State
23Tax Lien Registry and any the filing fees imposed fee incurred
24by the Department for to file the release of that lien. The
25filing fees shall be paid to the Department in addition to
26payment of the tax, penalty, and interest included in the

 

 

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1amount of the lien.
2(Source: P.A. 92-826, eff. 1-1-03.)
 
3    (35 ILCS 5/1105)  (from Ch. 120, par. 11-1105)
4    Sec. 1105. Release of Liens.
5    (a) In general. Upon payment by the taxpayer to the
6Department in cash or by guaranteed remittance of an amount
7representing the filing fees and charges for the lien and the
8filing fees and charges for the release of that lien, the
9Department shall release all or any portion of the property
10subject to any lien provided for in this Act and file that
11complete or partial release of lien in the State Tax Lien
12Registry with the recorder of the county where that lien was
13filed if it determines that the release will not endanger or
14jeopardize the collection of the amount secured thereby.
15    (b) Judicial determination. If on judicial review the final
16judgment of the court is that the taxpayer does not owe some or
17all of the amount secured by the lien against him, or that no
18jeopardy to the revenue exists, the Department shall release
19its lien to the extent of such finding of nonliability, or to
20the extent of such finding of no jeopardy to the revenue. The
21taxpayer shall, however, be liable for the filing fee imposed
22paid by the Department to file the lien and the filing fee
23imposed to release required to file a release of the lien. The
24filing fees shall be paid to the Department.
25    (c) Payment. The Department shall also release its jeopardy

 

 

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1assessment lien against the taxpayer whenever the tax and
2penalty covered by such lien, plus any interest which may be
3due and an amount representing the filing fee to file the lien
4and the filing fee imposed to release required to file a
5release of that lien, are paid by the taxpayer to the
6Department in cash or by guaranteed remittance.
7    (d) Certificate of release. The Department shall issue a
8certificate of complete or partial release of the lien upon
9payment by the taxpayer to the Department in cash or by
10guaranteed remittance of an amount representing the filing fee
11imposed paid by the Department to file the lien and the filing
12fee imposed to release required to file the release of that
13lien:
14        (1) to the extent that the fair market value of any
15    property subject to the lien exceeds the amount of the lien
16    plus the amount of all prior liens upon such property;
17        (2) to the extent that such lien shall become
18    unenforceable;
19        (3) to the extent that the amount of such lien is paid
20    by the person whose property is subject to such lien,
21    together with any interest and penalty which may become due
22    under this Act between the date when the notice of lien is
23    filed and the date when the amount of such lien is paid;
24        (4) to the extent that there is furnished to the
25    Department on a form to be approved and with a surety or
26    sureties satisfactory to the Department a bond that is

 

 

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1    conditioned upon the payment of the amount of such lien,
2    together with any interest which may become due under this
3    Act after the notice of lien is filed, but before the
4    amount thereof is fully paid;
5        (5) to the extent and under the circumstances specified
6    in this Section.
7    A certificate of complete or partial release of any lien
8shall be held conclusive that the lien upon the property
9covered by the certificate is extinguished to the extent
10indicated by such certificate.
11    Such release of lien shall be issued to the person, or his
12agent, against whom the lien was obtained and shall contain in
13legible letters a statement as follows:
14    FOR THE PROTECTION OF THE OWNER, THIS RELEASE SHALL
15    BE FILED IN THE STATE TAX LIEN REGISTRY WITH THE RECORDER 
16OR THE REGISTRAR
17    OF TITLES, IN WHOSE OFFICE, THE LIEN WAS FILED.
18    (e) Filing. When a certificate of complete or partial
19release of lien issued by the Department is filed in the State
20Tax Lien Registry, the Department presented for filing in the
21office of the recorder or Registrar of Titles where a notice of
22lien or notice of jeopardy assessment lien was filed:
23        (1) the recorder, in the case of nonregistered
24    property, shall permanently attach the certificate of
25    release to the notice of lien or notice of jeopardy
26    assessment lien and shall enter the certificate of release

 

 

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1    and the date in the "State Tax Lien Index" on the line
2    where the notice of lien or notice of jeopardy assessment
3    lien is entered. ; and
4        (2) in the case of registered property, the Registrar
5    of Titles shall file and enter upon each folium of the
6    register of titles affected thereby a memorial of the
7    certificate of release which memorial when so entered shall
8    act as a release pro tanto of any memorial of such notice
9    of lien or notice of jeopardy assessment lien previously
10    filed and registered.
11(Source: P.A. 92-826, eff. 1-1-03.)
 
12    Section 5-10. The Retailers' Occupation Tax Act is amended
13by changing Sections 5a, 5b, and 5c as follows:
 
14    (35 ILCS 120/5a)  (from Ch. 120, par. 444a)
15    Sec. 5a. The Department shall have a lien for the tax
16herein imposed or any portion thereof, or for any penalty
17provided for in this Act, or for any amount of interest which
18may be due as provided for in Section 5 of this Act, upon all
19the real and personal property of any person to whom a final
20assessment or revised final assessment has been issued as
21provided in this Act, or whenever a return is filed without
22payment of the tax or penalty shown therein to be due,
23including all such property of such persons acquired after
24receipt of such assessment or filing of such return. The

 

 

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1taxpayer is liable for the filing fee imposed incurred by the
2Department for filing the lien and the filing fee imposed
3incurred by the Department to file the release the of that
4lien. The filing fees shall be paid to the Department in
5addition to payment of the tax, penalty, and interest included
6in the amount of the lien.
7    However, where the lien arises because of the issuance of a
8final assessment or revised final assessment by the Department,
9such lien shall not attach and the notice hereinafter referred
10to in this Section shall not be filed until all proceedings in
11court for review of such final assessment or revised final
12assessment have terminated or the time for the taking thereof
13has expired without such proceedings being instituted.
14    Upon the granting of a rehearing or departmental review
15pursuant to Section 4 or Section 5 of this Act after a lien has
16attached, such lien shall remain in full force except to the
17extent to which the final assessment may be reduced by a
18revised final assessment following such rehearing or review.
19    The lien created by the issuance of a final assessment
20shall terminate unless a notice of lien is filed, as provided
21in Section 5b hereof, within 3 years from the date all
22proceedings in court for the review of such final assessment
23have terminated or the time for the taking thereof has expired
24without such proceedings being instituted, or (in the case of a
25revised final assessment issued pursuant to a rehearing or
26departmental review) within 3 years from the date all

 

 

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1proceedings in court for the review of such revised final
2assessment have terminated or the time for the taking thereof
3has expired without such proceedings being instituted; and
4where the lien results from the filing of a return without
5payment of the tax or penalty shown therein to be due, the lien
6shall terminate unless a notice of lien is filed, as provided
7in Section 5b hereof, within 3 years from the date when such
8return is filed with the Department: Provided that the time
9limitation period on the Department's right to file a notice of
10lien shall not run (1) during any period of time in which the
11order of any court has the effect of enjoining or restraining
12the Department from filing such notice of lien, or (2) during
13the term of a repayment plan that taxpayer has entered into
14with the Department, as long as taxpayer remains in compliance
15with the terms of the repayment plan.
16    If the Department finds that a taxpayer is about to depart
17from the State, or to conceal himself or his property, or to do
18any other act tending to prejudice or to render wholly or
19partly ineffectual proceedings to collect such tax unless such
20proceedings are brought without delay, or if the Department
21finds that the collection of the amount due from any taxpayer
22will be jeopardized by delay, the Department shall give the
23taxpayer notice of such findings and shall make demand for
24immediate return and payment of such tax, whereupon such tax
25shall become immediately due and payable. If the taxpayer,
26within 5 days after such notice (or within such extension of

 

 

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1time as the Department may grant), does not comply with such
2notice or show to the Department that the findings in such
3notice are erroneous, the Department may file a notice of
4jeopardy assessment lien in the State Tax Lien Registry office
5of the recorder of the county in which any property of the
6taxpayer may be located and shall notify the taxpayer of such
7filing. Such jeopardy assessment lien shall have the same scope
8and effect as the statutory lien hereinbefore provided for in
9this Section.
10    If the taxpayer believes that he does not owe some or all
11of the tax for which the jeopardy assessment lien against him
12has been filed, or that no jeopardy to the revenue in fact
13exists, he may protest within 20 days after being notified by
14the Department of the filing of such jeopardy assessment lien
15and request a hearing, whereupon the Department shall hold a
16hearing in conformity with the provisions of this Act and,
17pursuant thereto, shall notify the taxpayer of its findings as
18to whether or not such jeopardy assessment lien will be
19released. If not, and if the taxpayer is aggrieved by this
20decision, he may file an action for judicial review of such
21final determination of the Department in accordance with
22Section 12 of this Act and the Administrative Review Law.
23    On and after July 1, 2013, protests concerning matters that
24are subject to the jurisdiction of the Illinois Independent Tax
25Tribunal shall be filed with the Tribunal, and hearings on
26those matters shall be held before the Tribunal in accordance

 

 

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1with the Illinois Independent Tax Tribunal Act of 2012. The
2Tribunal shall notify the taxpayer of its findings as to
3whether or not such jeopardy assessment lien will be released.
4If not, and if the taxpayer is aggrieved by this decision, he
5may file an action for judicial review of such final
6determination of the Department in accordance with Section 12
7of this Act and the Illinois Independent Tax Tribunal Act of
82012.
9    With respect to protests filed with the Department prior to
10July 1, 2013 that would otherwise be subject to the
11jurisdiction of the Illinois Independent Tax Tribunal, the
12taxpayer may elect to be subject to the provisions of the
13Illinois Independent Tax Tribunal Act of 2012 at any time on or
14after July 1, 2013, but not later than 30 days after the date
15on which the protest was filed. If made, the election shall be
16irrevocable.
17    If, pursuant to such hearing (or after an independent
18determination of the facts by the Department without a
19hearing), the Department or the Tribunal determines that some
20or all of the tax covered by the jeopardy assessment lien is
21not owed by the taxpayer, or that no jeopardy to the revenue
22exists, or if on judicial review the final judgment of the
23court is that the taxpayer does not owe some or all of the tax
24covered by the jeopardy assessment lien against him, or that no
25jeopardy to the revenue exists, the Department shall release
26its jeopardy assessment lien to the extent of such finding of

 

 

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1nonliability for the tax, or to the extent of such finding of
2no jeopardy to the revenue.
3    The Department shall also release its jeopardy assessment
4lien against the taxpayer whenever the tax and penalty covered
5by such lien, plus any interest which may be due, are paid and
6the taxpayer has paid the Department in cash or by guaranteed
7remittance an amount representing the filing fee for the lien
8and the filing fee for the release of that lien. The Department
9shall file that release of lien in the State Tax Lien Registry
10with the recorder of the county where that lien was filed.
11    Nothing in this Section shall be construed to give the
12Department a preference over the rights of any bona fide
13purchaser, holder of a security interest, mechanics
14lienholder, mortgagee, or judgment lien creditor arising prior
15to the filing of a regular notice of lien or a notice of
16jeopardy assessment lien in the State Tax Lien Registry office
17of the recorder in the county in which the property subject to
18the lien is located: Provided, however, that the word "bona
19fide", as used in this Section shall not include any mortgage
20of real or personal property or any other credit transaction
21that results in the mortgagee or the holder of the security
22acting as trustee for unsecured creditors of the taxpayer
23mentioned in the notice of lien who executed such chattel or
24real property mortgage or the document evidencing such credit
25transaction. Such lien shall be inferior to the lien of general
26taxes, special assessments and special taxes heretofore or

 

 

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1hereafter levied by any political subdivision of this State.
2    In case title to land to be affected by the notice of lien
3or notice of jeopardy assessment lien is registered under the
4provisions of "An Act concerning land titles", approved May 1,
51897, as amended, such notice shall also be filed in the State
6Tax Lien Registry office of the Registrar of Titles of the
7county within which the property subject to the lien is
8situated and shall be entered upon the register of titles as a
9memorial or charge upon each folium of the register of titles
10affected by such notice, and the Department shall not have a
11preference over the rights of any bona fide purchaser,
12mortgagee, judgment creditor or other lien holder arising prior
13to the registration of such notice: Provided, however, that the
14word "bona fide" shall not include any mortgage of real or
15personal property or any other credit transaction that results
16in the mortgagee or the holder of the security acting as
17trustee for unsecured creditors of the taxpayer mentioned in
18the notice of lien who executed such chattel or real property
19mortgage or the document evidencing such credit transaction.
20    Such regular lien or jeopardy assessment lien shall not be
21effective against any purchaser with respect to any item in a
22retailer's stock in trade purchased from the retailer in the
23usual course of such retailer's business.
24(Source: P.A. 97-1129, eff. 8-28-12; 98-446, eff. 8-16-13.)
 
25    (35 ILCS 120/5b)  (from Ch. 120, par. 444b)

 

 

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1    Sec. 5b. State Tax Lien Index. The Department of Revenue
2shall maintain a State Tax Lien Index of all tax liens filed in
3the State Tax Lien Registry as provided for by the State Tax
4Lien Registration Act. The recorder of each county shall
5procure a file labeled "State Tax Lien Notices" and an index
6book labeled "State Tax Lien Index". When notice of any lien or
7jeopardy assessment lien is presented to him for filing, he
8shall file it in numerical order in the file and shall enter it
9alphabetically in the index. The entry shall show the name and
10last known business address of the person named in the notice,
11the serial number of the notice, the date and hour of filing,
12whether it is a regular lien or a jeopardy assessment lien, and
13the amount of tax and penalty due and unpaid, plus the amount
14of interest due under Section 5 of this Act at the time when
15the notice of lien or jeopardy assessment lien is filed.
16    No recorder or registrar of titles of any county shall
17require that the Department pay any costs or fees in connection
18with recordation of any notice or other document filed by the
19Department under this Act at the time such notice or other
20document is presented for recordation. The recorder or
21registrar of each county, in order to receive payment for fees
22or costs incurred by the Department, shall present the
23Department with monthly statements indicating the amount of
24fees and costs incurred by the Department and for which no
25payment has been received.
26    A notice of lien may be filed after the issuance of a

 

 

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1revised final assessment pursuant to a rehearing or
2departmental review under Section 4 or Section 5 of this Act.
3    When the lien obtained pursuant to this Act has been
4satisfied and the taxpayer has paid the Department in cash or
5by guaranteed remittance an amount representing the filing fee
6for the lien and the filing fee for the release of that lien,
7the Department shall issue a release of lien and file that
8release of lien in the State Tax Lien Registry with the
9recorder of the county where that lien was filed. The release
10of lien shall contain in legible letters a statement as
11follows:
12    FOR THE PROTECTION OF THE OWNER, THIS RELEASE SHALL
13    BE FILED IN THE STATE TAX LIEN REGISTRY WITH THE RECORDER 
14OR THE REGISTRAR
15    OF TITLES, IN WHOSE OFFICE, THE LIEN WAS FILED.
16    When a certificate of complete or partial release of lien
17issued by the Department is filed in the State Tax Lien
18Registry, the Department of Revenue presented for filing in the
19office of the recorder or Registrar of Titles where a notice of
20lien or notice of jeopardy assessment lien was filed, the
21recorder, in the case of nonregistered property, shall
22permanently attach the certificate of release to the notice of
23lien or notice of jeopardy assessment lien and shall enter the
24certificate of release and the date in the "State Tax Lien
25Index" on the line where the notice of lien or notice of
26jeopardy assessment lien is entered.

 

 

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1    In the case of registered property, the Registrar of Titles
2shall file and enter upon each folium of the register of titles
3affected thereby a memorial of the certificate of release which
4memorial when so entered shall act as a release pro tanto of
5any memorial of such notice of lien or notice of jeopardy
6assessment lien previously filed and registered.
7(Source: P.A. 92-826, eff. 1-1-03.)
 
8    (35 ILCS 120/5c)  (from Ch. 120, par. 444c)
9    Sec. 5c. Upon payment by the taxpayer to the Department in
10cash or by guaranteed remittance of an amount representing the
11filing fee for the lien and the filing fee for the release of
12that lien, the Department shall issue a certificate of complete
13or partial release of the lien and file that complete or
14partial release of lien in the State Tax Lien Registry with the
15recorder of the county where the lien was filed:
16        (a) to the extent that the fair market value of any
17    property subject to the lien exceeds the amount of the lien
18    plus the amount of all prior liens upon such property;
19        (b) to the extent that such lien shall become
20    unenforceable;
21        (c) to the extent that the amount of such lien is paid
22    by the retailer whose property is subject to such lien,
23    together with any interest which may become due under
24    Section 5 of this Act between the date when the notice of
25    lien is filed and the date when the amount of such lien is

 

 

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1    paid;
2        (d) to the extent that there is furnished to the
3    Department on a form to be approved and with a surety or
4    sureties satisfactory to the Department a bond that is
5    conditioned upon the payment of the amount of such lien,
6    together with any interest which may become due under
7    Section 5 of this Act after the notice of lien is filed,
8    but before the amount thereof is fully paid;
9        (e) to the extent and under the circumstances specified
10    in Section 5a of this Act in the case of jeopardy
11    assessment liens;
12        (f) to the extent to which an assessment is reduced
13    pursuant to a rehearing or departmental review under
14    Section 4 or Section 5 of this Act.
15    A certificate of complete or partial release of any lien
16shall be held conclusive that the lien upon the property
17covered by the certificate is extinguished to the extent
18indicated by such certificate.
19(Source: P.A. 92-826, eff. 1-1-03.)
 
20    Section 5-15. The Cannabis and Controlled Substances Tax
21Act is amended by changing Sections 16, 17, and 19 as follows:
 
22    (35 ILCS 520/16)  (from Ch. 120, par. 2166)
23    Sec. 16. All assessments are Jeopardy Assessments - lien.
24    (a) Assessment. An assessment for a dealer not possessing

 

 

HB2450- 25 -LRB100 06026 HLH 16057 b

1valid stamps or other official indicia showing that the tax has
2been paid shall be considered a jeopardy assessment or
3collection, as provided by Section 1102 of the Illinois Income
4Tax Act. The Department shall determine and assess a tax and
5applicable penalties and interest according to the best
6judgment and information available to the Department, which
7amount so fixed by the Department shall be prima facie correct
8and shall be prima facie evidence of the correctness of the
9amount of tax due, as shown in such determination. When,
10according to the best judgment and information available to the
11Department with regard to all real and personal property and
12rights to property of the dealer, there is no reasonable
13expectation of collection of the amount of tax and penalty to
14be assessed, the Department may issue an assessment under this
15Section for the amount of tax without penalty.
16    (b) Filing of Lien. Upon issuance of a jeopardy assessment
17as provided by subsection (a) of this Section, the Department
18may file a notice of jeopardy assessment lien in the State Tax
19Lien Registry office of the recorder of the county in which any
20property of the taxpayer may be located and shall notify the
21taxpayer of such filing.
22    (c) Protest. If the taxpayer believes that he does not owe
23some or all of the amount for which the jeopardy assessment
24lien against him has been filed, he may protest within 20 days
25after being notified by the Department of the filing of such
26jeopardy assessment lien and request a hearing, whereupon the

 

 

HB2450- 26 -LRB100 06026 HLH 16057 b

1Department shall hold a hearing in conformity with the
2provisions of Section 908 of the Illinois Income Tax Act and,
3pursuant thereto, shall notify the taxpayer of its decision as
4to whether or not such jeopardy assessment lien will be
5released.
6    After the expiration of the period within which the person
7assessed may file an action for judicial review without such
8action being filed, a certified copy of the final assessment or
9revised final assessment of the Department may be filed with
10the Circuit Court of the county in which the dealer resides, or
11of Cook County in the case of a dealer who does not reside in
12this State, or in the county where the violation of this Act
13took place. The certified copy of the final assessment or
14revised final assessment shall be accompanied by a
15certification which recites facts that are sufficient to show
16that the Department complied with the jurisdictional
17requirements of the Act in arriving at its final assessment or
18its revised final assessment and that the dealer had this
19opportunity for an administrative hearing and for judicial
20review, whether he availed himself or herself of either or both
21of these opportunities or not. If the court is satisfied that
22the Department complied with the jurisdictional requirements
23of the Act in arriving at its final assessment or its revised
24final assessment and that the taxpayer had his opportunity for
25an administrative hearing and for judicial review, whether he
26availed himself of either or both of these opportunities or

 

 

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1not, the court shall render judgment in favor of the Department
2and against the taxpayer for the amount shown to be due by the
3final assessment or the revised final assessment, plus any
4interest which may be due, and such judgment shall be entered
5in the judgment docket of the court. Such judgment shall bear
6the same rate of interest and shall have the same effect as
7other judgments. The judgment may be enforced, and all laws
8applicable to sales for the enforcement of a judgment shall be
9applicable to sales made under such judgments. The Department
10shall file the certified copy of its assessment, as herein
11provided, with the Circuit Court within 2 years after such
12assessment becomes final except when the taxpayer consents in
13writing to an extension of such filing period, and except that
14the time limitation period on the Department's right to file
15the certified copy of its assessment with the Circuit Court
16shall not run during any period of time in which the order of
17any court has the effect of enjoining or restraining the
18Department from filing such certified copy of its assessment
19with the Circuit Court.
20    If, when the cause of action for a proceeding in court
21accrues against a person, he or she is out of the State, the
22action may be commenced within the times herein limited, after
23his or her coming into or returning to the State; and if, after
24the cause of action accrues, he or she departs from and remains
25out of the State, the time of his or her absence from the
26State, the time of his or her absence is no part of the time

 

 

HB2450- 28 -LRB100 06026 HLH 16057 b

1limited for the commencement of the action; but the foregoing
2provisions concerning absence from the State shall not apply to
3any case in which, at the time the cause of action accrues, the
4party against whom the cause of action accrues is not a
5resident of this State. The time within which a court action is
6to be commenced by the Department hereunder shall not run from
7the date the taxpayer files a petition in bankruptcy under the
8Federal Bankruptcy Act until 30 days after notice of
9termination or expiration of the automatic stay imposed by the
10Federal Bankruptcy Act.
11    No claim shall be filed against the estate of any deceased
12person or any person under legal disability for any tax or
13penalty or part of either, or interest, except in the manner
14prescribed and within the time limited by the Probate Act of
151975, as amended.
16    The collection of tax or penalty or interest by any means
17provided for herein shall not be a bar to any prosecution under
18this Act.
19    In addition to any penalty provided for in this Act, any
20amount of tax which is not paid when due shall bear interest at
21the rate determined in accordance with the Uniform Penalty and
22Interest Act, per month or fraction thereof from the date when
23such tax becomes past due until such tax is paid or a judgment
24therefor is obtained by the Department. If the time for making
25or completing an audit of a taxpayer's books and records is
26extended with the taxpayer's consent, at the request of and for

 

 

HB2450- 29 -LRB100 06026 HLH 16057 b

1the convenience of the Department, beyond the date on which the
2statute of limitations upon the issuance of a notice of tax
3liability by the Department otherwise run, no interest shall
4accrue during the period of such extension. Interest shall be
5collected in the same manner and as part of the tax.
6    If the Department determines that an amount of tax or
7penalty or interest was incorrectly assessed, whether as the
8result of a mistake of fact or an error of law, the Department
9shall waive the amount of tax or penalty or interest that
10accrued due to the incorrect assessment.
11(Source: P.A. 97-1129, eff. 8-28-12.)
 
12    (35 ILCS 520/17)  (from Ch. 120, par. 2167)
13    Sec. 17. Filing and Priority of Liens. (a) Filing in the
14State Tax Lien Registry with Recorder. Nothing in this Act
15shall be construed to give the Department a preference over the
16rights of any bona fide purchaser, holder of a security
17interest, mechanics lienholder, mortgagee, or judgment lien
18creditor arising prior to the filing of a regular notice of
19lien or a notice of jeopardy assessment lien in the State Tax
20Lien Registry office of the recorder in the county in which the
21property subject to the lien is located. For purposes of this
22section, the term "bona fide," shall not include any mortgage
23of real or personal property or any other credit transaction
24that results in the mortgagee or the holder of the security
25acting as trustee for unsecured creditors of the taxpayer

 

 

HB2450- 30 -LRB100 06026 HLH 16057 b

1mentioned in the notice of lien who executed such chattel or
2real property mortgage or the document evidencing such credit
3transaction. Such lien shall be inferior to the lien of general
4taxes, special assessments and special taxes heretofore or
5hereafter levied by any political subdivision of this State.
6    (b) Filing with Registrar. In case title to land to be
7affected by the notice of lien or notice of jeopardy assessment
8lien is registered under the provisions of "An Act concerning
9land titles," approved May 1, 1897, as amended, such notice
10shall also be filed in the State Tax Lien Registry office of
11the Registrar of Titles of the county within which the property
12subject to the lien is situated and shall be entered upon the
13register of titles as a memorial of charge upon each folium of
14the register of titles affected by such notice, and the
15Department shall not have a preference over the rights of any
16bona fide purchaser, mortgagee, judgment creditor or other lien
17holder arising prior to the registration of such notice.
18    (c) (Blank). No recorder or registrar of titles of any
19county shall require that the Department pay any costs or fees
20in connection with recordation of any notice or other document
21filed by the Department under this Act at the time such notice
22or other document is presented for recordation.
23(Source: P.A. 86-905.)
 
24    (35 ILCS 520/19)  (from Ch. 120, par. 2169)
25    Sec. 19. Release of Liens.

 

 

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1    (a) In general. The Department shall release all or any
2portion of the property subject to any lien provided for in
3this Act if it determines that the release will not endanger or
4jeopardize the collection of the amount secured thereby. The
5Department shall release its lien on property which is the
6subject of forfeiture proceedings under the Narcotics Profit
7Forfeiture Act, the Criminal Code of 2012, or the Drug Asset
8Forfeiture Procedure Act until all forfeiture proceedings are
9concluded. Property forfeited shall not be subject to a lien
10under this Act.
11    (b) Judicial determination. If on judicial review the final
12judgment of the court is that the taxpayer does not owe some or
13all of the amount secured by the lien against him, or that no
14jeopardy to the revenue exists, the Department shall release
15its lien to the extent of such finding of nonliability, or to
16the extent of such finding of no jeopardy to the revenue.
17    (c) Payment. The Department shall also release its jeopardy
18assessment lien against the taxpayer whenever the tax and
19penalty covered by such lien, plus any interest which may be
20due, are paid.
21    (d) Certificate of release. The Department shall issue a
22certificate of complete or partial release of the lien:
23        (1) To the extent that the fair market value of any
24    property subject to the lien exceeds the amount of the lien
25    plus the amount of all prior liens upon such property;
26        (2) To the extent that such lien shall become

 

 

HB2450- 32 -LRB100 06026 HLH 16057 b

1    unenforceable;
2        (3) To the extent that the amount of such lien is paid
3    by the person whose property is subject to such lien,
4    together with any interest and penalty which may become due
5    under this Act between the date when the notice of lien is
6    filed and the date when the amount of such lien is paid;
7        (4) To the extent and under the circumstances specified
8    in this Section. A certificate of complete or partial
9    release of any lien shall be held conclusive that the lien
10    upon the property covered by the certificate is
11    extinguished to the extent indicated by such certificate.
12    Such release of lien shall be issued to the person, or his
13agent, against whom the lien was obtained and shall contain in
14legible letters a statement as follows:
15    FOR THE PROTECTION OF THE OWNER, THIS RELEASE SHALL
16    BE FILED IN THE STATE TAX LIEN REGISTRY WITH THE RECORDER 
17OR THE REGISTRAR
18    OF TITLES, IN WHOSE OFFICE, THE LIEN WAS FILED.
19    (e) Filing. When a certificate of complete or partial
20release of lien issued by the Department is filed in the State
21Tax Lien Registry, the Department presented for filing in the
22office of the recorder or Registrar of Titles where a notice of
23lien or notice of jeopardy assessment lien was filed:
24        (1) The recorder, in the case of nonregistered
25    property, shall permanently attach the certificate of
26    release to the notice of lien or notice of jeopardy

 

 

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1    assessment lien and shall enter the certificate of release
2    and the date in the "State Tax Lien Index" on the line
3    where the notice of lien or notice of jeopardy assessment
4    lien is entered. ; and
5        (2) In the case of registered property, the Registrar
6    of Titles shall file and enter upon each folium of the
7    register of titles affected thereby a memorial of the
8    certificate of release which memorial when so entered shall
9    act as a release pro tanto of any memorial of such notice
10    of lien or notice of jeopardy assessment lien previously
11    filed and registered.
12(Source: P.A. 97-1150, eff. 1-25-13.)
 
13    Section 5-20. The Illinois Municipal Code is amended by
14changing Section 8-3-15 as follows:
 
15    (65 ILCS 5/8-3-15)  (from Ch. 24, par. 8-3-15)
16    Sec. 8-3-15. The corporate authorities of each
17municipality shall have all powers necessary to enforce the
18collection of any tax imposed and collected by such
19municipality, whether such tax was imposed pursuant to its home
20rule powers or statutory authorization, including but not
21limited to subpoena power and the power to create and enforce
22liens. No such lien shall affect the rights of bona fide
23purchasers, mortgagees, judgment creditors or other
24lienholders who acquire their interests in such property prior

 

 

HB2450- 34 -LRB100 06026 HLH 16057 b

1to the time a notice of such lien is placed on record in the
2office of the recorder or the registrar of titles of the county
3in which the property is located. However, nothing in this
4Section shall permit a municipality to place a lien upon
5property not located or found within its corporate boundaries.
6A municipality creating a lien may provide that the procedures
7for its notice and enforcement shall be the same as that
8provided in the Retailers' Occupation Tax Act, as that Act
9existed prior to the adoption of the State Tax Lien
10Registration Act now or hereafter amended, for State tax liens,
11and any recorder or registrar of titles with whom a notice of
12such lien is filed shall treat such lien as a State tax lien
13for recording purposes.
14(Source: P.A. 86-680.)
 
15    Section 5-25. The Title Insurance Act is amended by
16changing Section 22 as follows:
 
17    (215 ILCS 155/22)  (from Ch. 73, par. 1422)
18    Sec. 22. Tax indemnity; notice. A corporation authorized to
19do business under this Act shall notify the Director of Revenue
20of the State of Illinois, by notice directed to his office in
21the City of Chicago, of each trust account or similar account
22established which relates to title exceptions due to a judgment
23lien or any other lien arising under any tax Act administered
24by the Illinois Department of Revenue, when notice of such lien

 

 

HB2450- 35 -LRB100 06026 HLH 16057 b

1has been filed with the registrar of titles or recorder or in
2the State Tax Lien Registry, as the case may be, in the manner
3prescribed by law. Such notice shall contain the name, address,
4and tax identification number of the debtor, the permanent real
5estate index numbers, if any, and the address and legal
6description of the property, the type of lien claimed by the
7Department and identification of any trust fund or similar
8account held by such corporation or any agent thereof relating
9to such lien. Any trust fund or similar account established by
10such corporation or agent relating to any such lien shall
11include provisions requiring such corporation or agent to apply
12such fund in satisfaction or release of such lien upon written
13demand therefor by the Department of Revenue.
14(Source: P.A. 94-893, eff. 6-20-06.)
 
15
ARTICLE 99. EFFECTIVE DATE

 
16    Section 99-999. Effective date. This Act takes effect
17January 1, 2018.