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90_SB0856enr
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Amends the Civil Administrative Code to allow the
Department of Revenue, upon certification of past due child
support, to collect the delinquency in any manner authorized
for the collection of any tax administered by the Department
(now only delinquent personal income tax). Amends the State
Finance Act to provide that a retail sale by a producer of
coal or other mineral is a sale at retail where it is
extracted from the earth. Amends the Illinois Income Tax Act.
In the definition of base income, deletes real estate
investment trusts from the language concerning the
modification of taxable income for a corporation. Provides
that in the case of a trust, unspecified items of income or
deductions taken into account in computing base income and
not otherwise allocated shall be allocated to the State if
the taxpayer had commercial domicile in the State when the
item was paid, incurred, or accrued (now shall not be
allocated to State). Amends the Use Tax Act, the Service Use
Tax Act, the Service Occupation Tax Act, and the Retailers'
Occupation Tax Act to require that a protest to the Notice of
Tentative Determination of Claim be filed within 60 days (now
20 days). Amends the Cigarette Tax Act, the Cigarette Use Tax
Act, the Messages Tax Act, the Gas Revenue Tax Act, the
Public Utilities Revenue Act, the Water Company Invested
Capital Tax Act, and the Telecommunications Excise Tax Act to
provide that if both the Department and the taxpayer have
agreed to an extension of time to issue a notice of tax
liability, a claim for credit or refund may be filed at any
time prior to the expiration of the agreed upon period.
Amends the Senior Citizens and Disabled Persons Property Tax
Relief and Pharmaceutical Assistance Act to include in the
list of factors used to determine "income" an amount equal to
any net operating loss carryover deduction or capital loss
carryover deduction taken during the taxable year. Makes
other changes. Effective immediately.
LRB9000732KDcbA
SB856 Enrolled LRB9000732KDcbA
1 AN ACT in relation to taxes, amending named Acts.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The Civil Administrative Code of Illinois is
5 amended by changing Section 39b52 and adding 39b53 as
6 follows:
7 (20 ILCS 2505/39b52)
8 Sec. 39b52. Collection of past due support. Upon
9 certification of past due child support amounts from the
10 Department of Public Aid, the Department of Revenue may
11 collect the delinquency in any manner authorized for the
12 collection of any tax administered by the Department of
13 Revenue a delinquent personal income tax liability. The
14 Department of Revenue shall notify the Department of Public
15 Aid when the delinquency or any portion of the delinquency
16 has been collected under this Section. Any child support
17 delinquency collected by the Department of Revenue, including
18 those amounts that result in overpayment of a child support
19 delinquency, shall be deposited in, or transferred to, the
20 Child Support Enforcement Trust Fund. The Department of
21 Revenue may implement this Section through the use of
22 emergency rules in accordance with Section 5-45 of the
23 Illinois Administrative Procedure Act. For purposes of the
24 Illinois Administrative Procedure Act, the adoption of rules
25 to implement this Section shall be considered an emergency
26 and necessary for the public interest, safety, and welfare.
27 (Source: P.A. 89-6, eff. 12-31-95.)
28 (20 ILCS 2505/39b53 new)
29 Sec. 39b53. Income Tax Reciprocal Agreements.
30 (a) Reciprocal agreement cost study. The Department of
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1 Revenue shall study the use and cost effectiveness of all
2 reciprocal agreements entered into under the authority of
3 Sections 302 and 701 of the Illinois Income Tax Act. The
4 Department shall report to the General Assembly as to the
5 fiscal impact on Illinois income tax collections of each of
6 the reciprocal agreements by January 1, 1999 and every 5
7 years thereafter. The Department of Revenue shall have the
8 authority to require that employers provide all information
9 necessary to complete the study on income tax withholding
10 returns filed with the Department under Section 704 of the
11 Illinois Income Tax Act. The Department shall have the
12 authority to require that employees provide all information
13 necessary to complete the study on individual income tax
14 returns filed under Section 502 of the Illinois Income Tax
15 Act.
16 (b) Revocation of reciprocal agreements. Upon receipt
17 of the cost study or at any time thereafter, the General
18 Assembly may adopt a joint resolution by an affirmative vote
19 of a majority of each house directing the Director of Revenue
20 to revoke any reciprocal agreement with any other state that
21 results in a loss of revenue to the State of Illinois. Any
22 joint resolution shall specify the date upon which the
23 reciprocal agreement is to be revoked, which date shall be no
24 sooner than the beginning of the next subsequent calendar
25 year that is at least 6 months after the adoption of the
26 joint resolution.
27 (c) Authority to enter into compensation agreements.
28 Before any revocation by joint resolution adopted by the
29 General Assembly under subsection (b), the Director of
30 Revenue shall have the authority to enter into a compensation
31 or rebating agreement with any reciprocal state. Any
32 compensation agreement shall provide that the reciprocal
33 state shall provide a rebate to the State of Illinois to
34 compensate for the loss of revenue. The Director of Revenue
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1 shall have the authority to enter into agreements with
2 reciprocal states to contract with any third party mutually
3 agreed to by the Director and the reciprocal state to
4 establish a rebate or compensation amount.
5 Section 10. The State Finance Act is amended by changing
6 Sections 6z-18 and 6z-20 as follows:
7 (30 ILCS 105/6z-18) (from Ch. 127, par. 142z-18)
8 Sec. 6z-18. A portion of the money paid into the Local
9 Government Tax Fund from sales of food for human consumption
10 which is to be consumed off the premises where it is sold
11 (other than alcoholic beverages, soft drinks and food which
12 has been prepared for immediate consumption) and prescription
13 and nonprescription medicines, drugs, medical appliances and
14 insulin, urine testing materials, syringes and needles used
15 by diabetics, which occurred in municipalities, shall be
16 distributed to each municipality based upon the sales which
17 occurred in that municipality. The remainder shall be
18 distributed to each county based upon the sales which
19 occurred in the unincorporated area of that county.
20 A portion of the money paid into the Local Government Tax
21 Fund from the 6.25% general use tax rate on the selling price
22 of tangible personal property which is purchased outside
23 Illinois at retail from a retailer and which is titled or
24 registered by any agency of this State's government shall be
25 distributed to municipalities as provided in this paragraph.
26 Each municipality shall receive the amount attributable to
27 sales for which Illinois addresses for titling or
28 registration purposes are given as being in such
29 municipality. The remainder of the money paid into the Local
30 Government Tax Fund from such sales shall be distributed to
31 counties. Each county shall receive the amount attributable
32 to sales for which Illinois addresses for titling or
SB856 Enrolled -4- LRB9000732KDcbA
1 registration purposes are given as being located in the
2 unincorporated area of such county.
3 A portion of the money paid into the Local Government Tax
4 Fund from the 6.25% general rate on sales subject to taxation
5 under the Retailers' Occupation Tax Act and the Service
6 Occupation Tax Act, which occurred in municipalities, shall
7 be distributed to each municipality, based upon the sales
8 which occurred in that municipality. The remainder shall be
9 distributed to each county, based upon the sales which
10 occurred in the unincorporated area of such county.
11 For the purpose of determining allocation to the local
12 government unit, a retail sale by a producer of coal or other
13 mineral mined in Illinois is a sale at retail at the place
14 where the coal or other mineral mined in Illinois is
15 extracted from the earth. This paragraph does not apply to
16 coal or other mineral when it is delivered or shipped by the
17 seller to the purchaser at a point outside Illinois so that
18 the sale is exempt under the United States Constitution as a
19 sale in interstate or foreign commerce.
20 Whenever the Department determines that a refund of money
21 paid into the Local Government Tax Fund should be made to a
22 claimant instead of issuing a credit memorandum, the
23 Department shall notify the State Comptroller, who shall
24 cause the order to be drawn for the amount specified, and to
25 the person named, in such notification from the Department.
26 Such refund shall be paid by the State Treasurer out of the
27 Local Government Tax Fund.
28 On or before the 25th day of each calendar month, the
29 Department shall prepare and certify to the Comptroller the
30 disbursement of stated sums of money to named municipalities
31 and counties, the municipalities and counties to be those
32 entitled to distribution of taxes or penalties paid to the
33 Department during the second preceding calendar month. The
34 amount to be paid to each municipality or county shall be the
SB856 Enrolled -5- LRB9000732KDcbA
1 amount (not including credit memoranda) collected during the
2 second preceding calendar month by the Department and paid
3 into the Local Government Tax Fund, plus an amount the
4 Department determines is necessary to offset any amounts
5 which were erroneously paid to a different taxing body, and
6 not including an amount equal to the amount of refunds made
7 during the second preceding calendar month by the Department,
8 and not including any amount which the Department determines
9 is necessary to offset any amounts which are payable to a
10 different taxing body but were erroneously paid to the
11 municipality or county. Within 10 days after receipt, by the
12 Comptroller, of the disbursement certification to the
13 municipalities and counties, provided for in this Section to
14 be given to the Comptroller by the Department, the
15 Comptroller shall cause the orders to be drawn for the
16 respective amounts in accordance with the directions
17 contained in such certification.
18 When certifying the amount of monthly disbursement to a
19 municipality or county under this Section, the Department
20 shall increase or decrease that amount by an amount necessary
21 to offset any misallocation of previous disbursements. The
22 offset amount shall be the amount erroneously disbursed
23 within the 6 months preceding the time a misallocation is
24 discovered.
25 The provisions directing the distributions from the
26 special fund in the State Treasury provided for in this
27 Section shall constitute an irrevocable and continuing
28 appropriation of all amounts as provided herein. The State
29 Treasurer and State Comptroller are hereby authorized to make
30 distributions as provided in this Section.
31 In construing any development, redevelopment, annexation,
32 preannexation or other lawful agreement in effect prior to
33 September 1, 1990, which describes or refers to receipts from
34 a county or municipal retailers' occupation tax, use tax or
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1 service occupation tax which now cannot be imposed, such
2 description or reference shall be deemed to include the
3 replacement revenue for such abolished taxes, distributed
4 from the Local Government Tax Fund.
5 (Source: P.A. 86-928; 86-1481.)
6 (30 ILCS 105/6z-20) (from Ch. 127, par. 142z-20)
7 Sec. 6z-20. Of the money received from the 6.25% general
8 rate on sales subject to taxation under the Retailers'
9 Occupation Tax Act and Service Occupation Tax Act and paid
10 into the County and Mass Transit District Fund, distribution
11 to the Regional Transportation Authority tax fund, created
12 pursuant to Section 4.03 of the Regional Transportation
13 Authority Act, for deposit therein shall be made based upon
14 the retail sales occurring in a county having more than
15 3,000,000 inhabitants. The remainder shall be distributed to
16 each county having 3,000,000 or fewer inhabitants based upon
17 the retail sales occurring in each such county.
18 For the purpose of determining allocation to the local
19 government unit, a retail sale by a producer of coal or other
20 mineral mined in Illinois is a sale at retail at the place
21 where the coal or other mineral mined in Illinois is
22 extracted from the earth. This paragraph does not apply to
23 coal or other mineral when it is delivered or shipped by the
24 seller to the purchaser at a point outside Illinois so that
25 the sale is exempt under the United States Constitution as a
26 sale in interstate or foreign commerce.
27 Of the money received from the 6.25% general use tax rate
28 on tangible personal property which is purchased outside
29 Illinois at retail from a retailer and which is titled or
30 registered by any agency of this State's government and paid
31 into the County and Mass Transit District Fund, the amount
32 for which Illinois addresses for titling or registration
33 purposes are given as being in each county having more than
SB856 Enrolled -7- LRB9000732KDcbA
1 3,000,000 inhabitants shall be distributed into the Regional
2 Transportation Authority tax fund, created pursuant to
3 Section 4.03 of the Regional Transportation Authority Act.
4 The remainder of the money paid from such sales shall be
5 distributed to each county based on sales for which Illinois
6 addresses for titling or registration purposes are given as
7 being located in the county. Any money paid into the
8 Regional Transportation Authority Occupation and Use Tax
9 Replacement Fund from the County and Mass Transit District
10 Fund prior to January 14, 1991, which has not been paid to
11 the Authority prior to that date, shall be transferred to the
12 Regional Transportation Authority tax fund.
13 Whenever the Department determines that a refund of money
14 paid into the County and Mass Transit District Fund should be
15 made to a claimant instead of issuing a credit memorandum,
16 the Department shall notify the State Comptroller, who shall
17 cause the order to be drawn for the amount specified, and to
18 the person named, in such notification from the Department.
19 Such refund shall be paid by the State Treasurer out of the
20 County and Mass Transit District Fund.
21 On or before the 25th day of each calendar month, the
22 Department shall prepare and certify to the Comptroller the
23 disbursement of stated sums of money to the Regional
24 Transportation Authority and to named counties, the counties
25 to be those entitled to distribution, as hereinabove
26 provided, of taxes or penalties paid to the Department during
27 the second preceding calendar month. The amount to be paid
28 to the Regional Transportation Authority and each county
29 having 3,000,000 or fewer inhabitants shall be the amount
30 (not including credit memoranda) collected during the second
31 preceding calendar month by the Department and paid into the
32 County and Mass Transit District Fund, plus an amount the
33 Department determines is necessary to offset any amounts
34 which were erroneously paid to a different taxing body, and
SB856 Enrolled -8- LRB9000732KDcbA
1 not including an amount equal to the amount of refunds made
2 during the second preceding calendar month by the Department,
3 and not including any amount which the Department determines
4 is necessary to offset any amounts which were payable to a
5 different taxing body but were erroneously paid to the
6 Regional Transportation Authority or county. Within 10 days
7 after receipt, by the Comptroller, of the disbursement
8 certification to the Regional Transportation Authority and
9 counties, provided for in this Section to be given to the
10 Comptroller by the Department, the Comptroller shall cause
11 the orders to be drawn for the respective amounts in
12 accordance with the directions contained in such
13 certification.
14 When certifying the amount of a monthly disbursement to
15 the Regional Transportation Authority or to a county under
16 this Section, the Department shall increase or decrease that
17 amount by an amount necessary to offset any misallocation of
18 previous disbursements. The offset amount shall be the
19 amount erroneously disbursed within the 6 months preceding
20 the time a misallocation is discovered.
21 The provisions directing the distributions from the
22 special fund in the State Treasury provided for in this
23 Section and from the Regional Transportation Authority tax
24 fund created by Section 4.03 of the Regional Transportation
25 Authority Act shall constitute an irrevocable and continuing
26 appropriation of all amounts as provided herein. The State
27 Treasurer and State Comptroller are hereby authorized to make
28 distributions as provided in this Section.
29 In construing any development, redevelopment, annexation,
30 preannexation or other lawful agreement in effect prior to
31 September 1, 1990, which describes or refers to receipts from
32 a county or municipal retailers' occupation tax, use tax or
33 service occupation tax which now cannot be imposed, such
34 description or reference shall be deemed to include the
SB856 Enrolled -9- LRB9000732KDcbA
1 replacement revenue for such abolished taxes, distributed
2 from the County and Mass Transit District Fund or Local
3 Government Distributive Fund, as the case may be.
4 (Source: P.A. 86-928; 86-1481; 87-435.)
5 Section 15. The Illinois Income Tax Act is amended by
6 changing Sections 203, 301, 302, 506, 701, 905, 911, and 917
7 and adding Section 806 as follows:
8 (35 ILCS 5/203) (from Ch. 120, par. 2-203)
9 Sec. 203. Base income defined.
10 (a) Individuals.
11 (1) In general. In the case of an individual, base
12 income means an amount equal to the taxpayer's adjusted
13 gross income for the taxable year as modified by
14 paragraph (2).
15 (2) Modifications. The adjusted gross income
16 referred to in paragraph (1) shall be modified by adding
17 thereto the sum of the following amounts:
18 (A) An amount equal to all amounts paid or
19 accrued to the taxpayer as interest or dividends
20 during the taxable year to the extent excluded from
21 gross income in the computation of adjusted gross
22 income, except stock dividends of qualified public
23 utilities described in Section 305(e) of the
24 Internal Revenue Code;
25 (B) An amount equal to the amount of tax
26 imposed by this Act to the extent deducted from
27 gross income in the computation of adjusted gross
28 income for the taxable year;
29 (C) An amount equal to the amount received
30 during the taxable year as a recovery or refund of
31 real property taxes paid with respect to the
32 taxpayer's principal residence under the Revenue Act
SB856 Enrolled -10- LRB9000732KDcbA
1 of 1939 and for which a deduction was previously
2 taken under subparagraph (L) of this paragraph (2)
3 prior to July 1, 1991, the retrospective application
4 date of Article 4 of Public Act 87-17. In the case
5 of multi-unit or multi-use structures and farm
6 dwellings, the taxes on the taxpayer's principal
7 residence shall be that portion of the total taxes
8 for the entire property which is attributable to
9 such principal residence;
10 (D) An amount equal to the amount of the
11 capital gain deduction allowable under the Internal
12 Revenue Code, to the extent deducted from gross
13 income in the computation of adjusted gross income;
14 and
15 (D-5) An amount, to the extent not included in
16 adjusted gross income, equal to the amount of money
17 withdrawn by the taxpayer in the taxable year from a
18 medical care savings account and the interest earned
19 on the account in the taxable year of a withdrawal
20 pursuant to subsection (b) of Section 20 of the
21 Medical Care Savings Account Act;
22 and by deducting from the total so obtained the sum of
23 the following amounts:
24 (E) Any amount included in such total in
25 respect of any compensation (including but not
26 limited to any compensation paid or accrued to a
27 serviceman while a prisoner of war or missing in
28 action) paid to a resident by reason of being on
29 active duty in the Armed Forces of the United States
30 and in respect of any compensation paid or accrued
31 to a resident who as a governmental employee was a
32 prisoner of war or missing in action, and in respect
33 of any compensation paid to a resident in 1971 or
34 thereafter for annual training performed pursuant to
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1 Sections 502 and 503, Title 32, United States Code
2 as a member of the Illinois National Guard;
3 (F) An amount equal to all amounts included in
4 such total pursuant to the provisions of Sections
5 402(a), 402(c), 403(a), 403(b), 406(a), 407(a), and
6 408 of the Internal Revenue Code, or included in
7 such total as distributions under the provisions of
8 any retirement or disability plan for employees of
9 any governmental agency or unit, or retirement
10 payments to retired partners, which payments are
11 excluded in computing net earnings from self
12 employment by Section 1402 of the Internal Revenue
13 Code and regulations adopted pursuant thereto;
14 (G) The valuation limitation amount;
15 (H) An amount equal to the amount of any tax
16 imposed by this Act which was refunded to the
17 taxpayer and included in such total for the taxable
18 year;
19 (I) An amount equal to all amounts included in
20 such total pursuant to the provisions of Section 111
21 of the Internal Revenue Code as a recovery of items
22 previously deducted from adjusted gross income in
23 the computation of taxable income;
24 (J) An amount equal to those dividends
25 included in such total which were paid by a
26 corporation which conducts business operations in an
27 Enterprise Zone or zones created under the Illinois
28 Enterprise Zone Act, and conducts substantially all
29 of its operations in an Enterprise Zone or zones;
30 (K) An amount equal to those dividends
31 included in such total that were paid by a
32 corporation that conducts business operations in a
33 federally designated Foreign Trade Zone or Sub-Zone
34 and that is designated a High Impact Business
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1 located in Illinois; provided that dividends
2 eligible for the deduction provided in subparagraph
3 (J) of paragraph (2) of this subsection shall not be
4 eligible for the deduction provided under this
5 subparagraph (K);
6 (L) For taxable years ending after December
7 31, 1983, an amount equal to all social security
8 benefits and railroad retirement benefits included
9 in such total pursuant to Sections 72(r) and 86 of
10 the Internal Revenue Code;
11 (M) With the exception of any amounts
12 subtracted under subparagraph (N), an amount equal
13 to the sum of all amounts disallowed as deductions
14 by Sections 171(a) (2), and 265(2) of the Internal
15 Revenue Code of 1954, as now or hereafter amended,
16 and all amounts of expenses allocable to interest
17 and disallowed as deductions by Section 265(1) of
18 the Internal Revenue Code of 1954, as now or
19 hereafter amended;
20 (N) An amount equal to all amounts included in
21 such total which are exempt from taxation by this
22 State either by reason of its statutes or
23 Constitution or by reason of the Constitution,
24 treaties or statutes of the United States; provided
25 that, in the case of any statute of this State that
26 exempts income derived from bonds or other
27 obligations from the tax imposed under this Act, the
28 amount exempted shall be the interest net of bond
29 premium amortization;
30 (O) An amount equal to any contribution made
31 to a job training project established pursuant to
32 the Tax Increment Allocation Redevelopment Act;
33 (P) An amount equal to the amount of the
34 deduction used to compute the federal income tax
SB856 Enrolled -13- LRB9000732KDcbA
1 credit for restoration of substantial amounts held
2 under claim of right for the taxable year pursuant
3 to Section 1341 of the Internal Revenue Code of
4 1986;
5 (Q) An amount equal to any amounts included in
6 such total, received by the taxpayer as an
7 acceleration in the payment of life, endowment or
8 annuity benefits in advance of the time they would
9 otherwise be payable as an indemnity for a terminal
10 illness;
11 (R) An amount equal to the amount of any
12 federal or State bonus paid to veterans of the
13 Persian Gulf War;
14 (S) An amount, to the extent included in
15 adjusted gross income, equal to the amount of a
16 contribution made in the taxable year on behalf of
17 the taxpayer to a medical care savings account
18 established under the Medical Care Savings Account
19 Act to the extent the contribution is accepted by
20 the account administrator as provided in that Act;
21 (T) An amount, to the extent included in
22 adjusted gross income, equal to the amount of
23 interest earned in the taxable year on a medical
24 care savings account established under the Medical
25 Care Savings Account Act on behalf of the taxpayer,
26 other than interest added pursuant to item (D-5) of
27 this paragraph (2);
28 (U) For one taxable year beginning on or after
29 January 1, 1994, an amount equal to the total amount
30 of tax imposed and paid under subsections (a) and
31 (b) of Section 201 of this Act on grant amounts
32 received by the taxpayer under the Nursing Home
33 Grant Assistance Act during the taxpayer's taxable
34 years 1992 and 1993; and
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1 (V) Beginning with tax years ending on or
2 after December 31, 1995 and ending with tax years
3 ending on or before December 31, 1999, an amount
4 equal to the amount paid by a taxpayer who is a
5 self-employed taxpayer, a partner of a partnership,
6 or a shareholder in a Subchapter S corporation for
7 health insurance or long-term care insurance for
8 that taxpayer or that taxpayer's spouse or
9 dependents, to the extent that the amount paid for
10 that health insurance or long-term care insurance
11 may be deducted under Section 213 of the Internal
12 Revenue Code of 1986, has not been deducted on the
13 federal income tax return of the taxpayer, and does
14 not exceed the taxable income attributable to that
15 taxpayer's income, self-employment income, or
16 Subchapter S corporation income; except that no
17 deduction shall be allowed under this item (V) if
18 the taxpayer is eligible to participate in any
19 health insurance or long-term care insurance plan of
20 an employer of the taxpayer or the taxpayer's
21 spouse. The amount of the health insurance and
22 long-term care insurance subtracted under this item
23 (V) shall be determined by multiplying total health
24 insurance and long-term care insurance premiums paid
25 by the taxpayer times a number that represents the
26 fractional percentage of eligible medical expenses
27 under Section 213 of the Internal Revenue Code of
28 1986 not actually deducted on the taxpayer's federal
29 income tax return.
30 (b) Corporations.
31 (1) In general. In the case of a corporation, base
32 income means an amount equal to the taxpayer's taxable
33 income for the taxable year as modified by paragraph (2).
34 (2) Modifications. The taxable income referred to
SB856 Enrolled -15- LRB9000732KDcbA
1 in paragraph (1) shall be modified by adding thereto the
2 sum of the following amounts:
3 (A) An amount equal to all amounts paid or
4 accrued to the taxpayer as interest and all
5 distributions received from regulated investment
6 companies during the taxable year to the extent
7 excluded from gross income in the computation of
8 taxable income;
9 (B) An amount equal to the amount of tax
10 imposed by this Act to the extent deducted from
11 gross income in the computation of taxable income
12 for the taxable year;
13 (C) In the case of a regulated investment
14 company or real estate investment trust, an amount
15 equal to the excess of (i) the net long-term capital
16 gain for the taxable year, over (ii) the amount of
17 the capital gain dividends designated as such in
18 accordance with Section 852(b)(3)(C) or Section
19 857(b)(3)(C) of the Internal Revenue Code and any
20 amount designated under Section 852(b)(3)(D) of the
21 Internal Revenue Code, attributable to the taxable
22 year.
23 This amendatory Act of 1995 is declarative of existing
24 law and is not a new enactment.
25 (D) The amount of any net operating loss
26 deduction taken in arriving at taxable income, other
27 than a net operating loss carried forward from a
28 taxable year ending prior to December 31, 1986; and
29 (E) For taxable years in which a net operating
30 loss carryback or carryforward from a taxable year
31 ending prior to December 31, 1986 is an element of
32 taxable income under paragraph (1) of subsection (e)
33 or subparagraph (E) of paragraph (2) of subsection
34 (e), the amount by which addition modifications
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1 other than those provided by this subparagraph (E)
2 exceeded subtraction modifications in such earlier
3 taxable year, with the following limitations applied
4 in the order that they are listed:
5 (i) the addition modification relating to
6 the net operating loss carried back or forward
7 to the taxable year from any taxable year
8 ending prior to December 31, 1986 shall be
9 reduced by the amount of addition modification
10 under this subparagraph (E) which related to
11 that net operating loss and which was taken
12 into account in calculating the base income of
13 an earlier taxable year, and
14 (ii) the addition modification relating
15 to the net operating loss carried back or
16 forward to the taxable year from any taxable
17 year ending prior to December 31, 1986 shall
18 not exceed the amount of such carryback or
19 carryforward;
20 For taxable years in which there is a net
21 operating loss carryback or carryforward from more
22 than one other taxable year ending prior to December
23 31, 1986, the addition modification provided in this
24 subparagraph (E) shall be the sum of the amounts
25 computed independently under the preceding
26 provisions of this subparagraph (E) for each such
27 taxable year,
28 and by deducting from the total so obtained the sum of
29 the following amounts:
30 (F) An amount equal to the amount of any tax
31 imposed by this Act which was refunded to the
32 taxpayer and included in such total for the taxable
33 year;
34 (G) An amount equal to any amount included in
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1 such total under Section 78 of the Internal Revenue
2 Code;
3 (H) In the case of a regulated investment
4 company, an amount equal to the amount of exempt
5 interest dividends as defined in subsection (b) (5)
6 of Section 852 of the Internal Revenue Code, paid to
7 shareholders for the taxable year;
8 (I) With the exception of any amounts
9 subtracted under subparagraph (J), an amount equal
10 to the sum of all amounts disallowed as deductions
11 by Sections 171(a) (2), and 265(a)(2) and amounts
12 disallowed as interest expense by Section 291(a)(3)
13 of the Internal Revenue Code, as now or hereafter
14 amended, and all amounts of expenses allocable to
15 interest and disallowed as deductions by Section
16 265(a)(1) of the Internal Revenue Code, as now or
17 hereafter amended;
18 (J) An amount equal to all amounts included in
19 such total which are exempt from taxation by this
20 State either by reason of its statutes or
21 Constitution or by reason of the Constitution,
22 treaties or statutes of the United States; provided
23 that, in the case of any statute of this State that
24 exempts income derived from bonds or other
25 obligations from the tax imposed under this Act, the
26 amount exempted shall be the interest net of bond
27 premium amortization;
28 (K) An amount equal to those dividends
29 included in such total which were paid by a
30 corporation which conducts business operations in an
31 Enterprise Zone or zones created under the Illinois
32 Enterprise Zone Act and conducts substantially all
33 of its operations in an Enterprise Zone or zones;
34 (L) An amount equal to those dividends
SB856 Enrolled -18- LRB9000732KDcbA
1 included in such total that were paid by a
2 corporation that conducts business operations in a
3 federally designated Foreign Trade Zone or Sub-Zone
4 and that is designated a High Impact Business
5 located in Illinois; provided that dividends
6 eligible for the deduction provided in subparagraph
7 (K) of paragraph 2 of this subsection shall not be
8 eligible for the deduction provided under this
9 subparagraph (L);
10 (M) For any taxpayer that is a financial
11 organization within the meaning of Section 304(c) of
12 this Act, an amount included in such total as
13 interest income from a loan or loans made by such
14 taxpayer to a borrower, to the extent that such a
15 loan is secured by property which is eligible for
16 the Enterprise Zone Investment Credit. To determine
17 the portion of a loan or loans that is secured by
18 property eligible for a Section 201(h) investment
19 credit to the borrower, the entire principal amount
20 of the loan or loans between the taxpayer and the
21 borrower should be divided into the basis of the
22 Section 201(h) investment credit property which
23 secures the loan or loans, using for this purpose
24 the original basis of such property on the date that
25 it was placed in service in the Enterprise Zone.
26 The subtraction modification available to taxpayer
27 in any year under this subsection shall be that
28 portion of the total interest paid by the borrower
29 with respect to such loan attributable to the
30 eligible property as calculated under the previous
31 sentence;
32 (M-1) For any taxpayer that is a financial
33 organization within the meaning of Section 304(c) of
34 this Act, an amount included in such total as
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1 interest income from a loan or loans made by such
2 taxpayer to a borrower, to the extent that such a
3 loan is secured by property which is eligible for
4 the High Impact Business Investment Credit. To
5 determine the portion of a loan or loans that is
6 secured by property eligible for a Section 201(i)
7 investment credit to the borrower, the entire
8 principal amount of the loan or loans between the
9 taxpayer and the borrower should be divided into the
10 basis of the Section 201(i) investment credit
11 property which secures the loan or loans, using for
12 this purpose the original basis of such property on
13 the date that it was placed in service in a
14 federally designated Foreign Trade Zone or Sub-Zone
15 located in Illinois. No taxpayer that is eligible
16 for the deduction provided in subparagraph (M) of
17 paragraph (2) of this subsection shall be eligible
18 for the deduction provided under this subparagraph
19 (M-1). The subtraction modification available to
20 taxpayers in any year under this subsection shall be
21 that portion of the total interest paid by the
22 borrower with respect to such loan attributable to
23 the eligible property as calculated under the
24 previous sentence;
25 (N) Two times any contribution made during the
26 taxable year to a designated zone organization to
27 the extent that the contribution (i) qualifies as a
28 charitable contribution under subsection (c) of
29 Section 170 of the Internal Revenue Code and (ii)
30 must, by its terms, be used for a project approved
31 by the Department of Commerce and Community Affairs
32 under Section 11 of the Illinois Enterprise Zone
33 Act;
34 (O) An amount equal to: (i) 85% for taxable
SB856 Enrolled -20- LRB9000732KDcbA
1 years ending on or before December 31, 1992, or, a
2 percentage equal to the percentage allowable under
3 Section 243(a)(1) of the Internal Revenue Code of
4 1986 for taxable years ending after December 31,
5 1992, of the amount by which dividends included in
6 taxable income and received from a corporation that
7 is not created or organized under the laws of the
8 United States or any state or political subdivision
9 thereof, including, for taxable years ending on or
10 after December 31, 1988, dividends received or
11 deemed received or paid or deemed paid under
12 Sections 951 through 964 of the Internal Revenue
13 Code, exceed the amount of the modification provided
14 under subparagraph (G) of paragraph (2) of this
15 subsection (b) which is related to such dividends;
16 plus (ii) 100% of the amount by which dividends,
17 included in taxable income and received, including,
18 for taxable years ending on or after December 31,
19 1988, dividends received or deemed received or paid
20 or deemed paid under Sections 951 through 964 of the
21 Internal Revenue Code, from any such corporation
22 specified in clause (i) that would but for the
23 provisions of Section 1504 (b) (3) of the Internal
24 Revenue Code be treated as a member of the
25 affiliated group which includes the dividend
26 recipient, exceed the amount of the modification
27 provided under subparagraph (G) of paragraph (2) of
28 this subsection (b) which is related to such
29 dividends;
30 (P) An amount equal to any contribution made
31 to a job training project established pursuant to
32 the Tax Increment Allocation Redevelopment Act; and
33 (Q) An amount equal to the amount of the
34 deduction used to compute the federal income tax
SB856 Enrolled -21- LRB9000732KDcbA
1 credit for restoration of substantial amounts held
2 under claim of right for the taxable year pursuant
3 to Section 1341 of the Internal Revenue Code of
4 1986.
5 (3) Special rule. For purposes of paragraph (2)
6 (A), "gross income" in the case of a life insurance
7 company, for tax years ending on and after December 31,
8 1994, shall mean the gross investment income for the
9 taxable year.
10 (c) Trusts and estates.
11 (1) In general. In the case of a trust or estate,
12 base income means an amount equal to the taxpayer's
13 taxable income for the taxable year as modified by
14 paragraph (2).
15 (2) Modifications. Subject to the provisions of
16 paragraph (3), the taxable income referred to in
17 paragraph (1) shall be modified by adding thereto the sum
18 of the following amounts:
19 (A) An amount equal to all amounts paid or
20 accrued to the taxpayer as interest or dividends
21 during the taxable year to the extent excluded from
22 gross income in the computation of taxable income;
23 (B) In the case of (i) an estate, $600; (ii) a
24 trust which, under its governing instrument, is
25 required to distribute all of its income currently,
26 $300; and (iii) any other trust, $100, but in each
27 such case, only to the extent such amount was
28 deducted in the computation of taxable income;
29 (C) An amount equal to the amount of tax
30 imposed by this Act to the extent deducted from
31 gross income in the computation of taxable income
32 for the taxable year;
33 (D) The amount of any net operating loss
34 deduction taken in arriving at taxable income, other
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1 than a net operating loss carried forward from a
2 taxable year ending prior to December 31, 1986;
3 (E) For taxable years in which a net operating
4 loss carryback or carryforward from a taxable year
5 ending prior to December 31, 1986 is an element of
6 taxable income under paragraph (1) of subsection (e)
7 or subparagraph (E) of paragraph (2) of subsection
8 (e), the amount by which addition modifications
9 other than those provided by this subparagraph (E)
10 exceeded subtraction modifications in such taxable
11 year, with the following limitations applied in the
12 order that they are listed:
13 (i) the addition modification relating to
14 the net operating loss carried back or forward
15 to the taxable year from any taxable year
16 ending prior to December 31, 1986 shall be
17 reduced by the amount of addition modification
18 under this subparagraph (E) which related to
19 that net operating loss and which was taken
20 into account in calculating the base income of
21 an earlier taxable year, and
22 (ii) the addition modification relating
23 to the net operating loss carried back or
24 forward to the taxable year from any taxable
25 year ending prior to December 31, 1986 shall
26 not exceed the amount of such carryback or
27 carryforward;
28 For taxable years in which there is a net
29 operating loss carryback or carryforward from more
30 than one other taxable year ending prior to December
31 31, 1986, the addition modification provided in this
32 subparagraph (E) shall be the sum of the amounts
33 computed independently under the preceding
34 provisions of this subparagraph (E) for each such
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1 taxable year;
2 (F) For taxable years ending on or after
3 January 1, 1989, an amount equal to the tax deducted
4 pursuant to Section 164 of the Internal Revenue Code
5 if the trust or estate is claiming the same tax for
6 purposes of the Illinois foreign tax credit under
7 Section 601 of this Act; and
8 (G) An amount equal to the amount of the
9 capital gain deduction allowable under the Internal
10 Revenue Code, to the extent deducted from gross
11 income in the computation of taxable income;
12 and by deducting from the total so obtained the sum of
13 the following amounts:
14 (H) An amount equal to all amounts included in
15 such total pursuant to the provisions of Sections
16 402(a), 402(c), 403(a), 403(b), 406(a), 407(a) and
17 408 of the Internal Revenue Code or included in such
18 total as distributions under the provisions of any
19 retirement or disability plan for employees of any
20 governmental agency or unit, or retirement payments
21 to retired partners, which payments are excluded in
22 computing net earnings from self employment by
23 Section 1402 of the Internal Revenue Code and
24 regulations adopted pursuant thereto;
25 (I) The valuation limitation amount;
26 (J) An amount equal to the amount of any tax
27 imposed by this Act which was refunded to the
28 taxpayer and included in such total for the taxable
29 year;
30 (K) An amount equal to all amounts included in
31 taxable income as modified by subparagraphs (A),
32 (B), (C), (D), (E), (F) and (G) which are exempt
33 from taxation by this State either by reason of its
34 statutes or Constitution or by reason of the
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1 Constitution, treaties or statutes of the United
2 States; provided that, in the case of any statute of
3 this State that exempts income derived from bonds or
4 other obligations from the tax imposed under this
5 Act, the amount exempted shall be the interest net
6 of bond premium amortization;
7 (L) With the exception of any amounts
8 subtracted under subparagraph (K), an amount equal
9 to the sum of all amounts disallowed as deductions
10 by Sections 171(a) (2) and 265(a)(2) of the Internal
11 Revenue Code, as now or hereafter amended, and all
12 amounts of expenses allocable to interest and
13 disallowed as deductions by Section 265(1) of the
14 Internal Revenue Code of 1954, as now or hereafter
15 amended;
16 (M) An amount equal to those dividends
17 included in such total which were paid by a
18 corporation which conducts business operations in an
19 Enterprise Zone or zones created under the Illinois
20 Enterprise Zone Act and conducts substantially all
21 of its operations in an Enterprise Zone or Zones;
22 (N) An amount equal to any contribution made
23 to a job training project established pursuant to
24 the Tax Increment Allocation Redevelopment Act;
25 (O) An amount equal to those dividends
26 included in such total that were paid by a
27 corporation that conducts business operations in a
28 federally designated Foreign Trade Zone or Sub-Zone
29 and that is designated a High Impact Business
30 located in Illinois; provided that dividends
31 eligible for the deduction provided in subparagraph
32 (M) of paragraph (2) of this subsection shall not be
33 eligible for the deduction provided under this
34 subparagraph (O); and
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1 (P) An amount equal to the amount of the
2 deduction used to compute the federal income tax
3 credit for restoration of substantial amounts held
4 under claim of right for the taxable year pursuant
5 to Section 1341 of the Internal Revenue Code of
6 1986.
7 (3) Limitation. The amount of any modification
8 otherwise required under this subsection shall, under
9 regulations prescribed by the Department, be adjusted by
10 any amounts included therein which were properly paid,
11 credited, or required to be distributed, or permanently
12 set aside for charitable purposes pursuant to Internal
13 Revenue Code Section 642(c) during the taxable year.
14 (d) Partnerships.
15 (1) In general. In the case of a partnership, base
16 income means an amount equal to the taxpayer's taxable
17 income for the taxable year as modified by paragraph (2).
18 (2) Modifications. The taxable income referred to
19 in paragraph (1) shall be modified by adding thereto the
20 sum of the following amounts:
21 (A) An amount equal to all amounts paid or
22 accrued to the taxpayer as interest or dividends
23 during the taxable year to the extent excluded from
24 gross income in the computation of taxable income;
25 (B) An amount equal to the amount of tax
26 imposed by this Act to the extent deducted from
27 gross income for the taxable year; and
28 (C) The amount of deductions allowed to the
29 partnership pursuant to Section 707 (c) of the
30 Internal Revenue Code in calculating its taxable
31 income;
32 (D) An amount equal to the amount of the
33 capital gain deduction allowable under the Internal
34 Revenue Code, to the extent deducted from gross
SB856 Enrolled -26- LRB9000732KDcbA
1 income in the computation of taxable income;
2 and by deducting from the total so obtained the following
3 amounts:
4 (E) The valuation limitation amount;
5 (F) An amount equal to the amount of any tax
6 imposed by this Act which was refunded to the
7 taxpayer and included in such total for the taxable
8 year;
9 (G) An amount equal to all amounts included in
10 taxable income as modified by subparagraphs (A),
11 (B), (C) and (D) which are exempt from taxation by
12 this State either by reason of its statutes or
13 Constitution or by reason of the Constitution,
14 treaties or statutes of the United States; provided
15 that, in the case of any statute of this State that
16 exempts income derived from bonds or other
17 obligations from the tax imposed under this Act, the
18 amount exempted shall be the interest net of bond
19 premium amortization;
20 (H) Any income of the partnership which
21 constitutes personal service income as defined in
22 Section 1348 (b) (1) of the Internal Revenue Code
23 (as in effect December 31, 1981) or a reasonable
24 allowance for compensation paid or accrued for
25 services rendered by partners to the partnership,
26 whichever is greater;
27 (I) An amount equal to all amounts of income
28 distributable to an entity subject to the Personal
29 Property Tax Replacement Income Tax imposed by
30 subsections (c) and (d) of Section 201 of this Act
31 including amounts distributable to organizations
32 exempt from federal income tax by reason of Section
33 501(a) of the Internal Revenue Code;
34 (J) With the exception of any amounts
SB856 Enrolled -27- LRB9000732KDcbA
1 subtracted under subparagraph (G), an amount equal
2 to the sum of all amounts disallowed as deductions
3 by Sections 171(a) (2), and 265(2) of the Internal
4 Revenue Code of 1954, as now or hereafter amended,
5 and all amounts of expenses allocable to interest
6 and disallowed as deductions by Section 265(1) of
7 the Internal Revenue Code, as now or hereafter
8 amended;
9 (K) An amount equal to those dividends
10 included in such total which were paid by a
11 corporation which conducts business operations in an
12 Enterprise Zone or zones created under the Illinois
13 Enterprise Zone Act, enacted by the 82nd General
14 Assembly, and which does not conduct such operations
15 other than in an Enterprise Zone or Zones;
16 (L) An amount equal to any contribution made
17 to a job training project established pursuant to
18 the Real Property Tax Increment Allocation
19 Redevelopment Act;
20 (M) An amount equal to those dividends
21 included in such total that were paid by a
22 corporation that conducts business operations in a
23 federally designated Foreign Trade Zone or Sub-Zone
24 and that is designated a High Impact Business
25 located in Illinois; provided that dividends
26 eligible for the deduction provided in subparagraph
27 (K) of paragraph (2) of this subsection shall not be
28 eligible for the deduction provided under this
29 subparagraph (M); and
30 (N) An amount equal to the amount of the
31 deduction used to compute the federal income tax
32 credit for restoration of substantial amounts held
33 under claim of right for the taxable year pursuant
34 to Section 1341 of the Internal Revenue Code of
SB856 Enrolled -28- LRB9000732KDcbA
1 1986.
2 (e) Gross income; adjusted gross income; taxable income.
3 (1) In general. Subject to the provisions of
4 paragraph (2) and subsection (b) (3), for purposes of
5 this Section and Section 803(e), a taxpayer's gross
6 income, adjusted gross income, or taxable income for the
7 taxable year shall mean the amount of gross income,
8 adjusted gross income or taxable income properly
9 reportable for federal income tax purposes for the
10 taxable year under the provisions of the Internal Revenue
11 Code. Taxable income may be less than zero. However, for
12 taxable years ending on or after December 31, 1986, net
13 operating loss carryforwards from taxable years ending
14 prior to December 31, 1986, may not exceed the sum of
15 federal taxable income for the taxable year before net
16 operating loss deduction, plus the excess of addition
17 modifications over subtraction modifications for the
18 taxable year. For taxable years ending prior to December
19 31, 1986, taxable income may never be an amount in excess
20 of the net operating loss for the taxable year as defined
21 in subsections (c) and (d) of Section 172 of the Internal
22 Revenue Code, provided that when taxable income of a
23 corporation (other than a Subchapter S corporation),
24 trust, or estate is less than zero and addition
25 modifications, other than those provided by subparagraph
26 (E) of paragraph (2) of subsection (b) for corporations
27 or subparagraph (E) of paragraph (2) of subsection (c)
28 for trusts and estates, exceed subtraction modifications,
29 an addition modification must be made under those
30 subparagraphs for any other taxable year to which the
31 taxable income less than zero (net operating loss) is
32 applied under Section 172 of the Internal Revenue Code or
33 under subparagraph (E) of paragraph (2) of this
34 subsection (e) applied in conjunction with Section 172 of
SB856 Enrolled -29- LRB9000732KDcbA
1 the Internal Revenue Code.
2 (2) Special rule. For purposes of paragraph (1) of
3 this subsection, the taxable income properly reportable
4 for federal income tax purposes shall mean:
5 (A) Certain life insurance companies. In the
6 case of a life insurance company subject to the tax
7 imposed by Section 801 of the Internal Revenue Code,
8 life insurance company taxable income, plus the
9 amount of distribution from pre-1984 policyholder
10 surplus accounts as calculated under Section 815a of
11 the Internal Revenue Code;
12 (B) Certain other insurance companies. In the
13 case of mutual insurance companies subject to the
14 tax imposed by Section 831 of the Internal Revenue
15 Code, insurance company taxable income;
16 (C) Regulated investment companies. In the
17 case of a regulated investment company subject to
18 the tax imposed by Section 852 of the Internal
19 Revenue Code, investment company taxable income;
20 (D) Real estate investment trusts. In the
21 case of a real estate investment trust subject to
22 the tax imposed by Section 857 of the Internal
23 Revenue Code, real estate investment trust taxable
24 income;
25 (E) Consolidated corporations. In the case of
26 a corporation which is a member of an affiliated
27 group of corporations filing a consolidated income
28 tax return for the taxable year for federal income
29 tax purposes, taxable income determined as if such
30 corporation had filed a separate return for federal
31 income tax purposes for the taxable year and each
32 preceding taxable year for which it was a member of
33 an affiliated group. For purposes of this
34 subparagraph, the taxpayer's separate taxable income
SB856 Enrolled -30- LRB9000732KDcbA
1 shall be determined as if the election provided by
2 Section 243(b) (2) of the Internal Revenue Code had
3 been in effect for all such years;
4 (F) Cooperatives. In the case of a
5 cooperative corporation or association, the taxable
6 income of such organization determined in accordance
7 with the provisions of Section 1381 through 1388 of
8 the Internal Revenue Code;
9 (G) Subchapter S corporations. In the case
10 of: (i) a Subchapter S corporation for which there
11 is in effect an election for the taxable year under
12 Section 1362 of the Internal Revenue Code, the
13 taxable income of such corporation determined in
14 accordance with Section 1363(b) of the Internal
15 Revenue Code, except that taxable income shall take
16 into account those items which are required by
17 Section 1363(b)(1) of the Internal Revenue Code to
18 be separately stated; and (ii) a Subchapter S
19 corporation for which there is in effect a federal
20 election to opt out of the provisions of the
21 Subchapter S Revision Act of 1982 and have applied
22 instead the prior federal Subchapter S rules as in
23 effect on July 1, 1982, the taxable income of such
24 corporation determined in accordance with the
25 federal Subchapter S rules as in effect on July 1,
26 1982; and
27 (H) Partnerships. In the case of a
28 partnership, taxable income determined in accordance
29 with Section 703 of the Internal Revenue Code,
30 except that taxable income shall take into account
31 those items which are required by Section 703(a)(1)
32 to be separately stated but which would be taken
33 into account by an individual in calculating his
34 taxable income.
SB856 Enrolled -31- LRB9000732KDcbA
1 (f) Valuation limitation amount.
2 (1) In general. The valuation limitation amount
3 referred to in subsections (a) (2) (G), (c) (2) (I) and
4 (d)(2) (E) is an amount equal to:
5 (A) The sum of the pre-August 1, 1969
6 appreciation amounts (to the extent consisting of
7 gain reportable under the provisions of Section 1245
8 or 1250 of the Internal Revenue Code) for all
9 property in respect of which such gain was reported
10 for the taxable year; plus
11 (B) The lesser of (i) the sum of the
12 pre-August 1, 1969 appreciation amounts (to the
13 extent consisting of capital gain) for all property
14 in respect of which such gain was reported for
15 federal income tax purposes for the taxable year, or
16 (ii) the net capital gain for the taxable year,
17 reduced in either case by any amount of such gain
18 included in the amount determined under subsection
19 (a) (2) (F) or (c) (2) (H).
20 (2) Pre-August 1, 1969 appreciation amount.
21 (A) If the fair market value of property
22 referred to in paragraph (1) was readily
23 ascertainable on August 1, 1969, the pre-August 1,
24 1969 appreciation amount for such property is the
25 lesser of (i) the excess of such fair market value
26 over the taxpayer's basis (for determining gain) for
27 such property on that date (determined under the
28 Internal Revenue Code as in effect on that date), or
29 (ii) the total gain realized and reportable for
30 federal income tax purposes in respect of the sale,
31 exchange or other disposition of such property.
32 (B) If the fair market value of property
33 referred to in paragraph (1) was not readily
34 ascertainable on August 1, 1969, the pre-August 1,
SB856 Enrolled -32- LRB9000732KDcbA
1 1969 appreciation amount for such property is that
2 amount which bears the same ratio to the total gain
3 reported in respect of the property for federal
4 income tax purposes for the taxable year, as the
5 number of full calendar months in that part of the
6 taxpayer's holding period for the property ending
7 July 31, 1969 bears to the number of full calendar
8 months in the taxpayer's entire holding period for
9 the property.
10 (C) The Department shall prescribe such
11 regulations as may be necessary to carry out the
12 purposes of this paragraph.
13 (g) Double deductions. Unless specifically provided
14 otherwise, nothing in this Section shall permit the same item
15 to be deducted more than once.
16 (h) Legislative intention. Except as expressly provided
17 by this Section there shall be no modifications or
18 limitations on the amounts of income, gain, loss or deduction
19 taken into account in determining gross income, adjusted
20 gross income or taxable income for federal income tax
21 purposes for the taxable year, or in the amount of such items
22 entering into the computation of base income and net income
23 under this Act for such taxable year, whether in respect of
24 property values as of August 1, 1969 or otherwise.
25 (Source: P.A. 88-195; 88-648, eff. 9-16-94; 88-669, eff.
26 11-29-94; 88-670, eff. 12-2-94; 89-89, eff. 6-30-95; 89-235,
27 eff. 8-4-95; 89-418, eff. 11-15-95; 89-460, eff. 5-24-96;
28 89-626, eff. 8-9-96.)
29 (35 ILCS 5/301) (from Ch. 120, par. 3-301)
30 Sec. 301. General Rule.
31 (a) Residents. All items of income or deduction which
32 were taken into account in the computation of base income for
33 the taxable year by a resident shall be allocated to this
SB856 Enrolled -33- LRB9000732KDcbA
1 State.
2 (b) Part-year residents. All items of income or
3 deduction which were taken into account in the computation of
4 base income for the taxable year by a part-year resident
5 shall, for that part of the year the part-year resident was a
6 resident of this State, be allocated to this State and, for
7 the remaining part of the year, be allocated to this State
8 only to the extent provided by Section 302, 303 or 304
9 (relating to compensation, nonbusiness income and business
10 income, respectively).
11 (c) Other persons.
12 (1) In general. Any item of income or deduction
13 which was taken into account in the computation of base
14 income for the taxable year by any person other than a
15 resident and which is referred to in Section 302, 303 or
16 304 (relating to compensation, nonbusiness income and
17 business income, respectively) shall be allocated to this
18 State only to the extent provided by such section.
19 (2) Unspecified items. Any item of income or
20 deduction which was taken into account in the computation
21 of base income for the taxable year by any person other
22 than a resident and which is not otherwise specifically
23 allocated or apportioned pursuant to Section 302, 303 or
24 304 (including, without limitation, interest, dividends,
25 items of income taken into account under the provisions
26 of Sections 401 through 425 of the Internal Revenue Code,
27 and benefit payments received by a beneficiary of a
28 supplemental unemployment benefit trust which is referred
29 to in Section 501(c)(17) of the Internal Revenue Code):
30 (A) in the case of an individual, trust or
31 estate, shall not be allocated to this State; and
32 (B) in the case of a corporation, trust, or a
33 partnership, shall be allocated to this State if the
34 taxpayer had its commercial domicile in this State
SB856 Enrolled -34- LRB9000732KDcbA
1 at the time such item was paid, incurred or accrued.
2 (Source: P.A. 82-609.)
3 (35 ILCS 5/302) (from Ch. 120, par. 3-302)
4 Sec. 302. Compensation paid to nonresidents.
5 (a) In general. All items of compensation paid in this
6 State (as determined under Section 304(a)(2)(B)) to an
7 individual who is a nonresident at the time of such payment
8 and all items of deduction directly allocable thereto, shall
9 be allocated to this State.
10 (b) Reciprocal exemption. The Director may enter into an
11 agreement with the taxing authorities of any state which
12 imposes a tax on or measured by income to provide that
13 compensation paid in such state to residents of this State
14 shall be exempt from such tax; in such case, any compensation
15 paid in this State to residents of such state shall not be
16 allocated to this State. All reciprocal agreements shall be
17 subject to the requirements of Section 39b53 of the Civil
18 Administrative Code of Illinois.
19 (c) Cross references.
20 (1) For allocation of amounts received by
21 nonresidents from certain employee trusts, see Section
22 301(b)(2).
23 (2) For allocation of compensation by residents,
24 see Section 301(a).
25 (Source: P.A. 77-1379.)
26 (35 ILCS 5/506) (from Ch. 120, par. 5-506)
27 Sec. 506. Federal Returns. (a) In general. Any person
28 required to make a return for a taxable year under this Act
29 may, at any time that a deficiency could be assessed or a
30 refund claimed under this Act in respect of any item reported
31 or properly reportable on such return or any amendment
32 thereof, be required to furnish to the Department a true and
SB856 Enrolled -35- LRB9000732KDcbA
1 correct copy of any return which may pertain to such item and
2 which was filed by such person under the provisions of the
3 Internal Revenue Code.
4 (b) Changes affecting federal income tax. In the event
5 the taxable income, any item of income or deduction, or the
6 income tax liability, or any tax credit reported in a federal
7 income tax return of any person for any year is altered by
8 amendment of such return or as a result of any other
9 recomputation or redetermination of federal taxable income or
10 loss, and such alteration reflects a change or settlement
11 with respect to any item or items, affecting the computation
12 of such person's net income, net loss, or of any credit
13 provided by Article 2 of this Act base income for any year
14 under this Act, or in the number of personal exemptions
15 allowable to such person under Section 151 of the Internal
16 Revenue Code, such person shall notify the Department of such
17 alteration. Such notification shall be in the form of an
18 amended return or such other form as the Department may by
19 regulations prescribe, shall contain the person's name and
20 address and such other information as the Department may by
21 regulations prescribe, shall be signed by such person or his
22 duly authorized representative, and shall be filed not later
23 than 120 days after such alteration has been agreed to or
24 finally determined for federal income tax purposes or any
25 federal income tax deficiency or refund, tentative carryback
26 adjustment, abatement or credit resulting therefrom has been
27 assessed or paid, whichever shall first occur.
28 (Source: P.A. 86-905.)
29 (35 ILCS 5/701) (from Ch. 120, par. 7-701)
30 Sec. 701. Requirement and Amount of Withholding.
31 (a) In General.
32 Every employer maintaining an office or transacting
33 business within this State and required under the provisions
SB856 Enrolled -36- LRB9000732KDcbA
1 of the Internal Revenue Code to withhold a tax on:
2 (1) compensation paid in this State (as determined
3 under Section 304 (a) (2) (B) to an individual; or
4 (2) payments described in subsection (b) shall
5 deduct and withhold from such compensation for each
6 payroll period (as defined in Section 3401 of the
7 Internal Revenue Code) an amount equal to the amount by
8 which such individual's compensation exceeds the
9 proportionate part of this withholding exemption
10 (computed as provided in Section 702) attributable to the
11 payroll period for which such compensation is payable
12 multiplied by a percentage equal to the percentage tax
13 rate for individuals provided in subsection (b) of
14 Section 201.
15 (b) Payment to Residents.
16 Any payment (including compensation) to a resident by a
17 payor maintaining an office or transacting business within
18 this State and on which withholding of tax is required under
19 the provisions of the Internal Revenue Code shall be deemed
20 to be compensation paid in this State by an employer to an
21 employee for the purposes of Article 7 and Section 601 (b)
22 (1) to the extent such payment is included in the recipient's
23 base income and not subjected to withholding by another
24 state.
25 (c) Special Definitions.
26 Withholding shall be considered required under the
27 provisions of the Internal Revenue Code to the extent the
28 Internal Revenue Code either requires withholding or allows
29 for voluntary withholding the payor and recipient have
30 entered into such a voluntary withholding agreement. For the
31 purposes of Article 7 and Section 1002 (c) the term
32 "employer" includes any payor who is required to withhold tax
33 pursuant to this Section.
34 (d) Reciprocal Exemption.
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1 The Director may enter into an agreement with the taxing
2 authorities of any state which imposes a tax on or measured
3 by income to provide that compensation paid in such state to
4 residents of this State shall be exempt from withholding of
5 such tax; in such case, any compensation paid in this State
6 to residents of such state shall be exempt from withholding.
7 All reciprocal agreements shall be subject to the
8 requirements of Section 39b53 of the Civil Administrative
9 Code of Illinois.
10 (e) Notwithstanding subsection (a) (2) of this Section,
11 no withholding is required on payments for which withholding
12 is required under Section 3405 or 3406 of the Internal
13 Revenue Code of 1954.
14 (Source: P.A. 85-731; 86-1475.)
15 (35 ILCS 5/806 new)
16 Sec. 806. Exemption from penalty. An individual
17 taxpayer shall not be subject to a penalty for failing to pay
18 estimated tax as required by Section 803 if the taxpayer is
19 65 years of age or older and is a permanent resident of a
20 nursing home. For purposes of this Section, "nursing home"
21 means a skilled nursing or intermediate long term care
22 facility that is subject to licensure by the Illinois
23 Department of Public Health under the Nursing Home Care Act.
24 (35 ILCS 5/905) (from Ch. 120, par. 9-905)
25 Sec. 905. Limitations on Notices of Deficiency.
26 (a) In general. Except as otherwise provided in this
27 Act:
28 (1) A notice of deficiency shall be issued not
29 later than 3 years after the date the return was filed,
30 and
31 (2) No deficiency shall be assessed or collected
32 with respect to the year for which the return was filed
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1 unless such notice is issued within such period.
2 (b) Omission of more than 25% of income. If the taxpayer
3 omits from base income an amount properly includible therein
4 which is in excess of 25% of the amount of base income stated
5 in the return, a notice of deficiency may be issued not later
6 than 6 years after the return was filed. For purposes of this
7 paragraph, there shall not be taken into account any amount
8 which is omitted in the return if such amount is disclosed in
9 the return, or in a statement attached to the return, in a
10 manner adequate to apprise the Department of the nature and
11 the amount of such item.
12 (c) No return or fraudulent return. If no return is
13 filed or a false and fraudulent return is filed with intent
14 to evade the tax imposed by this Act, a notice of deficiency
15 may be issued at any time.
16 (d) Failure to report federal change. If a taxpayer
17 fails to notify the Department in any case where notification
18 is required by Section 304(c) or 506(b), or fails to report a
19 change or correction which is treated in the same manner as
20 if it were a deficiency for federal income tax purposes, a
21 notice of deficiency may be issued at any time.
22 (e) Report of federal change. In any case where
23 notification of an alteration is given as required by Section
24 506(b), a notice of deficiency may be issued at any time
25 within 2 years after the date such notification is given,
26 provided, however, that the amount of any proposed assessment
27 set forth in such notice shall be limited to the amount of
28 any deficiency resulting under this Act from recomputation of
29 the taxpayer's net income, net loss, or Article 2 credits
30 base income for the taxable year after giving effect to the
31 item or items reflected in the reported alteration.
32 (f) Extension by agreement. Where, before the expiration
33 of the time prescribed in this section for the issuance of a
34 notice of deficiency, both the Department and the taxpayer
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1 shall have consented in writing to its issuance after such
2 time, such notice may be issued at any time prior to the
3 expiration of the period agreed upon. The period so agreed
4 upon may be extended by subsequent agreements in writing made
5 before the expiration of the period previously agreed upon.
6 (g) Erroneous refunds. In any case in which there has
7 been an erroneous refund of tax payable under this Act, a
8 notice of deficiency may be issued at any time within 2 years
9 from the making of such refund, or within 5 years from the
10 making of such refund if it appears that any part of the
11 refund was induced by fraud or the misrepresentation of a
12 material fact, provided, however, that the amount of any
13 proposed assessment set forth in such notice shall be limited
14 to the amount of such erroneous refund.
15 Beginning July 1, 1993, in any case in which there has
16 been a refund of tax payable under this Act attributable to a
17 net loss carryback as provided for in Section 207, and that
18 refund is subsequently determined to be an erroneous refund
19 due to a reduction in the amount of the net loss which was
20 originally carried back, a notice of deficiency for the
21 erroneous refund amount may be issued at any time during the
22 same time period in which a notice of deficiency can be
23 issued on the loss year creating the carryback amount and
24 subsequent erroneous refund. The amount of any proposed
25 assessment set forth in the notice shall be limited to the
26 amount of such erroneous refund.
27 (h) Time return deemed filed. For purposes of this
28 Section a tax return filed before the last day prescribed by
29 law (including any extension thereof) shall be deemed to have
30 been filed on such last day.
31 (i) Request for prompt determination of liability. For
32 purposes of Subsection (a)(1), in the case of a tax return
33 required under this Act in respect of a decedent, or by his
34 estate during the period of administration, or by a
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1 corporation, the period referred to in such Subsection shall
2 be 18 months after a written request for prompt determination
3 of liability is filed with the Department (at such time and
4 in such form and manner as the Department shall by
5 regulations prescribe) by the executor, administrator, or
6 other fiduciary representing the estate of such decedent, or
7 by such corporation, but not more than 3 years after the date
8 the return was filed. This Subsection shall not apply in the
9 case of a corporation unless:
10 (1) (A) Such written request notifies the
11 Department that the corporation contemplates dissolution
12 at or before the expiration of such 18-month period, (B)
13 the dissolution is begun in good faith before the
14 expiration of such 18-month period, and (C) the
15 dissolution is completed;
16 (2) (A) Such written request notifies the
17 Department that a dissolution has in good faith been
18 begun, and (B) the dissolution is completed; or
19 (3) A dissolution has been completed at the time
20 such written request is made.
21 (j) Withholding tax. In the case of returns required
22 under Article 7 of this Act (with respect to any amounts
23 withheld as tax or any amounts required to have been withheld
24 as tax) a notice of deficiency shall be issued not later than
25 3 years after the 15th day of the 4th month following the
26 close of the calendar year in which such withholding was
27 required.
28 (k) Penalties for failure to make information reports.
29 A notice of deficiency for the penalties provided by
30 Subsection 1405.1(c) of this Act may not be issued more than
31 3 years after the due date of the reports with respect to
32 which the penalties are asserted.
33 (l) Penalty for failure to file withholding returns. A
34 notice of deficiency for penalties provided by Section 1004
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1 of this Act for taxpayer's failure to file withholding
2 returns may not be issued more than three years after the
3 15th day of the 4th month following the close of the calendar
4 year in which the withholding giving rise to taxpayer's
5 obligation to file those returns occurred.
6 (m) Transferee liability. A notice of deficiency may be
7 issued to a transferee relative to a liability asserted under
8 Section 1405 during time periods defined as follows:
9 1) Initial Transferee. In the case of the
10 liability of an initial transferee, up to 2 years after
11 the expiration of the period of limitation for assessment
12 against the transferor, except that if a court proceeding
13 for review of the assessment against the transferor has
14 begun, then up to 2 years after the return of the
15 certified copy of the judgment in the court proceeding.
16 2) Transferee of Transferee. In the case of the
17 liability of a transferee, up to 2 years after the
18 expiration of the period of limitation for assessment
19 against the preceding transferee, but not more than 3
20 years after the expiration of the period of limitation
21 for assessment against the initial transferor; except
22 that if, before the expiration of the period of
23 limitation for the assessment of the liability of the
24 transferee, a court proceeding for the collection of the
25 tax or liability in respect thereof has been begun
26 against the initial transferor or the last preceding
27 transferee, as the case may be, then the period of
28 limitation for assessment of the liability of the
29 transferee shall expire 2 years after the return of the
30 certified copy of the judgment in the court proceeding.
31 (Source: P.A. 88-195.)
32 (35 ILCS 5/911) (from Ch. 120, par. 9-911)
33 Sec. 911. Limitations on Claims for Refund. (a) In
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1 general. Except as otherwise provided in this Act:
2 (1) A claim for refund shall be filed not later than 3
3 years after the date the return was filed (in the case of
4 returns required under Article 7 of this Act respecting any
5 amounts withheld as tax, not later than 3 years after the
6 15th day of the 4th month following the close of the calendar
7 year in which such withholding was made), or one year after
8 the date the tax was paid, whichever is the later; and
9 (2) No credit or refund shall be allowed or made with
10 respect to the year for which the claim was filed unless such
11 claim is filed within such period.
12 (b) Federal changes. (1) In general. In any case where
13 notification of an alteration is required by Section 506 (b),
14 a claim for refund may be filed within 2 years after the date
15 on which such notification was due (regardless of whether
16 such notice was given), but the amount recoverable pursuant
17 to a claim filed under this Section shall be limited to the
18 amount of any overpayment resulting under this Act from
19 recomputation of the taxpayer's net income, net loss, or
20 Article 2 credits base income for the taxable year after
21 giving effect to the item or items reflected in the
22 alteration required to be reported.
23 (2) Tentative carryback adjustments paid before January
24 1, 1974. If, as the result of the payment before January 1,
25 1974 of a federal tentative carryback adjustment, a
26 notification of an alteration is required under Section 506
27 (b), a claim for refund may be filed at any time before
28 January 1, 1976, but the amount recoverable pursuant to a
29 claim filed under this Section shall be limited to the amount
30 of any overpayment resulting under this Act from
31 recomputation of the taxpayer's base income for the taxable
32 year after giving effect to the federal alteration resulting
33 from the tentative carryback adjustment irrespective of any
34 limitation imposed in paragraph (l) of this subsection.
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1 (c) Extension by agreement. Where, before the
2 expiration of the time prescribed in this section for the
3 filing of a claim for refund, both the Department and the
4 claimant shall have consented in writing to its filing after
5 such time, such claim may be filed at any time prior to the
6 expiration of the period agreed upon. The period so agreed
7 upon may be extended by subsequent agreements in writing made
8 before the expiration of the period previously agreed upon.
9 (d) Limit on amount of credit or refund.
10 (1) Limit where claim filed within 3-year period. If
11 the claim was filed by the claimant during the 3-year period
12 prescribed in subsection (a), the amount of the credit or
13 refund shall not exceed the portion of the tax paid within
14 the period, immediately preceding the filing of the claim,
15 equal to 3 years plus the period of any extension of time for
16 filing the return.
17 (2) Limit where claim not filed within 3-year period.
18 If the claim was not filed within such 3-year period, the
19 amount of the credit or refund shall not exceed the portion
20 of the tax paid during the one year immediately preceding the
21 filing of the claim.
22 (e) Time return deemed filed. For purposes of this
23 section a tax return filed before the last day prescribed by
24 law for the filing of such return (including any extensions
25 thereof) shall be deemed to have been filed on such last day.
26 (f) No claim for refund based on the taxpayer's taking a
27 credit for estimated tax payments as provided by Section 601
28 (b) (2) or for any amount paid by a taxpayer pursuant to
29 Section 602(a) or for any amount of credit for tax withheld
30 pursuant to Section 701 may be filed more than 3 years after
31 the due date, as provided by Section 505, of the return which
32 was required to be filed relative to the taxable year for
33 which the payments were made or for which the tax was
34 withheld. The changes in this subsection (f) made by this
SB856 Enrolled -44- LRB9000732KDcbA
1 amendatory Act of 1987 shall apply to all taxable years
2 ending on or after December 31, 1969.
3 (g) Special Period of Limitation with Respect to Net
4 Loss Carrybacks. If the claim for refund relates to an
5 overpayment attributable to a net loss carryback as provided
6 by Section 207, in lieu of the 3 year period of limitation
7 prescribed in subsection (a), the period shall be that period
8 which ends 3 years after the time prescribed by law for
9 filing the return (including extensions thereof) for the
10 taxable year of the net loss which results in such carryback,
11 or the period prescribed in subsection (c) in respect of such
12 taxable year, whichever expires later. In the case of such a
13 claim, the amount of the refund may exceed the portion of the
14 tax paid within the period provided in subsection (d) to the
15 extent of the amount of the overpayment attributable to such
16 carryback.
17 (Source: P.A. 86-905.)
18 (35 ILCS 5/917) (from Ch. 120, par. 9-917)
19 (Text of Section before amendment by P.A. 89-507)
20 Sec. 917. Confidentiality and information sharing.
21 (a) Confidentiality. Except as provided in this Section,
22 all information received by the Department from returns filed
23 under this Act, or from any investigation conducted under the
24 provisions of this Act, shall be confidential, except for
25 official purposes within the Department or pursuant to
26 official procedures for collection of any State tax or
27 pursuant to an investigation or audit by the Illinois State
28 Scholarship Commission of a delinquent student loan or
29 monetary award or enforcement of any civil or criminal
30 penalty or sanction imposed by this Act or by another statute
31 imposing a State tax, and any person who divulges any such
32 information in any manner, except for such purposes and
33 pursuant to order of the Director or in accordance with a
SB856 Enrolled -45- LRB9000732KDcbA
1 proper judicial order, shall be guilty of a Class A
2 misdemeanor. However, the provisions of this paragraph are
3 not applicable to information furnished to a licensed
4 attorney representing the taxpayer where an appeal or a
5 protest has been filed on behalf of the taxpayer.
6 (b) Public information. Nothing contained in this Act
7 shall prevent the Director from publishing or making
8 available to the public the names and addresses of persons
9 filing returns under this Act, or from publishing or making
10 available reasonable statistics concerning the operation of
11 the tax wherein the contents of returns are grouped into
12 aggregates in such a way that the information contained in
13 any individual return shall not be disclosed.
14 (c) Governmental agencies. The Director may make
15 available to the Secretary of the Treasury of the United
16 States or his delegate, or the proper officer or his delegate
17 of any other state imposing a tax upon or measured by income,
18 for exclusively official purposes, information received by
19 the Department in the administration of this Act, but such
20 permission shall be granted only if the United States or such
21 other state, as the case may be, grants the Department
22 substantially similar privileges. The Director may exchange
23 information with the Illinois Department of Public Aid for
24 the purpose of verifying sources and amounts of income and
25 for other purposes directly connected with the administration
26 of this Act and The Illinois Public Aid Code. The Director
27 may exchange information with the Director of the Department
28 of Employment Security for the purpose of verifying sources
29 and amounts of income and for other purposes directly
30 connected with the administration of this Act and Acts
31 administered by the Department of Employment Security. The
32 Director may make available to the Illinois Industrial
33 Commission information regarding employers for the purpose of
34 verifying the insurance coverage required under the Workers'
SB856 Enrolled -46- LRB9000732KDcbA
1 Compensation Act and Workers' Occupational Diseases Act.
2 The Director may make available to any State agency,
3 including the Illinois Supreme Court, which licenses persons
4 to engage in any occupation, information that a person
5 licensed by such agency has failed to file returns under this
6 Act or pay the tax, penalty and interest shown therein, or
7 has failed to pay any final assessment of tax, penalty or
8 interest due under this Act. The Director may also make
9 available to the Secretary of State information that a
10 corporation which has been issued a certificate of
11 incorporation by the Secretary of State has failed to file
12 returns under this Act or pay the tax, penalty and interest
13 shown therein, or has failed to pay any final assessment of
14 tax, penalty or interest due under this Act. An assessment is
15 final when all proceedings in court for review of such
16 assessment have terminated or the time for the taking thereof
17 has expired without such proceedings being instituted. For
18 taxable years ending on or after December 31, 1987, the
19 Director may make available to the Director or principal
20 officer of any Department of the State of Illinois,
21 information that a person employed by such Department has
22 failed to file returns under this Act or pay the tax, penalty
23 and interest shown therein. For purposes of this paragraph,
24 the word "Department" shall have the same meaning as provided
25 in Section 3 of the State Employees Group Insurance Act of
26 1971.
27 (d) The Director shall make available for public
28 inspection in the Department's principal office and for
29 publication, at cost, administrative decisions issued on or
30 after January 1, 1995. These decisions are to be made
31 available in a manner so that the following taxpayer
32 information is not disclosed:
33 (1) The names, addresses, and identification
34 numbers of the taxpayer, related entities, and employees.
SB856 Enrolled -47- LRB9000732KDcbA
1 (2) At the sole discretion of the Director, trade
2 secrets or other confidential information identified as
3 such by the taxpayer, no later than 30 days after receipt
4 of an administrative decision, by such means as the
5 Department shall provide by rule.
6 The Director shall determine the appropriate extent of
7 the deletions allowed in paragraph (2). In the event the
8 taxpayer does not submit deletions, the Director shall make
9 only the deletions specified in paragraph (1).
10 The Director shall make available for public inspection
11 and publication an administrative decision within 180 days
12 after the issuance of the administrative decision. The term
13 "administrative decision" has the same meaning as defined in
14 Section 3-101 of Article III of the Code of Civil Procedure.
15 Costs collected under this Section shall be paid into the Tax
16 Compliance and Administration Fund.
17 (e) Nothing contained in this Act shall prevent the
18 Director from divulging information to any person pursuant to
19 a request or authorization made by the taxpayer, by an
20 authorized representative of the taxpayer, or, in the case of
21 information related to a joint return, by the spouse filing
22 the joint return with the taxpayer.
23 (Source: P.A. 88-669, eff. 11-29-94.)
24 (Text of Section after amendment by P.A. 89-507)
25 Sec. 917. Confidentiality and information sharing.
26 (a) Confidentiality. Except as provided in this Section,
27 all information received by the Department from returns filed
28 under this Act, or from any investigation conducted under the
29 provisions of this Act, shall be confidential, except for
30 official purposes within the Department or pursuant to
31 official procedures for collection of any State tax or
32 pursuant to an investigation or audit by the Illinois State
33 Scholarship Commission of a delinquent student loan or
34 monetary award or enforcement of any civil or criminal
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1 penalty or sanction imposed by this Act or by another statute
2 imposing a State tax, and any person who divulges any such
3 information in any manner, except for such purposes and
4 pursuant to order of the Director or in accordance with a
5 proper judicial order, shall be guilty of a Class A
6 misdemeanor. However, the provisions of this paragraph are
7 not applicable to information furnished to a licensed
8 attorney representing the taxpayer where an appeal or a
9 protest has been filed on behalf of the taxpayer.
10 (b) Public information. Nothing contained in this Act
11 shall prevent the Director from publishing or making
12 available to the public the names and addresses of persons
13 filing returns under this Act, or from publishing or making
14 available reasonable statistics concerning the operation of
15 the tax wherein the contents of returns are grouped into
16 aggregates in such a way that the information contained in
17 any individual return shall not be disclosed.
18 (c) Governmental agencies. The Director may make
19 available to the Secretary of the Treasury of the United
20 States or his delegate, or the proper officer or his delegate
21 of any other state imposing a tax upon or measured by income,
22 for exclusively official purposes, information received by
23 the Department in the administration of this Act, but such
24 permission shall be granted only if the United States or such
25 other state, as the case may be, grants the Department
26 substantially similar privileges. The Director may exchange
27 information with the Illinois Department of Public Aid and
28 the Department of Human Services (acting as successor to the
29 Department of Public Aid under the Department of Human
30 Services Act) for the purpose of verifying sources and
31 amounts of income and for other purposes directly connected
32 with the administration of this Act and the Illinois Public
33 Aid Code. The Director may exchange information with the
34 Director of the Department of Employment Security for the
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1 purpose of verifying sources and amounts of income and for
2 other purposes directly connected with the administration of
3 this Act and Acts administered by the Department of
4 Employment Security. The Director may make available to the
5 Illinois Industrial Commission information regarding
6 employers for the purpose of verifying the insurance coverage
7 required under the Workers' Compensation Act and Workers'
8 Occupational Diseases Act.
9 The Director may make available to any State agency,
10 including the Illinois Supreme Court, which licenses persons
11 to engage in any occupation, information that a person
12 licensed by such agency has failed to file returns under this
13 Act or pay the tax, penalty and interest shown therein, or
14 has failed to pay any final assessment of tax, penalty or
15 interest due under this Act. The Director may also make
16 available to the Secretary of State information that a
17 corporation which has been issued a certificate of
18 incorporation by the Secretary of State has failed to file
19 returns under this Act or pay the tax, penalty and interest
20 shown therein, or has failed to pay any final assessment of
21 tax, penalty or interest due under this Act. An assessment is
22 final when all proceedings in court for review of such
23 assessment have terminated or the time for the taking thereof
24 has expired without such proceedings being instituted. For
25 taxable years ending on or after December 31, 1987, the
26 Director may make available to the Director or principal
27 officer of any Department of the State of Illinois,
28 information that a person employed by such Department has
29 failed to file returns under this Act or pay the tax, penalty
30 and interest shown therein. For purposes of this paragraph,
31 the word "Department" shall have the same meaning as provided
32 in Section 3 of the State Employees Group Insurance Act of
33 1971.
34 (d) The Director shall make available for public
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1 inspection in the Department's principal office and for
2 publication, at cost, administrative decisions issued on or
3 after January 1, 1995. These decisions are to be made
4 available in a manner so that the following taxpayer
5 information is not disclosed:
6 (1) The names, addresses, and identification
7 numbers of the taxpayer, related entities, and employees.
8 (2) At the sole discretion of the Director, trade
9 secrets or other confidential information identified as
10 such by the taxpayer, no later than 30 days after receipt
11 of an administrative decision, by such means as the
12 Department shall provide by rule.
13 The Director shall determine the appropriate extent of
14 the deletions allowed in paragraph (2). In the event the
15 taxpayer does not submit deletions, the Director shall make
16 only the deletions specified in paragraph (1).
17 The Director shall make available for public inspection
18 and publication an administrative decision within 180 days
19 after the issuance of the administrative decision. The term
20 "administrative decision" has the same meaning as defined in
21 Section 3-101 of Article III of the Code of Civil Procedure.
22 Costs collected under this Section shall be paid into the Tax
23 Compliance and Administration Fund.
24 (e) Nothing contained in this Act shall prevent the
25 Director from divulging information to any person pursuant to
26 a request or authorization made by the taxpayer, by an
27 authorized representative of the taxpayer, or, in the case of
28 information related to a joint return, by the spouse filing
29 the joint return with the taxpayer.
30 (Source: P.A. 88-669, eff. 11-29-94; 89-507, eff. 7-1-97.)
31 Section 20. The Use Tax Act is amended by changing
32 Sections 9 and 20 as follows:
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1 (35 ILCS 105/9) (from Ch. 120, par. 439.9)
2 Sec. 9. Except as to motor vehicles, watercraft,
3 aircraft, and trailers that are required to be registered
4 with an agency of this State, each retailer required or
5 authorized to collect the tax imposed by this Act shall pay
6 to the Department the amount of such tax (except as otherwise
7 provided) at the time when he is required to file his return
8 for the period during which such tax was collected, less a
9 discount of 2.1% prior to January 1, 1990, and 1.75% on and
10 after January 1, 1990, or $5 per calendar year, whichever is
11 greater, which is allowed to reimburse the retailer for
12 expenses incurred in collecting the tax, keeping records,
13 preparing and filing returns, remitting the tax and supplying
14 data to the Department on request. In the case of retailers
15 who report and pay the tax on a transaction by transaction
16 basis, as provided in this Section, such discount shall be
17 taken with each such tax remittance instead of when such
18 retailer files his periodic return. A retailer need not
19 remit that part of any tax collected by him to the extent
20 that he is required to remit and does remit the tax imposed
21 by the Retailers' Occupation Tax Act, with respect to the
22 sale of the same property.
23 Where such tangible personal property is sold under a
24 conditional sales contract, or under any other form of sale
25 wherein the payment of the principal sum, or a part thereof,
26 is extended beyond the close of the period for which the
27 return is filed, the retailer, in collecting the tax (except
28 as to motor vehicles, watercraft, aircraft, and trailers that
29 are required to be registered with an agency of this State),
30 may collect for each tax return period, only the tax
31 applicable to that part of the selling price actually
32 received during such tax return period.
33 Except as provided in this Section, on or before the
34 twentieth day of each calendar month, such retailer shall
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1 file a return for the preceding calendar month. Such return
2 shall be filed on forms prescribed by the Department and
3 shall furnish such information as the Department may
4 reasonably require.
5 The Department may require returns to be filed on a
6 quarterly basis. If so required, a return for each calendar
7 quarter shall be filed on or before the twentieth day of the
8 calendar month following the end of such calendar quarter.
9 The taxpayer shall also file a return with the Department for
10 each of the first two months of each calendar quarter, on or
11 before the twentieth day of the following calendar month,
12 stating:
13 1. The name of the seller;
14 2. The address of the principal place of business
15 from which he engages in the business of selling tangible
16 personal property at retail in this State;
17 3. The total amount of taxable receipts received by
18 him during the preceding calendar month from sales of
19 tangible personal property by him during such preceding
20 calendar month, including receipts from charge and time
21 sales, but less all deductions allowed by law;
22 4. The amount of credit provided in Section 2d of
23 this Act;
24 5. The amount of tax due;
25 5-5. The signature of the taxpayer; and
26 6. Such other reasonable information as the
27 Department may require.
28 If a taxpayer fails to sign a return within 30 days after
29 the proper notice and demand for signature by the Department,
30 the return shall be considered valid and any amount shown to
31 be due on the return shall be deemed assessed.
32 Beginning October 1, 1993, a taxpayer who has an average
33 monthly tax liability of $150,000 or more shall make all
34 payments required by rules of the Department by electronic
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1 funds transfer. Beginning October 1, 1994, a taxpayer who has
2 an average monthly tax liability of $100,000 or more shall
3 make all payments required by rules of the Department by
4 electronic funds transfer. Beginning October 1, 1995, a
5 taxpayer who has an average monthly tax liability of $50,000
6 or more shall make all payments required by rules of the
7 Department by electronic funds transfer. The term "average
8 monthly tax liability" means the sum of the taxpayer's
9 liabilities under this Act, and under all other State and
10 local occupation and use tax laws administered by the
11 Department, for the immediately preceding calendar year
12 divided by 12.
13 Before August 1 of each year beginning in 1993, the
14 Department shall notify all taxpayers required to make
15 payments by electronic funds transfer. All taxpayers required
16 to make payments by electronic funds transfer shall make
17 those payments for a minimum of one year beginning on October
18 1.
19 Any taxpayer not required to make payments by electronic
20 funds transfer may make payments by electronic funds transfer
21 with the permission of the Department.
22 All taxpayers required to make payment by electronic
23 funds transfer and any taxpayers authorized to voluntarily
24 make payments by electronic funds transfer shall make those
25 payments in the manner authorized by the Department.
26 The Department shall adopt such rules as are necessary to
27 effectuate a program of electronic funds transfer and the
28 requirements of this Section.
29 If the taxpayer's average monthly tax liability to the
30 Department under this Act, the Retailers' Occupation Tax Act,
31 the Service Occupation Tax Act, the Service Use Tax Act was
32 $10,000 or more during the preceding 4 complete calendar
33 quarters, he shall file a return with the Department each
34 month by the 20th day of the month next following the month
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1 during which such tax liability is incurred and shall make
2 payments to the Department on or before the 7th, 15th, 22nd
3 and last day of the month during which such liability is
4 incurred. If the month during which such tax liability is
5 incurred began prior to January 1, 1985, each payment shall
6 be in an amount equal to 1/4 of the taxpayer's actual
7 liability for the month or an amount set by the Department
8 not to exceed 1/4 of the average monthly liability of the
9 taxpayer to the Department for the preceding 4 complete
10 calendar quarters (excluding the month of highest liability
11 and the month of lowest liability in such 4 quarter period).
12 If the month during which such tax liability is incurred
13 begins on or after January 1, 1985, and prior to January 1,
14 1987, each payment shall be in an amount equal to 22.5% of
15 the taxpayer's actual liability for the month or 27.5% of the
16 taxpayer's liability for the same calendar month of the
17 preceding year. If the month during which such tax liability
18 is incurred begins on or after January 1, 1987, and prior to
19 January 1, 1988, each payment shall be in an amount equal to
20 22.5% of the taxpayer's actual liability for the month or
21 26.25% of the taxpayer's liability for the same calendar
22 month of the preceding year. If the month during which such
23 tax liability is incurred begins on or after January 1, 1988,
24 and prior to January 1, 1989, or begins on or after January
25 1, 1996, each payment shall be in an amount equal to 22.5% of
26 the taxpayer's actual liability for the month or 25% of the
27 taxpayer's liability for the same calendar month of the
28 preceding year. If the month during which such tax liability
29 is incurred begins on or after January 1, 1989, and prior to
30 January 1, 1996, each payment shall be in an amount equal to
31 22.5% of the taxpayer's actual liability for the month or 25%
32 of the taxpayer's liability for the same calendar month of
33 the preceding year or 100% of the taxpayer's actual liability
34 for the quarter monthly reporting period. The amount of such
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1 quarter monthly payments shall be credited against the final
2 tax liability of the taxpayer's return for that month. Once
3 applicable, the requirement of the making of quarter monthly
4 payments to the Department shall continue until such
5 taxpayer's average monthly liability to the Department during
6 the preceding 4 complete calendar quarters (excluding the
7 month of highest liability and the month of lowest liability)
8 is less than $9,000, or until such taxpayer's average monthly
9 liability to the Department as computed for each calendar
10 quarter of the 4 preceding complete calendar quarter period
11 is less than $10,000. However, if a taxpayer can show the
12 Department that a substantial change in the taxpayer's
13 business has occurred which causes the taxpayer to anticipate
14 that his average monthly tax liability for the reasonably
15 foreseeable future will fall below $10,000, then such
16 taxpayer may petition the Department for change in such
17 taxpayer's reporting status. The Department shall change
18 such taxpayer's reporting status unless it finds that such
19 change is seasonal in nature and not likely to be long term.
20 If any such quarter monthly payment is not paid at the time
21 or in the amount required by this Section, then the taxpayer
22 shall be liable for penalties and interest on taxpayer's 2.1%
23 or 1.75% vendors' discount shall be reduced by 2.1% or 1.75%,
24 as the case may be, of the difference between the minimum
25 amount due and the amount of such quarter monthly payment
26 actually and timely paid and the taxpayer shall be liable for
27 penalties and interest on such difference, except insofar as
28 the taxpayer has previously made payments for that month to
29 the Department in excess of the minimum payments previously
30 due as provided in this Section. The Department shall make
31 reasonable rules and regulations to govern the quarter
32 monthly payment amount and quarter monthly payment dates for
33 taxpayers who file on other than a calendar monthly basis.
34 If any such payment provided for in this Section exceeds
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1 the taxpayer's liabilities under this Act, the Retailers'
2 Occupation Tax Act, the Service Occupation Tax Act and the
3 Service Use Tax Act, as shown by an original monthly return,
4 the Department shall issue to the taxpayer a credit
5 memorandum no later than 30 days after the date of payment,
6 which memorandum may be submitted by the taxpayer to the
7 Department in payment of tax liability subsequently to be
8 remitted by the taxpayer to the Department or be assigned by
9 the taxpayer to a similar taxpayer under this Act, the
10 Retailers' Occupation Tax Act, the Service Occupation Tax Act
11 or the Service Use Tax Act, in accordance with reasonable
12 rules and regulations to be prescribed by the Department,
13 except that if such excess payment is shown on an original
14 monthly return and is made after December 31, 1986, no credit
15 memorandum shall be issued, unless requested by the taxpayer.
16 If no such request is made, the taxpayer may credit such
17 excess payment against tax liability subsequently to be
18 remitted by the taxpayer to the Department under this Act,
19 the Retailers' Occupation Tax Act, the Service Occupation Tax
20 Act or the Service Use Tax Act, in accordance with reasonable
21 rules and regulations prescribed by the Department. If the
22 Department subsequently determines that all or any part of
23 the credit taken was not actually due to the taxpayer, the
24 taxpayer's 2.1% or 1.75% vendor's discount shall be reduced
25 by 2.1% or 1.75% of the difference between the credit taken
26 and that actually due, and the taxpayer shall be liable for
27 penalties and interest on such difference.
28 If the retailer is otherwise required to file a monthly
29 return and if the reta