Full Text of HB3631 99th General Assembly
HB3631 99TH GENERAL ASSEMBLY |
| | 99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016 HB3631 Introduced , by Rep. Marcus C. Evans, Jr. SYNOPSIS AS INTRODUCED: |
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Creates the Tax Preparer Consumer Bill of Rights Act. Provides that a tax preparer shall post an identification and qualification statement on his or her business premises and shall provide the customer with a receipt containing an
address and phone number at which the preparer can be contacted
throughout the year. Requires the Department of Revenue to publish a consumer bill of rights regarding tax preparers in a newspaper of general circulation in the State. Provides that tax preparers must provide certain disclosures concerning refund anticipation loans. Provides that tax preparers may not engage in certain practices, including, but not limited to, asking a taxpayer to sign a blank or incomplete tax return, misstating the tax preparer's qualifications, charging a fee based upon the amount of tax owed or refund due, and making deceptive statements. Sets forth certain requirements for tax preparers. Contains provisions concerning penalties. Contains other provisions. Effective immediately.
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| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 1. Short title. This Act may be cited as the Tax | 5 | | Preparer Consumer Bill of Rights Act. | 6 | | Section 5. Definitions. As used in this Act: | 7 | | "Department" means the Department of Revenue. | 8 | | "Refund anticipation loan"
means any loan a taxpayer may | 9 | | receive against his or her anticipated income
tax refund. | 10 | | "Tax
preparer" or "preparer" means a person, partnership, | 11 | | corporation, or other
business entity, that, for valuable | 12 | | consideration, advises or assists or offers to
advise or assist | 13 | | in the preparation of income tax returns for another. | 14 | | Section 10. Disclosure. | 15 | | (a) A tax preparer who is required, pursuant to
federal or | 16 | | State law, rule, or regulation, to sign income tax returns as a
| 17 | | preparer shall prominently and conspicuously post on the | 18 | | business premises
an identification and qualification | 19 | | statement. The statement shall include, but
is not limited to, | 20 | | the name of the tax preparer, an address and phone number
at | 21 | | which the tax preparer can be contacted throughout the year, | 22 | | and a
statement of any qualifications possessed by the tax |
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| 1 | | preparer, which may
include a statement of satisfactory | 2 | | completion of an educational or training
program in income tax | 3 | | law, theory, or practice by the preparer. The statement shall | 4 | | be displayed at the public entrance to the tax preparer's | 5 | | business premises or in the immediate area where consumers
| 6 | | arrive and are met for business purposes by the tax preparer. | 7 | | (b) Except as otherwise provided in this Section, the sign | 8 | | shall be
composed of proportionately spaced, upper-case black | 9 | | characters, sans serif, at least one-half inch high on a white | 10 | | background. | 11 | | (c) The heading "IDENTIFICATION AND QUALIFICATIONS OF TAX
| 12 | | PREPARER" shall appear at the top and center of the sign. | 13 | | Subsequent lines
shall begin at the left-hand margin of the | 14 | | sign. The first line beneath the
heading shall state the full | 15 | | name of the tax preparer. The second and third
lines shall | 16 | | state the address at which the tax preparer may be contacted
| 17 | | throughout the year. The fourth line shall state the telephone | 18 | | number at which
the tax preparer may generally be contacted | 19 | | throughout the year during
business hours. The fifth line shall | 20 | | begin with the caption
"QUALIFICATIONS:" and be followed by a | 21 | | statement of the tax preparer's
relevant training and | 22 | | experience. Such statement may consist of
characters | 23 | | one-quarter inch high. | 24 | | (d) A partnership, corporation, or other business entity | 25 | | operating as a tax
preparer may satisfy the disclosure | 26 | | requirements of this Section by posting one sign, containing |
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| 1 | | its name, address, and
phone number as set forth above, and a | 2 | | statement of the minimum
qualifications possessed by all | 3 | | individuals who prepare or assist in the
preparation of tax | 4 | | returns as an agent or employee of the partnership,
| 5 | | corporation, or other business entity. | 6 | | (e) The sign shall not contain language which falsely | 7 | | indicates that a tax
preparer is licensed or in any manner | 8 | | approved or authorized to do business
by the State. | 9 | | (f) In addition, the tax preparer shall provide the | 10 | | customer with a receipt containing an
address and phone number | 11 | | at which the preparer can be contacted
throughout the year. | 12 | | Section 15. Consumer bill of rights; notice. No later than | 13 | | the fifteenth of October of each year, the Department shall
| 14 | | publish in a newspaper of general circulation in the State a | 15 | | statement of
consumers' rights and laws concerning tax | 16 | | preparers to be called a "consumer
bill of rights regarding tax | 17 | | preparers". The notice shall contain the following | 18 | | information: | 19 | | (1) postings required by local, State, and federal | 20 | | laws, such as price posting,
posting of qualifications, and | 21 | | any licenses and permits required for the
operation of the | 22 | | business; | 23 | | (2) explanations of some of the commonly offered | 24 | | services and industry
jargon, such as preparation of short | 25 | | and long federal forms, refund, electronic
filing, express |
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| 1 | | mail, direct deposit, refund anticipation loan, "quick", | 2 | | "instant", "rapid", "fast", fee, and interest; | 3 | | (3) basic information on what a tax preparer is and is | 4 | | not required to do for
a consumer, such as the preparer's | 5 | | responsibility to sign a return, and that a tax preparer | 6 | | may not be required to accompany a consumer to an audit; | 7 | | (4) the telephone numbers of the Department for | 8 | | information and
complaints; and | 9 | | (5) a statement listing the types of information that | 10 | | the consumer has the right to receive from the tax preparer | 11 | | prior to becoming obligated to compensate
the tax preparer | 12 | | for services rendered in connection with filing the
| 13 | | consumer's income tax return with the appropriate | 14 | | governmental agencies. | 15 | | In addition, the Department shall provide a copy of the | 16 | | consumer bill of rights regarding tax
preparers to any | 17 | | requesting individuals or businesses within 14 days of
such a | 18 | | request. | 19 | | Section 20. Records. No tax preparer shall intentionally | 20 | | misstate or
misrepresent any information relating to his or her | 21 | | education, training, or
experience on an identification and | 22 | | qualification statement. A tax preparer
shall maintain records | 23 | | to substantiate all of the information contained on such
a | 24 | | statement; provided, however, that an affidavit signed by the | 25 | | tax preparer indicating that the information contained on a |
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| 1 | | statement is true shall be
sufficient to substantiate any | 2 | | information if other records are not available.
Such records, | 3 | | affidavit, or both shall be kept on file on the business | 4 | | premises
and shall be presented on demand for inspection by the | 5 | | commissioner. | 6 | | Section 25. Refund anticipation loans. Any tax preparer who
| 7 | | advertises the availability of a refund anticipation loan may | 8 | | not directly or
indirectly represent such a loan as a refund. | 9 | | Any advertisement which
mentions a refund anticipation loan | 10 | | must state conspicuously that it is a loan
and that a fee or | 11 | | interest will be charged by the lending institution. The
| 12 | | advertisement must also disclose the name of the lending | 13 | | institution. | 14 | | Before any taxpayer enters into a refund anticipation loan, | 15 | | the tax
preparer facilitating the loan shall provide the | 16 | | following disclosure to the
taxpayer in writing, in English and | 17 | | Spanish, in at least 14-point type. In the
event that the | 18 | | taxpayer does not understand English or Spanish, the tax
| 19 | | preparer shall also provide a point-by-point oral explanation | 20 | | of the following
required disclosure in a language understood | 21 | | by the taxpayer: | 22 | | "YOU ARE NOT REQUIRED TO ENTER INTO THIS REFUND
| 23 | | ANTICIPATION LOAN AGREEMENT MERELY BECAUSE YOU HAVE
RECEIVED | 24 | | THIS INFORMATION. | 25 | | IF YOU DO SIGN A CONTRACT FOR A REFUND ANTICIPATION
LOAN, |
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| 1 | | YOU WILL BE TAKING OUT A LOAN. YOU WILL BE RESPONSIBLE
FOR | 2 | | REPAYMENT OF THE ENTIRE LOAN AMOUNT AND ALL RELATED
COSTS AND | 3 | | FEES, REGARDLESS OF HOW MUCH MONEY YOU
ACTUALLY RECEIVE IN YOUR | 4 | | TAX REFUND. | 5 | | IF YOU DO NOT TAKE OUT THIS REFUND ANTICIPATION LOAN,
YOU | 6 | | ARE ELIGIBLE TO RECEIVE A GROSS TAX REFUND OF
APPROXIMATELY | 7 | | $(insert amount). | 8 | | IF YOU DO TAKE OUT THIS REFUND ANTICIPATION LOAN, YOU
WILL | 9 | | BE RESPONSIBLE TO PAY $(insert amount) IN FEES FOR THE
LOAN. | 10 | | AFTER THESE FEES ARE PAID, YOU WILL RECEIVE
APPROXIMATELY | 11 | | $(insert amount) AS YOUR LOAN. | 12 | | THE ESTIMATED ANNUAL PERCENTAGE RATE OF YOUR REFUND
| 13 | | ANTICIPATION LOAN IS (insert percentage). THIS IS BASED ON THE
| 14 | | ACTUAL AMOUNT OF TIME YOU WILL BE LENT MONEY THROUGH THIS | 15 | | REFUND ANTICIPATION LOAN. | 16 | | IF YOU DO TAKE OUT THIS REFUND ANTICIPATION LOAN, YOU
CAN | 17 | | EXPECT TO RECEIVE YOUR LOAN ON (insert date). | 18 | | IF YOU DO NOT TAKE OUT THIS REFUND ANTICIPATION LOAN,
YOU | 19 | | CAN STILL RECEIVE YOUR TAX REFUND QUICKLY. IF YOU FILE
YOUR TAX | 20 | | RETURN ELECTRONICALLY AND RECEIVE YOUR TAX
REFUND THROUGH THE | 21 | | MAIL, YOU CAN EXPECT TO RECEIVE YOUR
REFUND ON (insert date). | 22 | | IF YOU FILE YOUR TAX RETURN ELECTRONICALLY AND HAVE
YOUR TAX | 23 | | REFUND DIRECTLY DEPOSITED INTO A BANK ACCOUNT,
YOU CAN EXPECT | 24 | | TO RECEIVE YOUR REFUND ON (insert date).". | 25 | | It shall be the obligation of the tax preparer to complete | 26 | | the required
disclosure accurately with all relevant |
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| 1 | | information for each taxpayer, to
provide the required | 2 | | point-by-point oral explanation when necessary, and to
ensure | 3 | | that the completed disclosure form is signed by the taxpayer | 4 | | before he
or she enters into a refund anticipation loan. | 5 | | Any person claiming to be injured by
the failure of a tax | 6 | | preparer to act in accordance with this Section shall have a | 7 | | cause of action against such tax preparer in any court
of | 8 | | competent jurisdiction for any or all of the following relief: | 9 | | (1) compensatory and punitive damages; | 10 | | (2) injunctive and declaratory relief; | 11 | | (3) attorneys' fees and costs; and | 12 | | (4) such other relief as the court may deem | 13 | | appropriate. | 14 | | Section 30. Exceptions. This Act does not apply to: | 15 | | (1) An officer or employee of a corporation or business | 16 | | enterprise who, in
his or her capacity as such, advises or | 17 | | assists in the preparation of income tax returns relating | 18 | | to such corporation or business enterprise. | 19 | | (2) An attorney who advises or assists in the | 20 | | preparation of income tax returns in the practice of law | 21 | | and the employees of that attorney. | 22 | | (3) A fiduciary and the employees thereof who advised | 23 | | or assist in the
preparation of income tax returns on | 24 | | behalf of the fiduciary estate, the
testator, trustee, | 25 | | grantor or beneficiaries thereof. |
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| 1 | | (4) A certified public accountant and the employees | 2 | | thereof. | 3 | | (5) An employee of a governmental unit, agency, or | 4 | | instrumentality who
advises or assists in the preparation | 5 | | of income tax returns in the performance of his or her | 6 | | official duties. | 7 | | (6) An agent enrolled to practice before the Internal | 8 | | Revenue Service. | 9 | | Section 40. Tax preparation; practices. | 10 | | (a) Tax preparers may not: | 11 | | (1) ask a taxpayer to sign a blank or incomplete tax | 12 | | return; | 13 | | (2) misrepresent their qualifications; | 14 | | (3) reveal any information appearing on a tax return or | 15 | | any information
gathered for its preparation, including | 16 | | the fact of preparation and the content
of solicitation | 17 | | lists, to any person or business other than: | 18 | | (A) the taxpayer; | 19 | | (B) a person designated in writing by the taxpayer; | 20 | | or | 21 | | (C) anyone authorized to receive such information | 22 | | by court order or by law; | 23 | | (4) make any deceptive statement designed to persuade | 24 | | taxpayers to use,
or not to use, a tax preparer; | 25 | | (5) induce or attempt to induce a taxpayer to violate |
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| 1 | | any governmental law,
rule, or regulation; | 2 | | (6) use the word "accountant" in any advertisement | 3 | | unless at least one
Certified Public Accountant or Public | 4 | | Accountant is present at each tax
preparing location during | 5 | | all business hours. The accountant or accountants employed | 6 | | at
that location must exercise control over all tax returns | 7 | | prepared at that location; | 8 | | (7) use the term "expert", "master", "consultant", | 9 | | "specialist", or any similar
terms in an advertisement | 10 | | unless the tax preparer's relevant education or
experience | 11 | | is also disclosed in the advertisement and there is a
| 12 | | reasonable basis for any claims of expertise; | 13 | | (8) alter a tax return after it has been signed by the | 14 | | taxpayer, without the
taxpayer's written consent; or | 15 | | (9) charge a fee based upon the amount of tax owed or | 16 | | refund due. | 17 | | (b) Tax preparers that advertise their tax preparation
| 18 | | services in a manner designed to reach the general public must | 19 | | post the following information clearly and conspicuously in | 20 | | each office: | 21 | | (1) exactly how their fees are computed; if there is a | 22 | | minimum fee for
preparing a return, it must be disclosed; | 23 | | if the fee is variable, the factors upon
which the | 24 | | variation depends must be disclosed; | 25 | | (2) that the taxpayer is entitled to receive a copy of | 26 | | his or her tax return at the time the original is given to |
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| 1 | | the taxpayer for filing; | 2 | | (3) that both the tax preparer and the taxpayer must | 3 | | sign every tax return; | 4 | | (4) that the tax preparer is not a certified public
| 5 | | accountant or a licensed attorney in Illinois, if such | 6 | | information is true; and | 7 | | (5) that the tax preparer or an agent will not | 8 | | represent the taxpayer at any
audit, if such information is | 9 | | true; for the purposes of this item (5), "represent" means | 10 | | to appear before any government
tax administering | 11 | | authority as an attorney, certified public accountant, or | 12 | | enrolled
agent; failure to make this disclosure means that | 13 | | the tax preparer agrees to represent the taxpayer or to | 14 | | provide representation. | 15 | | (c) Tax preparers must: | 16 | | (1) sign every tax return prepared; | 17 | | (2) give a copy the tax return to the taxpayer at the | 18 | | time the
original tax return is given to the taxpayer for | 19 | | filing; | 20 | | (3) provide the taxpayer with a statement of the | 21 | | charges for each tax return
or schedule prepared; and | 22 | | (4) return any of the taxpayer's personal papers upon | 23 | | request, when the
original tax return is given to the | 24 | | taxpayer for filing, unless specifically
permitted to | 25 | | retain those papers under State law. | 26 | | (d) Tax preparers may not: |
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| 1 | | (1) guarantee a tax refund or guarantee that the | 2 | | taxpayer will not be
audited by any government tax agency; | 3 | | (2) request a taxpayer to assign to the preparer any | 4 | | portion of the refund
due; | 5 | | (3) use their addresses on a tax return as the place to | 6 | | which a refund
should be mailed, unless the taxpayer has | 7 | | signed a power of attorney
containing such authorization; a | 8 | | fiduciary with authority to handle a taxpayer's
financial | 9 | | matters is not required to obtain this power of attorney; | 10 | | or | 11 | | (4) claim to give taxpayers an "instant tax refund" | 12 | | that is actually an
interest-bearing loan unless that fact | 13 | | is disclosed to the taxpayer in accordance with federal and | 14 | | State law. | 15 | | (e) Each tax preparer shall retain a copy of every tax | 16 | | return
prepared for a period of at least 3 years from the | 17 | | preparation date or the
due date of the return, whichever is | 18 | | later. | 19 | | (f) All disclosures required by this Section
must be made | 20 | | in English and in any other language which the tax preparer
| 21 | | uses to attract customers. | 22 | | (g) Any individual or business which prepares income tax
| 23 | | returns as an adjunct service to year-round fiduciary | 24 | | activities provided in the
regular course of business for its | 25 | | customers is exempt from this Section. If the
business also | 26 | | offers individual tax return preparation services which are not
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| 1 | | related to such fiduciary activities, this Section applies to | 2 | | those services. | 3 | | Section 45. Penalties. Any person, partnership, | 4 | | corporation, or other
business entity who violates any | 5 | | provision of this Act
rules adopted under this Act shall be | 6 | | liable for a civil penalty of not less
than $250 nor more than | 7 | | $500 for the first
violation and for each succeeding violation | 8 | | a civil penalty of not less than $500 nor more than $750.
| 9 | | Section 99. Effective date. This Act takes effect upon | 10 | | becoming law.
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