HB5243 100TH GENERAL ASSEMBLY

LRB100 16533 HLH 31665 b

100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB5243

Introduced , by Rep. Michael J. Zalewski

SYNOPSIS AS INTRODUCED:

35 ILCS 1010/1-45
35 ILCS 1010/1-50
35 ILCS 1010/1-51 new
35 ILCS 1010/1-55
35 ILCS 1010/1-63

Amends the Illinois Independent Tax Tribunal Act of 2012. Expands the jurisdiction of the Tribunal to include the County Motor Fuel Tax Law, the Live Adult Entertainment Facility Surcharge Act, the Vehicle Use Tax, the Metropolitan Pier and Exposition Authority Food and Beverage Tax, the Tire User Fee, the Chicago Soft Drink Tax, the Drycleaning Solvent Tax, the Energy Assistance Act of 1989, the Qualified Solid Waste Fee, the Illinois Hydraulic Fracturing Tax Act, or the Medical Cannabis Cultivation Privilege Tax Law. Provides for additional procedures, including automatic remand. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Independent Tax Tribunal Act of 2012 is amended by changing Sections 1-45, 1-50, 1-55, and 1-63 and by adding Section 1-51 as follows:

(35 ILCS 1010/1-45)

Sec. 1-45. Jurisdiction of the Tax Tribunal.

(a) Except as provided by the Constitution of the United States, the Constitution of the State of Illinois, or any statutes of this State, including, but not limited to, the State Officers and Employees Money Disposition Act, the Tax Tribunal shall have original jurisdiction over all determinations of the Department reflected on a Notice of Deficiency, Notice of Tax Liability, Notice of Claim Denial, or Notice of Penalty Liability issued under the Illinois Income Tax Act, the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act, the Cigarette Tax Act, the Cigarette Use Tax Act, the Tobacco Products Tax Act of 1995, the Hotel Operators' Occupation Tax Act, the Motor Fuel Tax Law, the Automobile Renting Occupation and Use Tax Act, the Coin-Operated Amusement Device and Redemption Machine Tax Act, the Gas Revenue Tax Act, the Water Company Invested Capital Tax Act, the Telecommunications Excise Tax Act, the Telecommunications Infrastructure Maintenance Fee Act, the Public Utilities Revenue Act, the Electricity Excise Tax Law, the Aircraft Use Tax Law, the Watercraft Use Tax Law, the Gas Use Tax Law, or the Uniform Penalty and Interest Act. In addition, with respect to notices issued on or after January 1, 2019, the Tax Tribunal shall also have original jurisdiction over all determinations of the Department reflected on a Notice of Deficiency, Notice of Tax Liability, Notice of Claim Denial, or Notice of Penalty Liability issued under the County Motor Fuel Tax Law, the Live Adult Entertainment Facility Surcharge Act, the Vehicle Use Tax, the Metropolitan Pier and Exposition Authority Food and Beverage Tax, the Tire User Fee, the Chicago Soft Drink Tax, the Drycleaning Solvent Tax, the Energy Assistance Act of 1989, the Qualified Solid Waste Fee, the Illinois Hydraulic Fracturing Tax Act, or the Medical Cannabis Cultivation Privilege Tax Law. Jurisdiction of the Tax Tribunal is limited to Notices of Tax Liability, Notices of Deficiency, Notices of Claim Denial, and Notices of Penalty Liability where, for notices issued prior to January 1, 2019, the amount at issue in a notice, or the aggregate amount at issue in multiple notices issued for the same tax year or audit period, exceeds $15,000, exclusive of penalties and interest. In notices issued prior to January 1, 2019 solely asserting either an interest or penalty assessment, or both, the Tax Tribunal shall have jurisdiction over cases where the combined total of all penalties or interest assessed exceeds $15,000. Beginning with notices and decisions issued on and after January 1, 2019, the Tax Tribunal shall have jurisdiction over all Notices of Tax Liability, Notices of Deficiency, Notices of Claim Denial, and Notices of Penalty Liability, all notices solely asserting either an interest or penalty assessment, and any decisions relating to the issuance or denial of an exemption ruling for any entity claiming a non-homestead exemption from any tax imposed under the Property Tax Code or any exemption from a State tax administered by the Department.

(b) Except as otherwise permitted by this Act and by the Constitution of the State of Illinois or otherwise by State law, including, but not limited to, the State Officers and Employees Money Disposition Act, no person shall contest any matter within the jurisdiction of the Tax Tribunal in any action, suit, or proceeding in the circuit court or any other court of the State. If a person attempts to do so, then such action, suit, or proceeding shall be dismissed without prejudice. The improper commencement of any action, suit, or proceeding does not extend the time period for commencing a proceeding in the Tax Tribunal.

(c) The Tax Tribunal may require the taxpayer to post a bond equal to 25% of the liability at issue (1) upon motion of the Department and a showing that (A) the taxpayer's action is frivolous or legally insufficient or (B) the taxpayer is acting primarily for the purpose of delaying the collection of tax or prejudicing the ability ultimately to collect the tax, or (2) if, at any time during the proceedings, it is determined by the Tax Tribunal that the taxpayer is not pursuing the resolution of the case with due diligence. If the Tax Tribunal finds in a particular case that the taxpayer cannot procure and furnish a satisfactory surety or sureties for the kind of bond required herein, the Tax Tribunal may relieve the taxpayer of the obligation of filing such bond, if, upon the timely application for a lien in lieu thereof and accompanying proof therein submitted, the Tax Tribunal is satisfied that any such lien imposed would operate to secure the assessment in the manner and to the degree as would a bond. The Tax Tribunal shall adopt rules for the procedures to be used in securing a bond or lien under this Section.

(d) If, with or after the filing of a timely petition, the taxpayer pays all or part of the tax or other amount in issue before the Tax Tribunal has rendered a decision, the Tax Tribunal shall treat the taxpayer's petition as a protest of a denial of claim for refund of the amount so paid upon a written motion filed by the taxpayer.

(e) The Tax Tribunal shall not have jurisdiction to review:

(1) any assessment made under the Property Tax Code;

(2) any decisions issued prior to January 1, 2019 relating to the issuance or denial of an exemption ruling for any entity claiming exemption from any tax imposed under the Property Tax Code or any State tax administered by the Department;

(3) a notice of proposed tax liability, notice of proposed deficiency, or any other notice of proposed assessment or notice of intent to take some action;

(4) any action or determination of the Department regarding tax liabilities that have become finalized by law, including but not limited to the issuance of liens, levies, and revocations, suspensions, or denials of licenses or certificates of registration or any other collection activities;

(5) any proceedings of the Department's informal administrative appeals function; and

(6) any challenge to an administrative subpoena issued by the Department.

(f) The Tax Tribunal shall decide questions regarding the constitutionality of statutes and rules adopted by the Department as applied to the taxpayer, but shall not have the power to declare a statute or rule unconstitutional or otherwise invalid on its face. A taxpayer challenging the constitutionality of a statute or rule on its face may present such challenge to the Tax Tribunal for the sole purpose of making a record for review by the Illinois Appellate Court. Failure to raise a constitutional issue regarding the application of a statute or regulations to the taxpayer shall not preclude the taxpayer or the Department from raising those issues at the appellate court level.

(Source: P.A. 97-1129, eff. 8-28-12; 98-463, eff. 8-16-13.)

(35 ILCS 1010/1-50)

Sec. 1-50. Pleadings.

(a) A taxpayer may commence a proceeding in the Tax Tribunal by filing a petition protesting the Department's determination imposing a liability for tax, penalty, or interest, or denying a claim for refund or credit application. The petition shall be filed within the time permitted by statute for filing a protest.

(b) The Department shall file its answer in the Tax Tribunal no later than 30 days after its receipt of the Tax Tribunal's notification that the taxpayer has filed a petition in the proper form or within such additional time as the Tax Tribunal may specify. The Department shall serve a copy of its answer on the taxpayer's representative or, if the taxpayer is not represented, on the taxpayer, and shall file proof of such service with the answer. Material facts alleged in the petition, if not expressly admitted or denied in the answer, shall be deemed admitted.

(c) Either party may amend a pleading once without leave at any time before the period for responding to it expires. After such time, a pleading may be amended only with the written consent of the adverse party or with the permission of the Tax Tribunal. The Tax Tribunal shall freely grant consent to amend upon such terms as may be just. Except as otherwise ordered by the Tax Tribunal, there shall be an answer to an amended pleading if an answer is required to the pleading being amended. Filing of the answer, or, if the answer has already been filed, the amended answer shall be made no later than 30 days after the filing of the amended petition. The taxpayer may not amend a petition after expiration of the time for filing a petition, if such amendment would have the effect of conferring jurisdiction on the Tax Tribunal over a matter that would otherwise not come within its jurisdiction. An amendment of a pleading shall relate back to the time of filing of the original pleading only as prescribed by Section 2-616 of the Code of Civil Procedure.

(d) For all notices issued prior to January 1, 2019, this Section applies to all cases in which the amount at issue in a notice, or the aggregate amount at issue in multiple notices issued for the same tax year or audit period, exceeds $15,000 exclusive of penalties and interest, and in all cases involving notices solely asserting an interest or penalty assessment, or both, where the combined total of all penalties and interest assessed exceeds $15,000.

(e) For all notices issued on or after January 1, 2019, this Section applies to all cases in which the amount at issue in a notice, or the aggregate amount at issue in multiple notices issued for the same tax year or audit period, exceeds $50,000, exclusive of penalties and interest, and in all cases involving notices solely asserting an interest or penalty assessment, or both, where the combined total of all penalties and interest assessed exceeds $50,000.

(Source: P.A. 97-1129, eff. 8-28-12.)

(35 ILCS 1010/1-51 new)

Sec. 1-51. Pleadings in small dollar cases.

(a) For all notices issued on or after January 1, 2019, this Section applies to all cases in which the amount at issue in a notice, or the aggregate amount at issue in multiple notices issued for the same tax year or audit period, does not exceed $50,000 exclusive of penalties and interest, in all cases involving notices solely asserting an interest or penalty assessment or both the combined total of all penalties and interest assessed does not exceed $50,000, and any decisions relating to the issuance or denial of an exemption ruling for any entity claiming a non-homestead exemption from any tax imposed under the Property Tax Code or any exemption from a State tax administered by the Department.

(b) In all matters governed by this Section, protests, in order to be deemed sufficient as a matter of law, may be filed on forms promulgated by the Tax Tribunal and must include the following at a minimum:

(1) the taxpayer's identification number, i.e., FEIN, or individual or business account number;

(2) the date of issuance of the notice which is being contested;

(3) the tax year or years and, if applicable, the filing period and audit period involved;

(4) to the extent possible, the factual and legal grounds upon which the objections to the notices are based;

(5) A certification that the facts stated are true, correct, and complete to the best of the affiant's knowledge and belief.

(35 ILCS 1010/1-55)

Sec. 1-55. Fees.

(a) The Tax Tribunal shall impose a fee of

(1) $500 for the filing of petitions under Section 1-50; or .

(2) a fee of $100 for the filing of petitions under Section 1-51 in which the amount at issue exceeds $5000 and any petition related to the issuance or denial of an exemption ruling.

(b) The Tax Tribunal may fix a fee, not in excess of the fees charged and collected by the clerk of the circuit courts, for comparing, or for preparing and comparing, a transcript of the record, or for copying any record, entry, or other paper and the comparison and certification thereof.

(c) Fees collected under this Section shall be deposited into the Illinois Independent Tax Tribunal Fund, a special fund created in the State treasury. Moneys deposited into the Fund shall be appropriated to the Tax Tribunal to reimburse the Tax Tribunal for costs associated with administering and enforcing the provisions of this Act.

(d) The Tax Tribunal shall not assign any costs or attorney's fees incurred by one party against another party. Claims for expenses and attorney's fees under Section 10-55 of the Illinois Administrative Procedure Act shall first be made to the Department of Revenue. If the claimant is dissatisfied because of the Department's failure to make any award or because of the insufficiency of the award, the claimant may petition the Court of Claims for the amount deemed owed.

(Source: P.A. 97-1129, eff. 8-28-12; 98-463, eff. 8-16-13.)

(35 ILCS 1010/1-63)

Sec. 1-63. Automatic Remand and Mediation.

(a) Every case governed by this Act shall be remanded automatically to the Department of Revenue for a period ending 90 days following the filing of the petition (the "remand period"). During the remand period, the parties shall meet and confer in good faith, making particular efforts to resolve the case by settlement, if possible. All parties may by agreement extend the remand period for an additional period approved by the administrative law judge assigned to the case, waive the remand period, or have a case returned to the Tax Tribunal at any time.

(b) At any point in the proceedings before the Tax Tribunal after the expiration of the remand period, but prior to the hearing under Section 1-65 of this Act, the parties may jointly petition the Tax Tribunal for mediation. The purpose of the mediation shall be to attempt to settle any contested issues or the case in its entirety. An administrative law judge other than the one initially assigned to hear the case shall serve as the mediator.

(Source: P.A. 97-1129, eff. 8-28-12.)

Section 99. Effective date. This Act takes effect upon becoming law.