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| [ Introduced ] | [ House Amendment 001 ] |
91_SB1929eng SB1929 Engrossed LRB9111995SMdv 1 AN ACT in relation to taxes. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 1. Short title. This Act may be cited as the 5 Qualified Technological Equipment Leasing Occupation and Use 6 Tax Act. 7 Section 5. Definitions. As used in this Act, the 8 following terms have the following meanings: 9 "Access fees" means fees that an interexchange carrier 10 pays to a local exchange carrier for the use of its local 11 network to originate or terminate communication services. 12 "Computer" means a programmable electronically activated 13 device that: 14 (a) is capable of accepting information, applying 15 prescribed processes as to the information, and supplying the 16 results of these processes with or without human 17 intervention, and 18 (b) consists of a central processing unit containing 19 extensive storage, logic, arithmetic, and control 20 capabilities. 21 "Computer or peripheral equipment" means: 22 (a) any computer, and 23 (b) any related peripheral equipment, however 24 (c) the term "computer or peripheral equipment" does not 25 include: 26 (i) any equipment that is an integral part of other 27 property that is not a computer, 28 (ii) typewriters, calculators, adding and 29 accounting machines, copiers, duplicating equipment, and 30 similar equipment, and 31 (iii) equipment of a kind used primarily for SB1929 Engrossed -2- LRB9111995SMdv 1 amusement or entertainment of the user. 2 "Department" means the Department of Revenue. 3 "High technology medical equipment" means any electronic, 4 electromechanical, or computer-based high technology 5 equipment used in the screening, monitoring, observation, 6 diagnosis, or treatment of patients in a laboratory, medical, 7 or hospital environment. 8 "Person" means any natural individual, limited liability 9 company, firm, partnership, association, joint stock company, 10 joint venture, public or private corporation, or a receiver, 11 executor, trustee, conservator, or other representatives 12 appointed by order of any court. 13 "Leasing" means any transfer of the possession or right 14 to possession of qualified technological equipment to a user 15 for valuable consideration, for the purpose of use and not 16 for the purpose of re-lease or sublease. 17 "Lessor" means any person primarily engaged in the 18 business of leasing tangible personal property to users. For 19 this purpose, the objective of making a profit is not 20 necessary to make the leasing activity a business. For 21 purposes of this definition, "primarily" means deriving more 22 than 50% of gross revenue from the business of leasing 23 tangible personal property to users. Gross revenue from the 24 business of leasing tangible personal property to users does 25 not include access fees. 26 "Lessee" means any user to whom the possession, or the 27 right to possession, of qualified technological equipment is 28 transferred for a valuable consideration that is paid by such 29 "lessee" or by someone else. 30 "Gross receipts" means the total leasing price for the 31 lease of qualified technological equipment. In the case of 32 lease transactions in which the consideration is paid to the 33 lessor on an installment basis, the amounts of such payments 34 shall be included by the lessor in gross receipts only as and SB1929 Engrossed -3- LRB9111995SMdv 1 when payments are received by the lessor. 2 "Leasing price" means the consideration for leasing 3 qualified technological equipment valued in money, whether 4 received in money or otherwise, including cash, credits, 5 property, and services, and shall be determined without any 6 deduction on account of the cost of the property leased, the 7 cost of materials used, labor or service cost, or any other 8 expense whatsoever, but does not include charges that are 9 added by lessors on account of the lessor's tax liability 10 under this Act, or on account of the lessor's duty to 11 collect, from the lessee, the tax that is imposed by Section 12 20 of this Act. 13 "Maintaining a place of business in this State" means 14 having or maintaining within this State, directly or by a 15 subsidiary, an office, repair facilities, distribution house, 16 sales house, warehouse, or other place of business, or any 17 agent, or other representative, operating within this State, 18 irrespective of whether the place of business or agent or 19 other representative is located here permanently or 20 temporarily. 21 "Qualified technological equipment" for purposes of this 22 Act means the following: 23 (a) any computer or peripheral equipment; and 24 (b) any high technology medical equipment. 25 "Related peripheral equipment" means any auxiliary 26 machine (whether on-line or off-line) that is designed to be 27 placed under the control of the central processing unit of a 28 computer. 29 Section 10. Imposition of occupation tax. Beginning with 30 leases for periods of one year or more entered into on and 31 after January 1, 2001, a tax is imposed upon lessors engaged 32 in this State in the business of leasing qualified 33 technological equipment in Illinois at the rate of 6.25% of SB1929 Engrossed -4- LRB9111995SMdv 1 the gross receipts received from the business. The tax 2 imposed by this Section does not apply to access fees. 3 The Department shall have full power to administer and 4 enforce this Section, to collect all taxes and penalties due 5 hereunder, to dispose of taxes and penalties so collected in 6 the manner hereinafter provided, and to determine all rights 7 to credit memoranda, arising on account of the erroneous 8 payment of tax or penalty hereunder. In the administration 9 of, and compliance with, this Section, the Department and 10 persons who are subject to this Section shall have the same 11 rights, remedies, privileges, immunities, powers and duties, 12 and be subject to the same conditions, restrictions, 13 limitations, penalties, and definitions of terms, and employ 14 the same modes of procedure, as are prescribed in Sections 1, 15 la, 2 through 2-65 (except as to the rate of tax), 2a, 2b, 16 2c, 3 (except provisions relating to transaction returns and 17 quarter monthly payments), 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g, 18 5i, 5j, 6, 6a, 6b, 6c, 7, 8, 9, 10, 11, 11a, 12 and 13 of the 19 Retailers' Occupation Tax Act that are not inconsistent with 20 this Act and all Sections of the Uniform Penalty and Interest 21 Act as fully as if those provisions were set forth herein. 22 For purposes of this Section, references in such incorporated 23 Sections of the Retailers' Occupation Tax Act to retailers, 24 sellers, or persons engaged in the business of selling 25 tangible personal property means persons engaged in the 26 leasing of qualified technological equipment under leases 27 subject to this Act. 28 Each month the Department shall pay into the Local 29 Government Distributive Fund 20% of the net revenue realized 30 for the preceding month from the 6.25% tax imposed in this 31 Section. These amounts shall be distributed in the manner 32 provided in Section 2 of the State Revenue Sharing Act. The 33 remaining 80% of the revenue shall be paid as provided for in 34 Section 3 of the Retailers' Occupation Tax Act. SB1929 Engrossed -5- LRB9111995SMdv 1 Section 15. Registration. Every person engaged in this 2 State in the business of leasing qualified technological 3 equipment shall apply to the Department (upon a form 4 prescribed and furnished by the Department) for a certificate 5 of registration under this Act. The certificate of 6 registration that is issued by the Department to a retailer 7 under the Retailers' Occupation Tax Act shall permit the 8 lessor to engage in a business that is taxable under this 9 Section without registering separately with the Department. 10 Section 20. Imposition of use tax. Beginning with leases 11 for periods of one year or more entered into on and after 12 January 1, 2001, a tax is imposed upon the privilege of using 13 in this State qualified technological equipment that is 14 leased from a lessor. The tax is at the rate of 6.25% of the 15 leasing price of the qualified technological equipment paid 16 to the lessor under any lease agreement. 17 It is presumed that a lessee has not leased from a lessor 18 if the lessor fails to show the tax imposed by this Act on an 19 invoice to the lessee. The presumption shall not, however, 20 prevent the Department from proceeding against the lessor for 21 any tax due under the provisions of this Act or the Use Tax 22 Act, whichever applies. The tax imposed by this Section does 23 not apply to access fees. 24 The Department shall have full power to administer and 25 enforce this Section; to collect all taxes, penalties, and 26 interest due hereunder; to dispose of taxes, penalties, and 27 interest so collected in the manner hereinafter provided; and 28 to determine all rights to credit memoranda or refunds 29 arising on account of the erroneous payment of tax, penalty, 30 or interest hereunder. In the administration of, and 31 compliance with, this Section, the Department and persons who 32 are subject to this Section shall have the same rights, 33 remedies, privileges, immunities, powers, and duties, and be SB1929 Engrossed -6- LRB9111995SMdv 1 subject to the same conditions, restrictions, limitations, 2 penalties, and definitions of terms, and employ the same 3 modes of procedure, as are prescribed in Sections 2, 3 4 through 3-80 (except as to the rate of tax), 4, 6, 7, 8, 9 5 (except provisions relating to transaction returns and 6 quarter monthly payments), 10, 11, 12, 12a, 12b, 13, 14, 15, 7 19, 20, 21 and 22 of the Use Tax Act that are not 8 inconsistent with this Act as fully as if those provisions 9 were set forth herein. For purposes of this Section, 10 references in such incorporated Sections of the Use Tax Act 11 to users or purchasers means lessees of qualified 12 technological equipment under leases subject to this Act. 13 Each month the Department shall pay into the Local 14 Government Distributive Fund 20% of the net revenue realized 15 for the preceding month from the 6.25% tax imposed in this 16 Section. These amounts shall be distributed in the manner 17 provided in Section 2 of the State Revenue Sharing Act. The 18 remaining 80% of the revenue shall be paid as provided for in 19 Section 9 of the Use Tax Act. 20 Section 25. Exemption due to prior taxation. The taxes 21 imposed under Sections 10 and 20 of this Act do not apply to 22 leases of qualified technological equipment as defined in 23 this Act if the lessor had properly paid, prior to January 1, 24 2001, Illinois use tax or service use tax to a retailer or 25 directly to the Department on the purchase or use of such 26 leased property. 27 Section 30. Use tax collected. The use tax imposed by 28 Section 20 shall be collected from the lessee and remitted to 29 the Department by a lessor maintaining a place of business in 30 this State. 31 The use tax imposed by Section 20 and not paid to a 32 lessor pursuant to the preceding paragraph of this Section SB1929 Engrossed -7- LRB9111995SMdv 1 shall be paid to the Department directly by any person using 2 the leased qualified technological equipment within this 3 State. 4 Lessors shall collect the tax from lessees by adding the 5 tax to the leasing price of the qualified technological 6 equipment in the manner prescribed by the Department. The 7 Department shall have the power to adopt and promulgate 8 reasonable rules and regulations for the adding of the tax by 9 lessors to leasing prices by prescribing bracket systems for 10 the purpose of enabling the lessors to add and collect, as 11 far as practicable, the amount of the tax. 12 The tax imposed by this Act shall, when collected, be 13 stated as a distinct item on the customer's bill, separate 14 and apart from the leasing price of the qualified 15 technological equipment. 16 Section 35. Exemption for manufacturer-lessors. In the 17 case of a manufacturer which is the lessor of qualified 18 technological equipment which the manufacturer-lessor has 19 manufactured, the tax imposed by this Act shall not apply 20 and, in lieu thereof, the manufacturer-lessor shall pay use 21 tax pursuant to the Use Tax Act and regulations thereunder. 22 Section 40. Opt out for lessees. As to each 23 transaction, a qualified lessee shall have the right to 24 direct the lessor not to pay the State of Illinois, nor 25 collect from the qualified lessee, tax under this Act and, in 26 lieu thereof, to pay tax pursuant to the Retailers' 27 Occupation Tax Act or the Use Tax Act, whichever may apply. 28 For purposes of this Section, "transaction" means a leasing 29 contract between a qualified lessee and a lessor. Under a 30 blanket or master contract which is implemented by the 31 lessee's placing of a lease schedule or similar document, 32 each lease schedule or similar document shall be considered a SB1929 Engrossed -8- LRB9111995SMdv 1 separate leasing contract. For the purposes of this Section, 2 "qualified lessee" means any lessee which has its corporate 3 headquarters in Illinois in a municipality with a population 4 of 100,000 or more, has 3 or more manufacturing facilities in 5 Illinois, has its common stock listed on the New York Stock 6 Exchange, has annual sales of $10 billion per year or more, 7 and manufactures at least 2 of the following in Illinois: 8 heavy duty machines, construction machines, material handling 9 machines, or diesel engines. The definition of what 10 constitutes a heavy duty machine, a construction machine, a 11 material handling machine, or a diesel engine shall be the 12 definition used by the qualified lessee in the ordinary 13 course of its business. 14 Section 45. Severability clause. If any clause, sentence, 15 Section, provision, or part thereof of this Act or the 16 application thereof to any person or circumstance shall be 17 adjudged to be unconstitutional, the remainder of this Act or 18 its application to persons or circumstances other than those 19 to which it is held invalid, shall not be affected thereby. 20 In particular, if any provision that exempts or has the 21 effect of exempting some class of users or some kind of use 22 from the tax imposed by this Act should be held to constitute 23 or to result in an invalid classification or to be 24 unconstitutional for some other reason, that provision shall 25 be deemed to be severable, with the remainder of this Act 26 without the provision being held constitutional. 27 Section 105. The State Revenue Sharing Act is amended by 28 changing Section 1 as follows: 29 (30 ILCS 115/1) (from Ch. 85, par. 611) 30 Sec. 1. Local Government Distributive Fund. Through June 31 30, 1994, as soon as may be after the first day of each month SB1929 Engrossed -9- LRB9111995SMdv 1 the Department of Revenue shall certify to the Treasurer an 2 amount equal to 1/12 of the net revenue realized from the tax 3 imposed by subsections (a) and (b) of Section 201 of the 4 Illinois Income Tax Act during the preceding month. 5 Beginning July 1, 1994, and continuing through June 30, 1995, 6 as soon as may be after the first day of each month, the 7 Department of Revenue shall certify to the Treasurer an 8 amount equal to 1/11 of the net revenue realized from the tax 9 imposed by subsections (a) and (b) of Section 201 of the 10 Illinois Income Tax Act during the preceding month. Beginning 11 July 1, 1995, as soon as may be after the first day of each 12 month, the Department of Revenue shall certify to the 13 Treasurer an amount equal to 1/10 of the net revenue realized 14 from the tax imposed by subsections (a) and (b) of Section 15 201 of the Illinois Income Tax Act during the preceding 16 month. Net revenue realized for a month shall be defined as 17 the revenue from the tax imposed by subsections (a) and (b) 18 of Section 201 of the Illinois Income Tax Act which is 19 deposited in the General Revenue Fund, the Education 20 Assistance Fund and the Income Tax Surcharge Local Government 21 Distributive Fund during the month minus the amount paid out 22 of the General Revenue Fund in State warrants during that 23 same month as refunds to taxpayers for overpayment of 24 liability under the tax imposed by subsections (a) and (b) of 25 Section 201 of the Illinois Income Tax Act. In addition, 26 beginning January 1, 2001, as soon as may be after the first 27 day of each month, the Department shall certify to the 28 Treasurer an amount equal to 1/5 of the net revenue realized 29 under the Qualified Technological Equipment Leasing 30 Occupation and Use Tax Act. Upon receipt of such 31 certification, the Treasurer shall transfer from the General 32 Revenue Fund to a special fund in the State treasury, to be 33 known as the "Local Government Distributive Fund", the amount 34 shown on such certification. SB1929 Engrossed -10- LRB9111995SMdv 1 All amounts paid into the Local Government Distributive 2 Fund in accordance with this Section and allocated pursuant 3 to this Act are appropriated on a continuing basis. 4 (Source: P.A. 88-89.) 5 Section 110. The Use Tax Act is amended by changing 6 Sections 3-5 and 9 and adding Section 9.5 as follows: 7 (35 ILCS 105/3-5) (from Ch. 120, par. 439.3-5) 8 Sec. 3-5. Exemptions. Use of the following tangible 9 personal property is exempt from the tax imposed by this Act: 10 (1) Personal property purchased from a corporation, 11 society, association, foundation, institution, or 12 organization, other than a limited liability company, that is 13 organized and operated as a not-for-profit service enterprise 14 for the benefit of persons 65 years of age or older if the 15 personal property was not purchased by the enterprise for the 16 purpose of resale by the enterprise. 17 (2) Personal property purchased by a not-for-profit 18 Illinois county fair association for use in conducting, 19 operating, or promoting the county fair. 20 (3) Personal property purchased by a not-for-profit arts 21 or cultural organization that establishes, by proof required 22 by the Department by rule, that it has received an exemption 23 under Section 501(c)(3) of the Internal Revenue Code and that 24 is organized and operated for the presentation or support of 25 arts or cultural programming, activities, or services. These 26 organizations include, but are not limited to, music and 27 dramatic arts organizations such as symphony orchestras and 28 theatrical groups, arts and cultural service organizations, 29 local arts councils, visual arts organizations, and media 30 arts organizations. 31 (4) Personal property purchased by a governmental body, 32 by a corporation, society, association, foundation, or SB1929 Engrossed -11- LRB9111995SMdv 1 institution organized and operated exclusively for 2 charitable, religious, or educational purposes, or by a 3 not-for-profit corporation, society, association, foundation, 4 institution, or organization that has no compensated officers 5 or employees and that is organized and operated primarily for 6 the recreation of persons 55 years of age or older. A limited 7 liability company may qualify for the exemption under this 8 paragraph only if the limited liability company is organized 9 and operated exclusively for educational purposes. On and 10 after July 1, 1987, however, no entity otherwise eligible for 11 this exemption shall make tax-free purchases unless it has an 12 active exemption identification number issued by the 13 Department. 14 (5) A passenger car that is a replacement vehicle to the 15 extent that the purchase price of the car is subject to the 16 Replacement Vehicle Tax. 17 (6) Graphic arts machinery and equipment, including 18 repair and replacement parts, both new and used, and 19 including that manufactured on special order, certified by 20 the purchaser to be used primarily for graphic arts 21 production, and including machinery and equipment purchased 22 for lease. 23 (7) Farm chemicals. 24 (8) Legal tender, currency, medallions, or gold or 25 silver coinage issued by the State of Illinois, the 26 government of the United States of America, or the government 27 of any foreign country, and bullion. 28 (9) Personal property purchased from a teacher-sponsored 29 student organization affiliated with an elementary or 30 secondary school located in Illinois. 31 (10) A motor vehicle of the first division, a motor 32 vehicle of the second division that is a self-contained motor 33 vehicle designed or permanently converted to provide living 34 quarters for recreational, camping, or travel use, with SB1929 Engrossed -12- LRB9111995SMdv 1 direct walk through to the living quarters from the driver's 2 seat, or a motor vehicle of the second division that is of 3 the van configuration designed for the transportation of not 4 less than 7 nor more than 16 passengers, as defined in 5 Section 1-146 of the Illinois Vehicle Code, that is used for 6 automobile renting, as defined in the Automobile Renting 7 Occupation and Use Tax Act. 8 (11) Farm machinery and equipment, both new and used, 9 including that manufactured on special order, certified by 10 the purchaser to be used primarily for production agriculture 11 or State or federal agricultural programs, including 12 individual replacement parts for the machinery and equipment, 13 including machinery and equipment purchased for lease, and 14 including implements of husbandry defined in Section 1-130 of 15 the Illinois Vehicle Code, farm machinery and agricultural 16 chemical and fertilizer spreaders, and nurse wagons required 17 to be registered under Section 3-809 of the Illinois Vehicle 18 Code, but excluding other motor vehicles required to be 19 registered under the Illinois Vehicle Code. Horticultural 20 polyhouses or hoop houses used for propagating, growing, or 21 overwintering plants shall be considered farm machinery and 22 equipment under this item (11). Agricultural chemical tender 23 tanks and dry boxes shall include units sold separately from 24 a motor vehicle required to be licensed and units sold 25 mounted on a motor vehicle required to be licensed if the 26 selling price of the tender is separately stated. 27 Farm machinery and equipment shall include precision 28 farming equipment that is installed or purchased to be 29 installed on farm machinery and equipment including, but not 30 limited to, tractors, harvesters, sprayers, planters, 31 seeders, or spreaders. Precision farming equipment includes, 32 but is not limited to, soil testing sensors, computers, 33 monitors, software, global positioning and mapping systems, 34 and other such equipment. SB1929 Engrossed -13- LRB9111995SMdv 1 Farm machinery and equipment also includes computers, 2 sensors, software, and related equipment used primarily in 3 the computer-assisted operation of production agriculture 4 facilities, equipment, and activities such as, but not 5 limited to, the collection, monitoring, and correlation of 6 animal and crop data for the purpose of formulating animal 7 diets and agricultural chemicals. This item (11) is exempt 8 from the provisions of Section 3-90. 9 (12) Fuel and petroleum products sold to or used by an 10 air common carrier, certified by the carrier to be used for 11 consumption, shipment, or storage in the conduct of its 12 business as an air common carrier, for a flight destined for 13 or returning from a location or locations outside the United 14 States without regard to previous or subsequent domestic 15 stopovers. 16 (13) Proceeds of mandatory service charges separately 17 stated on customers' bills for the purchase and consumption 18 of food and beverages purchased at retail from a retailer, to 19 the extent that the proceeds of the service charge are in 20 fact turned over as tips or as a substitute for tips to the 21 employees who participate directly in preparing, serving, 22 hosting or cleaning up the food or beverage function with 23 respect to which the service charge is imposed. 24 (14) Oil field exploration, drilling, and production 25 equipment, including (i) rigs and parts of rigs, rotary rigs, 26 cable tool rigs, and workover rigs, (ii) pipe and tubular 27 goods, including casing and drill strings, (iii) pumps and 28 pump-jack units, (iv) storage tanks and flow lines, (v) any 29 individual replacement part for oil field exploration, 30 drilling, and production equipment, and (vi) machinery and 31 equipment purchased for lease; but excluding motor vehicles 32 required to be registered under the Illinois Vehicle Code. 33 (15) Photoprocessing machinery and equipment, including 34 repair and replacement parts, both new and used, including SB1929 Engrossed -14- LRB9111995SMdv 1 that manufactured on special order, certified by the 2 purchaser to be used primarily for photoprocessing, and 3 including photoprocessing machinery and equipment purchased 4 for lease. 5 (16) Coal exploration, mining, offhighway hauling, 6 processing, maintenance, and reclamation equipment, including 7 replacement parts and equipment, and including equipment 8 purchased for lease, but excluding motor vehicles required to 9 be registered under the Illinois Vehicle Code. 10 (17) Distillation machinery and equipment, sold as a 11 unit or kit, assembled or installed by the retailer, 12 certified by the user to be used only for the production of 13 ethyl alcohol that will be used for consumption as motor fuel 14 or as a component of motor fuel for the personal use of the 15 user, and not subject to sale or resale. 16 (18) Manufacturing and assembling machinery and 17 equipment used primarily in the process of manufacturing or 18 assembling tangible personal property for wholesale or retail 19 sale or lease, whether that sale or lease is made directly by 20 the manufacturer or by some other person, whether the 21 materials used in the process are owned by the manufacturer 22 or some other person, or whether that sale or lease is made 23 apart from or as an incident to the seller's engaging in the 24 service occupation of producing machines, tools, dies, jigs, 25 patterns, gauges, or other similar items of no commercial 26 value on special order for a particular purchaser. 27 (19) Personal property delivered to a purchaser or 28 purchaser's donee inside Illinois when the purchase order for 29 that personal property was received by a florist located 30 outside Illinois who has a florist located inside Illinois 31 deliver the personal property. 32 (20) Semen used for artificial insemination of livestock 33 for direct agricultural production. 34 (21) Horses, or interests in horses, registered with and SB1929 Engrossed -15- LRB9111995SMdv 1 meeting the requirements of any of the Arabian Horse Club 2 Registry of America, Appaloosa Horse Club, American Quarter 3 Horse Association, United States Trotting Association, or 4 Jockey Club, as appropriate, used for purposes of breeding or 5 racing for prizes. 6 (22) Computers and communications equipment utilized for 7 any hospital purpose and equipment used in the diagnosis, 8 analysis, or treatment of hospital patients purchased by a 9 lessor who leases the equipment, under a lease of one year or 10 longer executed or in effect at the time the lessor would 11 otherwise be subject to the tax imposed by this Act, to a 12 hospital that has been issued an active tax exemption 13 identification number by the Department under Section 1g of 14 the Retailers' Occupation Tax Act. If the equipment is 15 leased in a manner that does not qualify for this exemption 16 or is used in any other non-exempt manner, the lessor shall 17 be liable for the tax imposed under this Act or the Service 18 Use Tax Act, as the case may be, based on the fair market 19 value of the property at the time the non-qualifying use 20 occurs. No lessor shall collect or attempt to collect an 21 amount (however designated) that purports to reimburse that 22 lessor for the tax imposed by this Act or the Service Use Tax 23 Act, as the case may be, if the tax has not been paid by the 24 lessor. If a lessor improperly collects any such amount from 25 the lessee, the lessee shall have a legal right to claim a 26 refund of that amount from the lessor. If, however, that 27 amount is not refunded to the lessee for any reason, the 28 lessor is liable to pay that amount to the Department. This 29 paragraph is exempt from the provisions of Section 3-90. 30 (23) Personal property purchased by a lessor who leases 31 the property, under a lease of one year or longer executed 32 or in effect at the time the lessor would otherwise be 33 subject to the tax imposed by this Act, to a governmental 34 body that has been issued an active sales tax exemption SB1929 Engrossed -16- LRB9111995SMdv 1 identification number by the Department under Section 1g of 2 the Retailers' Occupation Tax Act. If the property is leased 3 in a manner that does not qualify for this exemption or used 4 in any other non-exempt manner, the lessor shall be liable 5 for the tax imposed under this Act or the Service Use Tax 6 Act, as the case may be, based on the fair market value of 7 the property at the time the non-qualifying use occurs. No 8 lessor shall collect or attempt to collect an amount (however 9 designated) that purports to reimburse that lessor for the 10 tax imposed by this Act or the Service Use Tax Act, as the 11 case may be, if the tax has not been paid by the lessor. If 12 a lessor improperly collects any such amount from the lessee, 13 the lessee shall have a legal right to claim a refund of that 14 amount from the lessor. If, however, that amount is not 15 refunded to the lessee for any reason, the lessor is liable 16 to pay that amount to the Department. This paragraph is 17 exempt from the provisions of Section 3-90. 18 (24) Beginning with taxable years ending on or after 19 December 31, 1995 and ending with taxable years ending on or 20 before December 31, 2004, personal property that is donated 21 for disaster relief to be used in a State or federally 22 declared disaster area in Illinois or bordering Illinois by a 23 manufacturer or retailer that is registered in this State to 24 a corporation, society, association, foundation, or 25 institution that has been issued a sales tax exemption 26 identification number by the Department that assists victims 27 of the disaster who reside within the declared disaster area. 28 (25) Beginning with taxable years ending on or after 29 December 31, 1995 and ending with taxable years ending on or 30 before December 31, 2004, personal property that is used in 31 the performance of infrastructure repairs in this State, 32 including but not limited to municipal roads and streets, 33 access roads, bridges, sidewalks, waste disposal systems, 34 water and sewer line extensions, water distribution and SB1929 Engrossed -17- LRB9111995SMdv 1 purification facilities, storm water drainage and retention 2 facilities, and sewage treatment facilities, resulting from a 3 State or federally declared disaster in Illinois or bordering 4 Illinois when such repairs are initiated on facilities 5 located in the declared disaster area within 6 months after 6 the disaster. 7 (26) Beginning July 1, 1999, game or game birds 8 purchased at a "game breeding and hunting preserve area" or 9 an "exotic game hunting area" as those terms are used in the 10 Wildlife Code or at a hunting enclosure approved through 11 rules adopted by the Department of Natural Resources. This 12 paragraph is exempt from the provisions of Section 3-90. 13 (27)(26)A motor vehicle, as that term is defined in 14 Section 1-146 of the Illinois Vehicle Code, that is donated 15 to a corporation, limited liability company, society, 16 association, foundation, or institution that is determined by 17 the Department to be organized and operated exclusively for 18 educational purposes. For purposes of this exemption, "a 19 corporation, limited liability company, society, association, 20 foundation, or institution organized and operated exclusively 21 for educational purposes" means all tax-supported public 22 schools, private schools that offer systematic instruction in 23 useful branches of learning by methods common to public 24 schools and that compare favorably in their scope and 25 intensity with the course of study presented in tax-supported 26 schools, and vocational or technical schools or institutes 27 organized and operated exclusively to provide a course of 28 study of not less than 6 weeks duration and designed to 29 prepare individuals to follow a trade or to pursue a manual, 30 technical, mechanical, industrial, business, or commercial 31 occupation. 32 (28)(27)Beginning January 1, 2000, personal property, 33 including food, purchased through fundraising events for the 34 benefit of a public or private elementary or secondary SB1929 Engrossed -18- LRB9111995SMdv 1 school, a group of those schools, or one or more school 2 districts if the events are sponsored by an entity recognized 3 by the school district that consists primarily of volunteers 4 and includes parents and teachers of the school children. 5 This paragraph does not apply to fundraising events (i) for 6 the benefit of private home instruction or (ii) for which the 7 fundraising entity purchases the personal property sold at 8 the events from another individual or entity that sold the 9 property for the purpose of resale by the fundraising entity 10 and that profits from the sale to the fundraising entity. 11 This paragraph is exempt from the provisions of Section 3-90. 12 (29)(26)Beginning January 1, 2000, new or used 13 automatic vending machines that prepare and serve hot food 14 and beverages, including coffee, soup, and other items, and 15 replacement parts for these machines. This paragraph is 16 exempt from the provisions of Section 3-90. 17 (30) Beginning January 1, 2001, qualified technological 18 equipment purchased for lease by lessors under leases subject 19 to the Qualified Technological Equipment Leasing Occupation 20 and Use Tax Act. However, this exemption will last only as 21 long as the property continues to be leased by the lessor. 22 When the property is no longer used for lease and the 23 property reverts to the lessor, the property is subject to 24 the tax imposed by this Act upon the fair market value of the 25 property on the date of the reversion. The property will not 26 be considered to revert to the lessor as long as the lessor 27 holds the property in his or her lease inventory and does not 28 otherwise use the property, except for demonstration 29 purposes. In addition, property held in the lessor's lease 30 inventory that is subsequently leased for a period of less 31 than one year will not be considered to revert to the lessor 32 if the property is returned to lease inventory at the 33 termination of the lease. This paragraph is exempt from the 34 provisions of Section 3-90. SB1929 Engrossed -19- LRB9111995SMdv 1 (Source: P.A. 90-14, eff. 7-1-97; 90-552, eff. 12-12-97; 2 90-605, eff. 6-30-98; 91-51, eff. 6-30-99; 91-200, eff. 3 7-20-99; 91-439, eff. 8-6-99; 91-637, eff. 8-20-99; 91-644, 4 eff. 8-20-99; revised 9-29-99.) 5 (35 ILCS 105/9) (from Ch. 120, par. 439.9) 6 Sec. 9. Except as to motor vehicles, watercraft, 7 aircraft, and trailers that are required to be registered 8 with an agency of this State, each retailer required or 9 authorized to collect the tax imposed by this Act shall pay 10 to the Department the amount of such tax (except as otherwise 11 provided) at the time when he is required to file his return 12 for the period during which such tax was collected, less a 13 discount of 2.1% prior to January 1, 1990, and 1.75% on and 14 after January 1, 1990, or $5 per calendar year, whichever is 15 greater, which is allowed to reimburse the retailer for 16 expenses incurred in collecting the tax, keeping records, 17 preparing and filing returns, remitting the tax and supplying 18 data to the Department on request. In the case of retailers 19 who report and pay the tax on a transaction by transaction 20 basis, as provided in this Section, such discount shall be 21 taken with each such tax remittance instead of when such 22 retailer files his periodic return. A retailer need not 23 remit that part of any tax collected by him to the extent 24 that he is required to remit and does remit the tax imposed 25 by the Retailers' Occupation Tax Act, with respect to the 26 sale of the same property. 27 Where such tangible personal property is sold under a 28 conditional sales contract, or under any other form of sale 29 wherein the payment of the principal sum, or a part thereof, 30 is extended beyond the close of the period for which the 31 return is filed, the retailer, in collecting the tax (except 32 as to motor vehicles, watercraft, aircraft, and trailers that 33 are required to be registered with an agency of this State), SB1929 Engrossed -20- LRB9111995SMdv 1 may collect for each tax return period, only the tax 2 applicable to that part of the selling price actually 3 received during such tax return period. 4 Except as provided in this Section, on or before the 5 twentieth day of each calendar month, such retailer shall 6 file a return for the preceding calendar month. Such return 7 shall be filed on forms prescribed by the Department and 8 shall furnish such information as the Department may 9 reasonably require. 10 The Department may require returns to be filed on a 11 quarterly basis. If so required, a return for each calendar 12 quarter shall be filed on or before the twentieth day of the 13 calendar month following the end of such calendar quarter. 14 The taxpayer shall also file a return with the Department for 15 each of the first two months of each calendar quarter, on or 16 before the twentieth day of the following calendar month, 17 stating: 18 1. The name of the seller; 19 2. The address of the principal place of business 20 from which he engages in the business of selling tangible 21 personal property at retail in this State; 22 3. The total amount of taxable receipts received by 23 him during the preceding calendar month from sales of 24 tangible personal property by him during such preceding 25 calendar month, including receipts from charge and time 26 sales, but less all deductions allowed by law; 27 4. The amount of credit provided in Section 2d of 28 this Act; 29 5. The amount of tax due; 30 5-5. The signature of the taxpayer; and 31 6. Such other reasonable information as the 32 Department may require. 33 If a taxpayer fails to sign a return within 30 days after 34 the proper notice and demand for signature by the Department, SB1929 Engrossed -21- LRB9111995SMdv 1 the return shall be considered valid and any amount shown to 2 be due on the return shall be deemed assessed. 3 Beginning October 1, 1993, a taxpayer who has an average 4 monthly tax liability of $150,000 or more shall make all 5 payments required by rules of the Department by electronic 6 funds transfer. Beginning October 1, 1994, a taxpayer who has 7 an average monthly tax liability of $100,000 or more shall 8 make all payments required by rules of the Department by 9 electronic funds transfer. Beginning October 1, 1995, a 10 taxpayer who has an average monthly tax liability of $50,000 11 or more shall make all payments required by rules of the 12 Department by electronic funds transfer. Beginning October 1, 13 2000, a taxpayer who has an annual tax liability of $200,000 14 or more shall make all payments required by rules of the 15 Department by electronic funds transfer. The term "annual 16 tax liability" shall be the sum of the taxpayer's liabilities 17 under this Act, and under all other State and local 18 occupation and use tax laws administered by the Department, 19 for the immediately preceding calendar year. The term 20 "average monthly tax liability" means the sum of the 21 taxpayer's liabilities under this Act, and under all other 22 State and local occupation and use tax laws administered by 23 the Department, for the immediately preceding calendar year 24 divided by 12. 25 Before August 1 of each year beginning in 1993, the 26 Department shall notify all taxpayers required to make 27 payments by electronic funds transfer. All taxpayers required 28 to make payments by electronic funds transfer shall make 29 those payments for a minimum of one year beginning on October 30 1. 31 Any taxpayer not required to make payments by electronic 32 funds transfer may make payments by electronic funds transfer 33 with the permission of the Department. 34 All taxpayers required to make payment by electronic SB1929 Engrossed -22- LRB9111995SMdv 1 funds transfer and any taxpayers authorized to voluntarily 2 make payments by electronic funds transfer shall make those 3 payments in the manner authorized by the Department. 4 The Department shall adopt such rules as are necessary to 5 effectuate a program of electronic funds transfer and the 6 requirements of this Section. 7 Before October 1, 2000, if the taxpayer's average monthly 8 tax liability to the Department under this Act, the 9 Retailers' Occupation Tax Act, the Service Occupation Tax 10 Act, the Service Use Tax Act was $10,000 or more during the 11 preceding 4 complete calendar quarters, he shall file a 12 return with the Department each month by the 20th day of the 13 month next following the month during which such tax 14 liability is incurred and shall make payments to the 15 Department on or before the 7th, 15th, 22nd and last day of 16 the month during which such liability is incurred. On and 17 after October 1, 2000, if the taxpayer's average monthly tax 18 liability to the Department under this Act, the Retailers' 19 Occupation Tax Act, the Service Occupation Tax Act, and the 20 Service Use Tax Act was $20,000 or more during the preceding 21 4 complete calendar quarters, he shall file a return with the 22 Department each month by the 20th day of the month next 23 following the month during which such tax liability is 24 incurred and shall make payment to the Department on or 25 before the 7th, 15th, 22nd and last day oforthe month 26 during which such liability is incurred. If the month during 27 which such tax liability is incurred began prior to January 28 1, 1985, each payment shall be in an amount equal to 1/4 of 29 the taxpayer's actual liability for the month or an amount 30 set by the Department not to exceed 1/4 of the average 31 monthly liability of the taxpayer to the Department for the 32 preceding 4 complete calendar quarters (excluding the month 33 of highest liability and the month of lowest liability in 34 such 4 quarter period). If the month during which such tax SB1929 Engrossed -23- LRB9111995SMdv 1 liability is incurred begins on or after January 1, 1985, and 2 prior to January 1, 1987, each payment shall be in an amount 3 equal to 22.5% of the taxpayer's actual liability for the 4 month or 27.5% of the taxpayer's liability for the same 5 calendar month of the preceding year. If the month during 6 which such tax liability is incurred begins on or after 7 January 1, 1987, and prior to January 1, 1988, each payment 8 shall be in an amount equal to 22.5% of the taxpayer's actual 9 liability for the month or 26.25% of the taxpayer's liability 10 for the same calendar month of the preceding year. If the 11 month during which such tax liability is incurred begins on 12 or after January 1, 1988, and prior to January 1, 1989, or 13 begins on or after January 1, 1996, each payment shall be in 14 an amount equal to 22.5% of the taxpayer's actual liability 15 for the month or 25% of the taxpayer's liability for the same 16 calendar month of the preceding year. If the month during 17 which such tax liability is incurred begins on or after 18 January 1, 1989, and prior to January 1, 1996, each payment 19 shall be in an amount equal to 22.5% of the taxpayer's actual 20 liability for the month or 25% of the taxpayer's liability 21 for the same calendar month of the preceding year or 100% of 22 the taxpayer's actual liability for the quarter monthly 23 reporting period. The amount of such quarter monthly 24 payments shall be credited against the final tax liability of 25 the taxpayer's return for that month. Before October 1, 26 2000, once applicable, the requirement of the making of 27 quarter monthly payments to the Department shall continue 28 until such taxpayer's average monthly liability to the 29 Department during the preceding 4 complete calendar quarters 30 (excluding the month of highest liability and the month of 31 lowest liability) is less than $9,000, or until such 32 taxpayer's average monthly liability to the Department as 33 computed for each calendar quarter of the 4 preceding 34 complete calendar quarter period is less than $10,000. SB1929 Engrossed -24- LRB9111995SMdv 1 However, if a taxpayer can show the Department that a 2 substantial change in the taxpayer's business has occurred 3 which causes the taxpayer to anticipate that his average 4 monthly tax liability for the reasonably foreseeable future 5 will fall below the $10,000 threshold stated above, then such 6 taxpayer may petition the Department for change in such 7 taxpayer's reporting status. On and after October 1, 2000, 8 once applicable, the requirement of the making of quarter 9 monthly payments to the Department shall continue until such 10 taxpayer's average monthly liability to the Department during 11 the preceding 4 complete calendar quarters (excluding the 12 month of highest liability and the month of lowest liability) 13 is less than $19,000 or until such taxpayer's average monthly 14 liability to the Department as computed for each calendar 15 quarter of the 4 preceding complete calendar quarter period 16 is less than $20,000. However, if a taxpayer can show the 17 Department that a substantial change in the taxpayer's 18 business has occurred which causes the taxpayer to anticipate 19 that his average monthly tax liability for the reasonably 20 foreseeable future will fall below the $20,000 threshold 21 stated above, then such taxpayer may petition the Department 22 for a change in such taxpayer's reporting status. The 23 Department shall change such taxpayer's reporting status 24 unless it finds that such change is seasonal in nature and 25 not likely to be long term. If any such quarter monthly 26 payment is not paid at the time or in the amount required by 27 this Section, then the taxpayer shall be liable for penalties 28 and interest on the difference between the minimum amount due 29 and the amount of such quarter monthly payment actually and 30 timely paid, except insofar as the taxpayer has previously 31 made payments for that month to the Department in excess of 32 the minimum payments previously due as provided in this 33 Section. The Department shall make reasonable rules and 34 regulations to govern the quarter monthly payment amount and SB1929 Engrossed -25- LRB9111995SMdv 1 quarter monthly payment dates for taxpayers who file on other 2 than a calendar monthly basis. 3 If any such payment provided for in this Section exceeds 4 the taxpayer's liabilities under this Act, the Retailers' 5 Occupation Tax Act, the Service Occupation Tax Act and the 6 Service Use Tax Act, as shown by an original monthly return, 7 the Department shall issue to the taxpayer a credit 8 memorandum no later than 30 days after the date of payment, 9 which memorandum may be submitted by the taxpayer to the 10 Department in payment of tax liability subsequently to be 11 remitted by the taxpayer to the Department or be assigned by 12 the taxpayer to a similar taxpayer under this Act, the 13 Retailers' Occupation Tax Act, the Service Occupation Tax Act 14 or the Service Use Tax Act, in accordance with reasonable 15 rules and regulations to be prescribed by the Department, 16 except that if such excess payment is shown on an original 17 monthly return and is made after December 31, 1986, no credit 18 memorandum shall be issued, unless requested by the taxpayer. 19 If no such request is made, the taxpayer may credit such 20 excess payment against tax liability subsequently to be 21 remitted by the taxpayer to the Department under this Act, 22 the Retailers' Occupation Tax Act, the Service Occupation Tax 23 Act or the Service Use Tax Act, in accordance with reasonable 24 rules and regulations prescribed by the Department. If the 25 Department subsequently determines that all or any part of 26 the credit taken was not actually due to the taxpayer, the 27 taxpayer's 2.1% or 1.75% vendor's discount shall be reduced 28 by 2.1% or 1.75% of the difference between the credit taken 29 and that actually due, and the taxpayer shall be liable for 30 penalties and interest on such difference. 31 If the retailer is otherwise required to file a monthly 32 return and if the retailer's average monthly tax liability to 33 the Department does not exceed $200, the Department may 34 authorize his returns to be filed on a quarter annual basis, SB1929 Engrossed -26- LRB9111995SMdv 1 with the return for January, February, and March of a given 2 year being due by April 20 of such year; with the return for 3 April, May and June of a given year being due by July 20 of 4 such year; with the return for July, August and September of 5 a given year being due by October 20 of such year, and with 6 the return for October, November and December of a given year 7 being due by January 20 of the following year. 8 If the retailer is otherwise required to file a monthly 9 or quarterly return and if the retailer's average monthly tax 10 liability to the Department does not exceed $50, the 11 Department may authorize his returns to be filed on an annual 12 basis, with the return for a given year being due by January 13 20 of the following year. 14 Such quarter annual and annual returns, as to form and 15 substance, shall be subject to the same requirements as 16 monthly returns. 17 Notwithstanding any other provision in this Act 18 concerning the time within which a retailer may file his 19 return, in the case of any retailer who ceases to engage in a 20 kind of business which makes him responsible for filing 21 returns under this Act, such retailer shall file a final 22 return under this Act with the Department not more than one 23 month after discontinuing such business. 24 In addition, with respect to motor vehicles, watercraft, 25 aircraft, and trailers that are required to be registered 26 with an agency of this State, every retailer selling this 27 kind of tangible personal property shall file, with the 28 Department, upon a form to be prescribed and supplied by the 29 Department, a separate return for each such item of tangible 30 personal property which the retailer sells, except that 31 where, in the same transaction, a retailer of aircraft, 32 watercraft, motor vehicles or trailers transfers more than 33 one aircraft, watercraft, motor vehicle or trailer to another 34 aircraft, watercraft, motor vehicle or trailer retailer for SB1929 Engrossed -27- LRB9111995SMdv 1 the purpose of resale, that seller for resale may report the 2 transfer of all the aircraft, watercraft, motor vehicles or 3 trailers involved in that transaction to the Department on 4 the same uniform invoice-transaction reporting return form. 5 For purposes of this Section, "watercraft" means a Class 2, 6 Class 3, or Class 4 watercraft as defined in Section 3-2 of 7 the Boat Registration and Safety Act, a personal watercraft, 8 or any boat equipped with an inboard motor. 9 The transaction reporting return in the case of motor 10 vehicles or trailers that are required to be registered with 11 an agency of this State, shall be the same document as the 12 Uniform Invoice referred to in Section 5-402 of the Illinois 13 Vehicle Code and must show the name and address of the 14 seller; the name and address of the purchaser; the amount of 15 the selling price including the amount allowed by the 16 retailer for traded-in property, if any; the amount allowed 17 by the retailer for the traded-in tangible personal property, 18 if any, to the extent to which Section 2 of this Act allows 19 an exemption for the value of traded-in property; the balance 20 payable after deducting such trade-in allowance from the 21 total selling price; the amount of tax due from the retailer 22 with respect to such transaction; the amount of tax collected 23 from the purchaser by the retailer on such transaction (or 24 satisfactory evidence that such tax is not due in that 25 particular instance, if that is claimed to be the fact); the 26 place and date of the sale; a sufficient identification of 27 the property sold; such other information as is required in 28 Section 5-402 of the Illinois Vehicle Code, and such other 29 information as the Department may reasonably require. 30 The transaction reporting return in the case of 31 watercraft and aircraft must show the name and address of the 32 seller; the name and address of the purchaser; the amount of 33 the selling price including the amount allowed by the 34 retailer for traded-in property, if any; the amount allowed SB1929 Engrossed -28- LRB9111995SMdv 1 by the retailer for the traded-in tangible personal property, 2 if any, to the extent to which Section 2 of this Act allows 3 an exemption for the value of traded-in property; the balance 4 payable after deducting such trade-in allowance from the 5 total selling price; the amount of tax due from the retailer 6 with respect to such transaction; the amount of tax collected 7 from the purchaser by the retailer on such transaction (or 8 satisfactory evidence that such tax is not due in that 9 particular instance, if that is claimed to be the fact); the 10 place and date of the sale, a sufficient identification of 11 the property sold, and such other information as the 12 Department may reasonably require. 13 Such transaction reporting return shall be filed not 14 later than 20 days after the date of delivery of the item 15 that is being sold, but may be filed by the retailer at any 16 time sooner than that if he chooses to do so. The 17 transaction reporting return and tax remittance or proof of 18 exemption from the tax that is imposed by this Act may be 19 transmitted to the Department by way of the State agency with 20 which, or State officer with whom, the tangible personal 21 property must be titled or registered (if titling or 22 registration is required) if the Department and such agency 23 or State officer determine that this procedure will expedite 24 the processing of applications for title or registration. 25 With each such transaction reporting return, the retailer 26 shall remit the proper amount of tax due (or shall submit 27 satisfactory evidence that the sale is not taxable if that is 28 the case), to the Department or its agents, whereupon the 29 Department shall issue, in the purchaser's name, a tax 30 receipt (or a certificate of exemption if the Department is 31 satisfied that the particular sale is tax exempt) which such 32 purchaser may submit to the agency with which, or State 33 officer with whom, he must title or register the tangible 34 personal property that is involved (if titling or SB1929 Engrossed -29- LRB9111995SMdv 1 registration is required) in support of such purchaser's 2 application for an Illinois certificate or other evidence of 3 title or registration to such tangible personal property. 4 No retailer's failure or refusal to remit tax under this 5 Act precludes a user, who has paid the proper tax to the 6 retailer, from obtaining his certificate of title or other 7 evidence of title or registration (if titling or registration 8 is required) upon satisfying the Department that such user 9 has paid the proper tax (if tax is due) to the retailer. The 10 Department shall adopt appropriate rules to carry out the 11 mandate of this paragraph. 12 If the user who would otherwise pay tax to the retailer 13 wants the transaction reporting return filed and the payment 14 of tax or proof of exemption made to the Department before 15 the retailer is willing to take these actions and such user 16 has not paid the tax to the retailer, such user may certify 17 to the fact of such delay by the retailer, and may (upon the 18 Department being satisfied of the truth of such 19 certification) transmit the information required by the 20 transaction reporting return and the remittance for tax or 21 proof of exemption directly to the Department and obtain his 22 tax receipt or exemption determination, in which event the 23 transaction reporting return and tax remittance (if a tax 24 payment was required) shall be credited by the Department to 25 the proper retailer's account with the Department, but 26 without the 2.1% or 1.75% discount provided for in this 27 Section being allowed. When the user pays the tax directly 28 to the Department, he shall pay the tax in the same amount 29 and in the same form in which it would be remitted if the tax 30 had been remitted to the Department by the retailer. 31 Where a retailer collects the tax with respect to the 32 selling price of tangible personal property which he sells 33 and the purchaser thereafter returns such tangible personal 34 property and the retailer refunds the selling price thereof SB1929 Engrossed -30- LRB9111995SMdv 1 to the purchaser, such retailer shall also refund, to the 2 purchaser, the tax so collected from the purchaser. When 3 filing his return for the period in which he refunds such tax 4 to the purchaser, the retailer may deduct the amount of the 5 tax so refunded by him to the purchaser from any other use 6 tax which such retailer may be required to pay or remit to 7 the Department, as shown by such return, if the amount of the 8 tax to be deducted was previously remitted to the Department 9 by such retailer. If the retailer has not previously 10 remitted the amount of such tax to the Department, he is 11 entitled to no deduction under this Act upon refunding such 12 tax to the purchaser. 13 Any retailer filing a return under this Section shall 14 also include (for the purpose of paying tax thereon) the 15 total tax covered by such return upon the selling price of 16 tangible personal property purchased by him at retail from a 17 retailer, but as to which the tax imposed by this Act was not 18 collected from the retailer filing such return, and such 19 retailer shall remit the amount of such tax to the Department 20 when filing such return. 21 If experience indicates such action to be practicable, 22 the Department may prescribe and furnish a combination or 23 joint return which will enable retailers, who are required to 24 file returns hereunder and also under the Retailers' 25 Occupation Tax Act, to furnish all the return information 26 required by both Acts on the one form. 27 Where the retailer has more than one business registered 28 with the Department under separate registration under this 29 Act, such retailer may not file each return that is due as a 30 single return covering all such registered businesses, but 31 shall file separate returns for each such registered 32 business. 33 Beginning January 1, 1990, each month the Department 34 shall pay into the State and Local Sales Tax Reform Fund, a SB1929 Engrossed -31- LRB9111995SMdv 1 special fund in the State Treasury which is hereby created, 2 the net revenue realized for the preceding month from the 1% 3 tax on sales of food for human consumption which is to be 4 consumed off the premises where it is sold (other than 5 alcoholic beverages, soft drinks and food which has been 6 prepared for immediate consumption) and prescription and 7 nonprescription medicines, drugs, medical appliances and 8 insulin, urine testing materials, syringes and needles used 9 by diabetics. 10 Beginning January 1, 1990, each month the Department 11 shall pay into the County and Mass Transit District Fund 4% 12 of the net revenue realized for the preceding month from the 13 6.25% general rate on the selling price of tangible personal 14 property which is purchased outside Illinois at retail from a 15 retailer and which is titled or registered by an agency of 16 this State's government. 17 Beginning January 1, 1990, each month the Department 18 shall pay into the State and Local Sales Tax Reform Fund, a 19 special fund in the State Treasury, 20% of the net revenue 20 realized for the preceding month from the 6.25% general rate 21 on the selling price of tangible personal property, other 22 than tangible personal property which is purchased outside 23 Illinois at retail from a retailer and which is titled or 24 registered by an agency of this State's government. 25 Beginning January 1, 1990, each month the Department 26 shall pay into the Local Government Tax Fund 16% of the net 27 revenue realized for the preceding month from the 6.25% 28 general rate on the selling price of tangible personal 29 property which is purchased outside Illinois at retail from a 30 retailer and which is titled or registered by an agency of 31 this State's government. 32 Of the remainder of the moneys received by the Department 33 pursuant to this Act, (a) 1.75% thereof shall be paid into 34 the Build Illinois Fund and (b) prior to July 1, 1989, 2.2% SB1929 Engrossed -32- LRB9111995SMdv 1 and on and after July 1, 1989, 3.8% thereof shall be paid 2 into the Build Illinois Fund; provided, however, that if in 3 any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%, 4 as the case may be, of the moneys received by the Department 5 and required to be paid into the Build Illinois Fund pursuant 6 to Section 3 of the Retailers' Occupation Tax Act, Section 9 7 of the Use Tax Act, Section 9 of the Service Use Tax Act, and 8 Section 9 of the Service Occupation Tax Act, such Acts being 9 hereinafter called the "Tax Acts" and such aggregate of 2.2% 10 or 3.8%, as the case may be, of moneys being hereinafter 11 called the "Tax Act Amount", and (2) the amount transferred 12 to the Build Illinois Fund from the State and Local Sales Tax 13 Reform Fund shall be less than the Annual Specified Amount 14 (as defined in Section 3 of the Retailers' Occupation Tax 15 Act), an amount equal to the difference shall be immediately 16 paid into the Build Illinois Fund from other moneys received 17 by the Department pursuant to the Tax Acts; and further 18 provided, that if on the last business day of any month the 19 sum of (1) the Tax Act Amount required to be deposited into 20 the Build Illinois Bond Account in the Build Illinois Fund 21 during such month and (2) the amount transferred during such 22 month to the Build Illinois Fund from the State and Local 23 Sales Tax Reform Fund shall have been less than 1/12 of the 24 Annual Specified Amount, an amount equal to the difference 25 shall be immediately paid into the Build Illinois Fund from 26 other moneys received by the Department pursuant to the Tax 27 Acts; and, further provided, that in no event shall the 28 payments required under the preceding proviso result in 29 aggregate payments into the Build Illinois Fund pursuant to 30 this clause (b) for any fiscal year in excess of the greater 31 of (i) the Tax Act Amount or (ii) the Annual Specified Amount 32 for such fiscal year; and, further provided, that the amounts 33 payable into the Build Illinois Fund under this clause (b) 34 shall be payable only until such time as the aggregate amount SB1929 Engrossed -33- LRB9111995SMdv 1 on deposit under each trust indenture securing Bonds issued 2 and outstanding pursuant to the Build Illinois Bond Act is 3 sufficient, taking into account any future investment income, 4 to fully provide, in accordance with such indenture, for the 5 defeasance of or the payment of the principal of, premium, if 6 any, and interest on the Bonds secured by such indenture and 7 on any Bonds expected to be issued thereafter and all fees 8 and costs payable with respect thereto, all as certified by 9 the Director of the Bureau of the Budget. If on the last 10 business day of any month in which Bonds are outstanding 11 pursuant to the Build Illinois Bond Act, the aggregate of the 12 moneys deposited in the Build Illinois Bond Account in the 13 Build Illinois Fund in such month shall be less than the 14 amount required to be transferred in such month from the 15 Build Illinois Bond Account to the Build Illinois Bond 16 Retirement and Interest Fund pursuant to Section 13 of the 17 Build Illinois Bond Act, an amount equal to such deficiency 18 shall be immediately paid from other moneys received by the 19 Department pursuant to the Tax Acts to the Build Illinois 20 Fund; provided, however, that any amounts paid to the Build 21 Illinois Fund in any fiscal year pursuant to this sentence 22 shall be deemed to constitute payments pursuant to clause (b) 23 of the preceding sentence and shall reduce the amount 24 otherwise payable for such fiscal year pursuant to clause (b) 25 of the preceding sentence. The moneys received by the 26 Department pursuant to this Act and required to be deposited 27 into the Build Illinois Fund are subject to the pledge, claim 28 and charge set forth in Section 12 of the Build Illinois Bond 29 Act. 30 Subject to payment of amounts into the Build Illinois 31 Fund as provided in the preceding paragraph or in any 32 amendment thereto hereafter enacted, the following specified 33 monthly installment of the amount requested in the 34 certificate of the Chairman of the Metropolitan Pier and SB1929 Engrossed -34- LRB9111995SMdv 1 Exposition Authority provided under Section 8.25f of the 2 State Finance Act, but not in excess of the sums designated 3 as "Total Deposit", shall be deposited in the aggregate from 4 collections under Section 9 of the Use Tax Act, Section 9 of 5 the Service Use Tax Act, Section 9 of the Service Occupation 6 Tax Act, and Section 3 of the Retailers' Occupation Tax Act 7 into the McCormick Place Expansion Project Fund in the 8 specified fiscal years. 9 Fiscal Year Total Deposit 10 1993 $0 11 1994 53,000,000 12 1995 58,000,000 13 1996 61,000,000 14 1997 64,000,000 15 1998 68,000,000 16 1999 71,000,000 17 2000 75,000,000 18 2001 80,000,000 19 2002 84,000,000 20 2003 89,000,000 21 2004 93,000,000 22 2005 97,000,000 23 2006 102,000,000 24 2007 108,000,000 25 2008 115,000,000 26 2009 120,000,000 27 2010 126,000,000 28 2011 132,000,000 29 2012 138,000,000 30 2013 and 145,000,000 31 each fiscal year 32 thereafter that bonds 33 are outstanding under 34 Section 13.2 of the SB1929 Engrossed -35- LRB9111995SMdv 1 Metropolitan Pier and 2 Exposition Authority 3 Act, but not after fiscal year 2029. 4 Beginning July 20, 1993 and in each month of each fiscal 5 year thereafter, one-eighth of the amount requested in the 6 certificate of the Chairman of the Metropolitan Pier and 7 Exposition Authority for that fiscal year, less the amount 8 deposited into the McCormick Place Expansion Project Fund by 9 the State Treasurer in the respective month under subsection 10 (g) of Section 13 of the Metropolitan Pier and Exposition 11 Authority Act, plus cumulative deficiencies in the deposits 12 required under this Section for previous months and years, 13 shall be deposited into the McCormick Place Expansion Project 14 Fund, until the full amount requested for the fiscal year, 15 but not in excess of the amount specified above as "Total 16 Deposit", has been deposited. 17 Subject to payment of amounts into the Build Illinois 18 Fund and the McCormick Place Expansion Project Fund pursuant 19 to the preceding paragraphs or in any amendment thereto 20 hereafter enacted, each month the Department shall pay into 21 the Local Government Distributive Fund .4% of the net revenue 22 realized for the preceding month from the 5% general rate, or 23 .4% of 80% of the net revenue realized for the preceding 24 month from the 6.25% general rate, as the case may be, on the 25 selling price of tangible personal property which amount 26 shall, subject to appropriation, be distributed as provided 27 in Section 2 of the State Revenue Sharing Act. No payments or 28 distributions pursuant to this paragraph shall be made if the 29 tax imposed by this Act on photoprocessing products is 30 declared unconstitutional, or if the proceeds from such tax 31 are unavailable for distribution because of litigation. 32 Subject to payment of amounts into the Build Illinois 33 Fund, the McCormick Place Expansion Project Fund, and the 34 Local Government Distributive Fund pursuant to the preceding SB1929 Engrossed -36- LRB9111995SMdv 1 paragraphs or in any amendments thereto hereafter enacted, 2 beginning July 1, 1993, the Department shall each month pay 3 into the Illinois Tax Increment Fund 0.27% of 80% of the net 4 revenue realized for the preceding month from the 6.25% 5 general rate on the selling price of tangible personal 6 property. 7 Of the remainder of the moneys received by the Department 8 pursuant to this Act and the moneys received by the 9 Department from the 80% of the 6.25% rate of use tax imposed 10 in Section 20 of the Qualified Technological Equipment 11 Leasing Occupation and Use Tax Act, 75% thereof shall be paid 12 into the State Treasury and 25% shall be reserved in a 13 special account and used only for the transfer to the Common 14 School Fund as part of the monthly transfer from the General 15 Revenue Fund in accordance with Section 8a of the State 16 Finance Act. 17 As soon as possible after the first day of each month, 18 upon certification of the Department of Revenue, the 19 Comptroller shall order transferred and the Treasurer shall 20 transfer from the General Revenue Fund to the Motor Fuel Tax 21 Fund an amount equal to 1.7% of 80% of the net revenue 22 realized under this Act for the second preceding month. 23 Beginning April 1, 2000, this transfer is no longer required 24 and shall not be made. 25 Net revenue realized for a month shall be the revenue 26 collected by the State pursuant to this Act, less the amount 27 paid out during that month as refunds to taxpayers for 28 overpayment of liability. 29 For greater simplicity of administration, manufacturers, 30 importers and wholesalers whose products are sold at retail 31 in Illinois by numerous retailers, and who wish to do so, may 32 assume the responsibility for accounting and paying to the 33 Department all tax accruing under this Act with respect to 34 such sales, if the retailers who are affected do not make SB1929 Engrossed -37- LRB9111995SMdv 1 written objection to the Department to this arrangement. 2 (Source: P.A. 90-491, eff. 1-1-99; 90-612, eff. 7-8-98; 3 91-37, eff. 7-1-99; 91-51, eff. 6-30-99; 91-101, eff. 4 7-12-99; 91-541, eff. 8-13-99; revised 9-29-99.) 5 (35 ILCS 105/9.5 new) 6 Sec. 9.5. Refund; leaseback transaction. A purchaser of 7 qualified technological equipment, as defined in Section 5 of 8 the Qualified Technological Equipment Leasing Occupation and 9 Use Tax Act, may obtain a refund of all tax paid to a seller 10 under this Act or any other tax administered by the 11 Department if the purchaser sells the property to a rentor 12 under a bona fide sale and leaseback transaction (to such 13 purchaser) within 90 days of the first functional use of the 14 property. The purchaser shall request the refund from the 15 seller to whom he or she has paid the tax in the same manner 16 and subject to the same requirements as other refunds 17 provided in Section 9 of this Act. For purposes of this 18 Section, the first functional use of property shall be the 19 use for which the property is intended, which shall, in the 20 absence of other evidence, be presumed to be the date of 21 delivery of the property. 22 Section 115. The Service Use Tax Act is amended by 23 changing Section 3-5 as follows: 24 (35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5) 25 Sec. 3-5. Exemptions. Use of the following tangible 26 personal property is exempt from the tax imposed by this Act: 27 (1) Personal property purchased from a corporation, 28 society, association, foundation, institution, or 29 organization, other than a limited liability company, that is 30 organized and operated as a not-for-profit service enterprise 31 for the benefit of persons 65 years of age or older if the SB1929 Engrossed -38- LRB9111995SMdv 1 personal property was not purchased by the enterprise for the 2 purpose of resale by the enterprise. 3 (2) Personal property purchased by a non-profit Illinois 4 county fair association for use in conducting, operating, or 5 promoting the county fair. 6 (3) Personal property purchased by a not-for-profit arts 7 or cultural organization that establishes, by proof required 8 by the Department by rule, that it has received an exemption 9 under Section 501(c)(3) of the Internal Revenue Code and that 10 is organized and operated for the presentation or support of 11 arts or cultural programming, activities, or services. These 12 organizations include, but are not limited to, music and 13 dramatic arts organizations such as symphony orchestras and 14 theatrical groups, arts and cultural service organizations, 15 local arts councils, visual arts organizations, and media 16 arts organizations. 17 (4) Legal tender, currency, medallions, or gold or 18 silver coinage issued by the State of Illinois, the 19 government of the United States of America, or the government 20 of any foreign country, and bullion. 21 (5) Graphic arts machinery and equipment, including 22 repair and replacement parts, both new and used, and 23 including that manufactured on special order or purchased for 24 lease, certified by the purchaser to be used primarily for 25 graphic arts production. 26 (6) Personal property purchased from a teacher-sponsored 27 student organization affiliated with an elementary or 28 secondary school located in Illinois. 29 (7) Farm machinery and equipment, both new and used, 30 including that manufactured on special order, certified by 31 the purchaser to be used primarily for production agriculture 32 or State or federal agricultural programs, including 33 individual replacement parts for the machinery and equipment, 34 including machinery and equipment purchased for lease, and SB1929 Engrossed -39- LRB9111995SMdv 1 including implements of husbandry defined in Section 1-130 of 2 the Illinois Vehicle Code, farm machinery and agricultural 3 chemical and fertilizer spreaders, and nurse wagons required 4 to be registered under Section 3-809 of the Illinois Vehicle 5 Code, but excluding other motor vehicles required to be 6 registered under the Illinois Vehicle Code. Horticultural 7 polyhouses or hoop houses used for propagating, growing, or 8 overwintering plants shall be considered farm machinery and 9 equipment under this item (7). Agricultural chemical tender 10 tanks and dry boxes shall include units sold separately from 11 a motor vehicle required to be licensed and units sold 12 mounted on a motor vehicle required to be licensed if the 13 selling price of the tender is separately stated. 14 Farm machinery and equipment shall include precision 15 farming equipment that is installed or purchased to be 16 installed on farm machinery and equipment including, but not 17 limited to, tractors, harvesters, sprayers, planters, 18 seeders, or spreaders. Precision farming equipment includes, 19 but is not limited to, soil testing sensors, computers, 20 monitors, software, global positioning and mapping systems, 21 and other such equipment. 22 Farm machinery and equipment also includes computers, 23 sensors, software, and related equipment used primarily in 24 the computer-assisted operation of production agriculture 25 facilities, equipment, and activities such as, but not 26 limited to, the collection, monitoring, and correlation of 27 animal and crop data for the purpose of formulating animal 28 diets and agricultural chemicals. This item (7) is exempt 29 from the provisions of Section 3-75. 30 (8) Fuel and petroleum products sold to or used by an 31 air common carrier, certified by the carrier to be used for 32 consumption, shipment, or storage in the conduct of its 33 business as an air common carrier, for a flight destined for 34 or returning from a location or locations outside the United SB1929 Engrossed -40- LRB9111995SMdv 1 States without regard to previous or subsequent domestic 2 stopovers. 3 (9) Proceeds of mandatory service charges separately 4 stated on customers' bills for the purchase and consumption 5 of food and beverages acquired as an incident to the purchase 6 of a service from a serviceman, to the extent that the 7 proceeds of the service charge are in fact turned over as 8 tips or as a substitute for tips to the employees who 9 participate directly in preparing, serving, hosting or 10 cleaning up the food or beverage function with respect to 11 which the service charge is imposed. 12 (10) Oil field exploration, drilling, and production 13 equipment, including (i) rigs and parts of rigs, rotary rigs, 14 cable tool rigs, and workover rigs, (ii) pipe and tubular 15 goods, including casing and drill strings, (iii) pumps and 16 pump-jack units, (iv) storage tanks and flow lines, (v) any 17 individual replacement part for oil field exploration, 18 drilling, and production equipment, and (vi) machinery and 19 equipment purchased for lease; but excluding motor vehicles 20 required to be registered under the Illinois Vehicle Code. 21 (11) Proceeds from the sale of photoprocessing machinery 22 and equipment, including repair and replacement parts, both 23 new and used, including that manufactured on special order, 24 certified by the purchaser to be used primarily for 25 photoprocessing, and including photoprocessing machinery and 26 equipment purchased for lease. 27 (12) Coal exploration, mining, offhighway hauling, 28 processing, maintenance, and reclamation equipment, including 29 replacement parts and equipment, and including equipment 30 purchased for lease, but excluding motor vehicles required to 31 be registered under the Illinois Vehicle Code. 32 (13) Semen used for artificial insemination of livestock 33 for direct agricultural production. 34 (14) Horses, or interests in horses, registered with and SB1929 Engrossed -41- LRB9111995SMdv 1 meeting the requirements of any of the Arabian Horse Club 2 Registry of America, Appaloosa Horse Club, American Quarter 3 Horse Association, United States Trotting Association, or 4 Jockey Club, as appropriate, used for purposes of breeding or 5 racing for prizes. 6 (15) Computers and communications equipment utilized for 7 any hospital purpose and equipment used in the diagnosis, 8 analysis, or treatment of hospital patients purchased by a 9 lessor who leases the equipment, under a lease of one year or 10 longer executed or in effect at the time the lessor would 11 otherwise be subject to the tax imposed by this Act, to a 12 hospital that has been issued an active tax exemption 13 identification number by the Department under Section 1g of 14 the Retailers' Occupation Tax Act. If the equipment is leased 15 in a manner that does not qualify for this exemption or is 16 used in any other non-exempt manner, the lessor shall be 17 liable for the tax imposed under this Act or the Use Tax Act, 18 as the case may be, based on the fair market value of the 19 property at the time the non-qualifying use occurs. No 20 lessor shall collect or attempt to collect an amount (however 21 designated) that purports to reimburse that lessor for the 22 tax imposed by this Act or the Use Tax Act, as the case may 23 be, if the tax has not been paid by the lessor. If a lessor 24 improperly collects any such amount from the lessee, the 25 lessee shall have a legal right to claim a refund of that 26 amount from the lessor. If, however, that amount is not 27 refunded to the lessee for any reason, the lessor is liable 28 to pay that amount to the Department. This paragraph is 29 exempt from the provisions of Section 3-75. 30 (16) Personal property purchased by a lessor who leases 31 the property, under a lease of one year or longer executed or 32 in effect at the time the lessor would otherwise be subject 33 to the tax imposed by this Act, to a governmental body that 34 has been issued an active tax exemption identification number SB1929 Engrossed -42- LRB9111995SMdv 1 by the Department under Section 1g of the Retailers' 2 Occupation Tax Act. If the property is leased in a manner 3 that does not qualify for this exemption or is used in any 4 other non-exempt manner, the lessor shall be liable for the 5 tax imposed under this Act or the Use Tax Act, as the case 6 may be, based on the fair market value of the property at the 7 time the non-qualifying use occurs. No lessor shall collect 8 or attempt to collect an amount (however designated) that 9 purports to reimburse that lessor for the tax imposed by this 10 Act or the Use Tax Act, as the case may be, if the tax has 11 not been paid by the lessor. If a lessor improperly collects 12 any such amount from the lessee, the lessee shall have a 13 legal right to claim a refund of that amount from the lessor. 14 If, however, that amount is not refunded to the lessee for 15 any reason, the lessor is liable to pay that amount to the 16 Department. This paragraph is exempt from the provisions of 17 Section 3-75. 18 (17) Beginning with taxable years ending on or after 19 December 31, 1995 and ending with taxable years ending on or 20 before December 31, 2004, personal property that is donated 21 for disaster relief to be used in a State or federally 22 declared disaster area in Illinois or bordering Illinois by a 23 manufacturer or retailer that is registered in this State to 24 a corporation, society, association, foundation, or 25 institution that has been issued a sales tax exemption 26 identification number by the Department that assists victims 27 of the disaster who reside within the declared disaster area. 28 (18) Beginning with taxable years ending on or after 29 December 31, 1995 and ending with taxable years ending on or 30 before December 31, 2004, personal property that is used in 31 the performance of infrastructure repairs in this State, 32 including but not limited to municipal roads and streets, 33 access roads, bridges, sidewalks, waste disposal systems, 34 water and sewer line extensions, water distribution and SB1929 Engrossed -43- LRB9111995SMdv 1 purification facilities, storm water drainage and retention 2 facilities, and sewage treatment facilities, resulting from a 3 State or federally declared disaster in Illinois or bordering 4 Illinois when such repairs are initiated on facilities 5 located in the declared disaster area within 6 months after 6 the disaster. 7 (19) Beginning July 1, 1999, game or game birds 8 purchased at a "game breeding and hunting preserve area" or 9 an "exotic game hunting area" as those terms are used in the 10 Wildlife Code or at a hunting enclosure approved through 11 rules adopted by the Department of Natural Resources. This 12 paragraph is exempt from the provisions of Section 3-75. 13 (20)(19)A motor vehicle, as that term is defined in 14 Section 1-146 of the Illinois Vehicle Code, that is donated 15 to a corporation, limited liability company, society, 16 association, foundation, or institution that is determined by 17 the Department to be organized and operated exclusively for 18 educational purposes. For purposes of this exemption, "a 19 corporation, limited liability company, society, association, 20 foundation, or institution organized and operated exclusively 21 for educational purposes" means all tax-supported public 22 schools, private schools that offer systematic instruction in 23 useful branches of learning by methods common to public 24 schools and that compare favorably in their scope and 25 intensity with the course of study presented in tax-supported 26 schools, and vocational or technical schools or institutes 27 organized and operated exclusively to provide a course of 28 study of not less than 6 weeks duration and designed to 29 prepare individuals to follow a trade or to pursue a manual, 30 technical, mechanical, industrial, business, or commercial 31 occupation. 32 (21)(20)Beginning January 1, 2000, personal property, 33 including food, purchased through fundraising events for the 34 benefit of a public or private elementary or secondary SB1929 Engrossed -44- LRB9111995SMdv 1 school, a group of those schools, or one or more school 2 districts if the events are sponsored by an entity recognized 3 by the school district that consists primarily of volunteers 4 and includes parents and teachers of the school children. 5 This paragraph does not apply to fundraising events (i) for 6 the benefit of private home instruction or (ii) for which the 7 fundraising entity purchases the personal property sold at 8 the events from another individual or entity that sold the 9 property for the purpose of resale by the fundraising entity 10 and that profits from the sale to the fundraising entity. 11 This paragraph is exempt from the provisions of Section 3-75. 12 (22)(19)Beginning January 1, 2000, new or used 13 automatic vending machines that prepare and serve hot food 14 and beverages, including coffee, soup, and other items, and 15 replacement parts for these machines. This paragraph is 16 exempt from the provisions of Section 3-75. 17 (23) Beginning January 1, 2001, qualified technological 18 equipment purchased for lease by lessors under leases subject 19 to the Qualified Technological Equipment Leasing Occupation 20 and Use Tax Act. However, this exemption will last only as 21 long as the property continues to be leased by the lessor. 22 When the property is no longer used for lease and the 23 property reverts to the lessor, the property is subject to 24 the tax imposed by this Act upon the fair market value of the 25 property on the date of the reversion. The property will not 26 be considered to revert to the lessor as long as the lessor 27 holds the property in his or her lease inventory and does not 28 otherwise use the property, except for demonstration 29 purposes. In addition, property held in the lessor's lease 30 inventory that is subsequently leased for a period of less 31 than one year will not be considered to revert to the lessor 32 if the property is returned to lease inventory at the 33 termination of the lease. This paragraph is exempt from the 34 provisions of Section 3-75. SB1929 Engrossed -45- LRB9111995SMdv 1 (Source: P.A. 90-14, eff. 7-1-97; 90-552, eff. 12-12-97; 2 90-605, eff. 6-30-98; 91-51, eff. 6-30-99; 91-200, eff. 3 7-20-99; 91-439, eff. 8-6-99; 91-637, eff. 8-20-99; 91-644, 4 eff. 8-20-99; revised 9-29-99.) 5 Section 120. The Service Occupation Tax Act is amended 6 by changing Section 3-5 as follows: 7 (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5) 8 Sec. 3-5. Exemptions. The following tangible personal 9 property is exempt from the tax imposed by this Act: 10 (1) Personal property sold by a corporation, society, 11 association, foundation, institution, or organization, other 12 than a limited liability company, that is organized and 13 operated as a not-for-profit service enterprise for the 14 benefit of persons 65 years of age or older if the personal 15 property was not purchased by the enterprise for the purpose 16 of resale by the enterprise. 17 (2) Personal property purchased by a not-for-profit 18 Illinois county fair association for use in conducting, 19 operating, or promoting the county fair. 20 (3) Personal property purchased by any not-for-profit 21 arts or cultural organization that establishes, by proof 22 required by the Department by rule, that it has received an 23 exemption under Section 501(c)(3) of the Internal Revenue 24 Code and that is organized and operated for the presentation 25 or support of arts or cultural programming, activities, or 26 services. These organizations include, but are not limited 27 to, music and dramatic arts organizations such as symphony 28 orchestras and theatrical groups, arts and cultural service 29 organizations, local arts councils, visual arts 30 organizations, and media arts organizations. 31 (4) Legal tender, currency, medallions, or gold or 32 silver coinage issued by the State of Illinois, the SB1929 Engrossed -46- LRB9111995SMdv 1 government of the United States of America, or the government 2 of any foreign country, and bullion. 3 (5) Graphic arts machinery and equipment, including 4 repair and replacement parts, both new and used, and 5 including that manufactured on special order or purchased for 6 lease, certified by the purchaser to be used primarily for 7 graphic arts production. 8 (6) Personal property sold by a teacher-sponsored 9 student organization affiliated with an elementary or 10 secondary school located in Illinois. 11 (7) Farm machinery and equipment, both new and used, 12 including that manufactured on special order, certified by 13 the purchaser to be used primarily for production agriculture 14 or State or federal agricultural programs, including 15 individual replacement parts for the machinery and equipment, 16 including machinery and equipment purchased for lease, and 17 including implements of husbandry defined in Section 1-130 of 18 the Illinois Vehicle Code, farm machinery and agricultural 19 chemical and fertilizer spreaders, and nurse wagons required 20 to be registered under Section 3-809 of the Illinois Vehicle 21 Code, but excluding other motor vehicles required to be 22 registered under the Illinois Vehicle Code. Horticultural 23 polyhouses or hoop houses used for propagating, growing, or 24 overwintering plants shall be considered farm machinery and 25 equipment under this item (7). Agricultural chemical tender 26 tanks and dry boxes shall include units sold separately from 27 a motor vehicle required to be licensed and units sold 28 mounted on a motor vehicle required to be licensed if the 29 selling price of the tender is separately stated. 30 Farm machinery and equipment shall include precision 31 farming equipment that is installed or purchased to be 32 installed on farm machinery and equipment including, but not 33 limited to, tractors, harvesters, sprayers, planters, 34 seeders, or spreaders. Precision farming equipment includes, SB1929 Engrossed -47- LRB9111995SMdv 1 but is not limited to, soil testing sensors, computers, 2 monitors, software, global positioning and mapping systems, 3 and other such equipment. 4 Farm machinery and equipment also includes computers, 5 sensors, software, and related equipment used primarily in 6 the computer-assisted operation of production agriculture 7 facilities, equipment, and activities such as, but not 8 limited to, the collection, monitoring, and correlation of 9 animal and crop data for the purpose of formulating animal 10 diets and agricultural chemicals. This item (7) is exempt 11 from the provisions of Section 3-55. 12 (8) Fuel and petroleum products sold to or used by an 13 air common carrier, certified by the carrier to be used for 14 consumption, shipment, or storage in the conduct of its 15 business as an air common carrier, for a flight destined for 16 or returning from a location or locations outside the United 17 States without regard to previous or subsequent domestic 18 stopovers. 19 (9) Proceeds of mandatory service charges separately 20 stated on customers' bills for the purchase and consumption 21 of food and beverages, to the extent that the proceeds of the 22 service charge are in fact turned over as tips or as a 23 substitute for tips to the employees who participate directly 24 in preparing, serving, hosting or cleaning up the food or 25 beverage function with respect to which the service charge is 26 imposed. 27 (10) Oil field exploration, drilling, and production 28 equipment, including (i) rigs and parts of rigs, rotary rigs, 29 cable tool rigs, and workover rigs, (ii) pipe and tubular 30 goods, including casing and drill strings, (iii) pumps and 31 pump-jack units, (iv) storage tanks and flow lines, (v) any 32 individual replacement part for oil field exploration, 33 drilling, and production equipment, and (vi) machinery and 34 equipment purchased for lease; but excluding motor vehicles SB1929 Engrossed -48- LRB9111995SMdv 1 required to be registered under the Illinois Vehicle Code. 2 (11) Photoprocessing machinery and equipment, including 3 repair and replacement parts, both new and used, including 4 that manufactured on special order, certified by the 5 purchaser to be used primarily for photoprocessing, and 6 including photoprocessing machinery and equipment purchased 7 for lease. 8 (12) Coal exploration, mining, offhighway hauling, 9 processing, maintenance, and reclamation equipment, including 10 replacement parts and equipment, and including equipment 11 purchased for lease, but excluding motor vehicles required to 12 be registered under the Illinois Vehicle Code. 13 (13) Food for human consumption that is to be consumed 14 off the premises where it is sold (other than alcoholic 15 beverages, soft drinks and food that has been prepared for 16 immediate consumption) and prescription and non-prescription 17 medicines, drugs, medical appliances, and insulin, urine 18 testing materials, syringes, and needles used by diabetics, 19 for human use, when purchased for use by a person receiving 20 medical assistance under Article 5 of the Illinois Public Aid 21 Code who resides in a licensed long-term care facility, as 22 defined in the Nursing Home Care Act. 23 (14) Semen used for artificial insemination of livestock 24 for direct agricultural production. 25 (15) Horses, or interests in horses, registered with and 26 meeting the requirements of any of the Arabian Horse Club 27 Registry of America, Appaloosa Horse Club, American Quarter 28 Horse Association, United States Trotting Association, or 29 Jockey Club, as appropriate, used for purposes of breeding or 30 racing for prizes. 31 (16) Computers and communications equipment utilized for 32 any hospital purpose and equipment used in the diagnosis, 33 analysis, or treatment of hospital patients sold to a lessor 34 who leases the equipment, under a lease of one year or longer SB1929 Engrossed -49- LRB9111995SMdv 1 executed or in effect at the time of the purchase, to a 2 hospital that has been issued an active tax exemption 3 identification number by the Department under Section 1g of 4 the Retailers' Occupation Tax Act. This paragraph is exempt 5 from the provisions of Section 3-55. 6 (17) Personal property sold to a lessor who leases the 7 property, under a lease of one year or longer executed or in 8 effect at the time of the purchase, to a governmental body 9 that has been issued an active tax exemption identification 10 number by the Department under Section 1g of the Retailers' 11 Occupation Tax Act. This paragraph is exempt from the 12 provisions of Section 3-55. 13 (18) Beginning with taxable years ending on or after 14 December 31, 1995 and ending with taxable years ending on or 15 before December 31, 2004, personal property that is donated 16 for disaster relief to be used in a State or federally 17 declared disaster area in Illinois or bordering Illinois by a 18 manufacturer or retailer that is registered in this State to 19 a corporation, society, association, foundation, or 20 institution that has been issued a sales tax exemption 21 identification number by the Department that assists victims 22 of the disaster who reside within the declared disaster area. 23 (19) Beginning with taxable years ending on or after 24 December 31, 1995 and ending with taxable years ending on or 25 before December 31, 2004, personal property that is used in 26 the performance of infrastructure repairs in this State, 27 including but not limited to municipal roads and streets, 28 access roads, bridges, sidewalks, waste disposal systems, 29 water and sewer line extensions, water distribution and 30 purification facilities, storm water drainage and retention 31 facilities, and sewage treatment facilities, resulting from a 32 State or federally declared disaster in Illinois or bordering 33 Illinois when such repairs are initiated on facilities 34 located in the declared disaster area within 6 months after SB1929 Engrossed -50- LRB9111995SMdv 1 the disaster. 2 (20) Beginning July 1, 1999, game or game birds sold at 3 a "game breeding and hunting preserve area" or an "exotic 4 game hunting area" as those terms are used in the Wildlife 5 Code or at a hunting enclosure approved through rules adopted 6 by the Department of Natural Resources. This paragraph is 7 exempt from the provisions of Section 3-55. 8 (21)(20)A motor vehicle, as that term is defined in 9 Section 1-146 of the Illinois Vehicle Code, that is donated 10 to a corporation, limited liability company, society, 11 association, foundation, or institution that is determined by 12 the Department to be organized and operated exclusively for 13 educational purposes. For purposes of this exemption, "a 14 corporation, limited liability company, society, association, 15 foundation, or institution organized and operated exclusively 16 for educational purposes" means all tax-supported public 17 schools, private schools that offer systematic instruction in 18 useful branches of learning by methods common to public 19 schools and that compare favorably in their scope and 20 intensity with the course of study presented in tax-supported 21 schools, and vocational or technical schools or institutes 22 organized and operated exclusively to provide a course of 23 study of not less than 6 weeks duration and designed to 24 prepare individuals to follow a trade or to pursue a manual, 25 technical, mechanical, industrial, business, or commercial 26 occupation. 27 (22)(21)Beginning January 1, 2000, personal property, 28 including food, purchased through fundraising events for the 29 benefit of a public or private elementary or secondary 30 school, a group of those schools, or one or more school 31 districts if the events are sponsored by an entity recognized 32 by the school district that consists primarily of volunteers 33 and includes parents and teachers of the school children. 34 This paragraph does not apply to fundraising events (i) for SB1929 Engrossed -51- LRB9111995SMdv 1 the benefit of private home instruction or (ii) for which the 2 fundraising entity purchases the personal property sold at 3 the events from another individual or entity that sold the 4 property for the purpose of resale by the fundraising entity 5 and that profits from the sale to the fundraising entity. 6 This paragraph is exempt from the provisions of Section 3-55. 7 (23)(20)Beginning January 1, 2000, new or used 8 automatic vending machines that prepare and serve hot food 9 and beverages, including coffee, soup, and other items, and 10 replacement parts for these machines. This paragraph is 11 exempt from the provisions of Section 3-55. 12 (24) Beginning January 1, 2001, qualified technological 13 equipment sold to lessors for lease under leases subject to 14 the Qualified Technological Equipment Leasing Occupation and 15 Use Tax Act. This paragraph is exempt from the provisions of 16 Section 3-55. 17 (Source: P.A. 90-14, eff. 7-1-97; 90-552, eff. 12-12-97; 18 90-605, eff. 6-30-98; 91-51, eff. 6-30-99; 91-200, eff. 19 7-20-99; 91-439, eff. 8-6-99; 91-533, eff. 8-13-99; 91-637, 20 eff. 8-20-99; 91-644, eff. 8-20-99; revised 9-29-99.) 21 Section 125. The Retailers' Occupation Tax Act is 22 amended by adding Sections 1c-5 and 3.5 and changing 23 Sections 2-5 and 3 as follows: 24 (35 ILCS 120/1c-5 new) 25 Sec. 1c-5. Sale of used qualified technological 26 equipment by lessors. A person who is engaged in the 27 business of leasing qualified technological equipment under 28 leases subject to the Qualified Technological Equipment 29 Leasing Occupation and Use Tax Act and who, in connection 30 with that business, sells the property to a purchaser for his 31 or her use and not for the purpose of resale, is a retailer 32 engaged in the business of selling tangible personal property SB1929 Engrossed -52- LRB9111995SMdv 1 at retail under this Act to the extent of the value of the 2 property sold. 3 (35 ILCS 120/2-5) (from Ch. 120, par. 441-5) 4 Sec. 2-5. Exemptions. Gross receipts from proceeds from 5 the sale of the following tangible personal property are 6 exempt from the tax imposed by this Act: 7 (1) Farm chemicals. 8 (2) Farm machinery and equipment, both new and used, 9 including that manufactured on special order, certified by 10 the purchaser to be used primarily for production agriculture 11 or State or federal agricultural programs, including 12 individual replacement parts for the machinery and equipment, 13 including machinery and equipment purchased for lease, and 14 including implements of husbandry defined in Section 1-130 of 15 the Illinois Vehicle Code, farm machinery and agricultural 16 chemical and fertilizer spreaders, and nurse wagons required 17 to be registered under Section 3-809 of the Illinois Vehicle 18 Code, but excluding other motor vehicles required to be 19 registered under the Illinois Vehicle Code. Horticultural 20 polyhouses or hoop houses used for propagating, growing, or 21 overwintering plants shall be considered farm machinery and 22 equipment under this item (2). Agricultural chemical tender 23 tanks and dry boxes shall include units sold separately from 24 a motor vehicle required to be licensed and units sold 25 mounted on a motor vehicle required to be licensed, if the 26 selling price of the tender is separately stated. 27 Farm machinery and equipment shall include precision 28 farming equipment that is installed or purchased to be 29 installed on farm machinery and equipment including, but not 30 limited to, tractors, harvesters, sprayers, planters, 31 seeders, or spreaders. Precision farming equipment includes, 32 but is not limited to, soil testing sensors, computers, 33 monitors, software, global positioning and mapping systems, SB1929 Engrossed -53- LRB9111995SMdv 1 and other such equipment. 2 Farm machinery and equipment also includes computers, 3 sensors, software, and related equipment used primarily in 4 the computer-assisted operation of production agriculture 5 facilities, equipment, and activities such as, but not 6 limited to, the collection, monitoring, and correlation of 7 animal and crop data for the purpose of formulating animal 8 diets and agricultural chemicals. This item (7) is exempt 9 from the provisions of Section 2-70. 10 (3) Distillation machinery and equipment, sold as a unit 11 or kit, assembled or installed by the retailer, certified by 12 the user to be used only for the production of ethyl alcohol 13 that will be used for consumption as motor fuel or as a 14 component of motor fuel for the personal use of the user, and 15 not subject to sale or resale. 16 (4) Graphic arts machinery and equipment, including 17 repair and replacement parts, both new and used, and 18 including that manufactured on special order or purchased for 19 lease, certified by the purchaser to be used primarily for 20 graphic arts production. 21 (5) A motor vehicle of the first division, a motor 22 vehicle of the second division that is a self-contained motor 23 vehicle designed or permanently converted to provide living 24 quarters for recreational, camping, or travel use, with 25 direct walk through access to the living quarters from the 26 driver's seat, or a motor vehicle of the second division that 27 is of the van configuration designed for the transportation 28 of not less than 7 nor more than 16 passengers, as defined in 29 Section 1-146 of the Illinois Vehicle Code, that is used for 30 automobile renting, as defined in the Automobile Renting 31 Occupation and Use Tax Act. 32 (6) Personal property sold by a teacher-sponsored 33 student organization affiliated with an elementary or 34 secondary school located in Illinois. SB1929 Engrossed -54- LRB9111995SMdv 1 (7) Proceeds of that portion of the selling price of a 2 passenger car the sale of which is subject to the Replacement 3 Vehicle Tax. 4 (8) Personal property sold to an Illinois county fair 5 association for use in conducting, operating, or promoting 6 the county fair. 7 (9) Personal property sold to a not-for-profit arts or 8 cultural organization that establishes, by proof required by 9 the Department by rule, that it has received an exemption 10 under Section 501(c)(3) of the Internal Revenue Code and that 11 is organized and operated for the presentation or support of 12 arts or cultural programming, activities, or services. These 13 organizations include, but are not limited to, music and 14 dramatic arts organizations such as symphony orchestras and 15 theatrical groups, arts and cultural service organizations, 16 local arts councils, visual arts organizations, and media 17 arts organizations. 18 (10) Personal property sold by a corporation, society, 19 association, foundation, institution, or organization, other 20 than a limited liability company, that is organized and 21 operated as a not-for-profit service enterprise for the 22 benefit of persons 65 years of age or older if the personal 23 property was not purchased by the enterprise for the purpose 24 of resale by the enterprise. 25 (11) Personal property sold to a governmental body, to a 26 corporation, society, association, foundation, or institution 27 organized and operated exclusively for charitable, religious, 28 or educational purposes, or to a not-for-profit corporation, 29 society, association, foundation, institution, or 30 organization that has no compensated officers or employees 31 and that is organized and operated primarily for the 32 recreation of persons 55 years of age or older. A limited 33 liability company may qualify for the exemption under this 34 paragraph only if the limited liability company is organized SB1929 Engrossed -55- LRB9111995SMdv 1 and operated exclusively for educational purposes. On and 2 after July 1, 1987, however, no entity otherwise eligible for 3 this exemption shall make tax-free purchases unless it has an 4 active identification number issued by the Department. 5 (12) Personal property sold to interstate carriers for 6 hire for use as rolling stock moving in interstate commerce 7 or to lessors under leases of one year or longer executed or 8 in effect at the time of purchase by interstate carriers for 9 hire for use as rolling stock moving in interstate commerce 10 and equipment operated by a telecommunications provider, 11 licensed as a common carrier by the Federal Communications 12 Commission, which is permanently installed in or affixed to 13 aircraft moving in interstate commerce. 14 (13) Proceeds from sales to owners, lessors, or shippers 15 of tangible personal property that is utilized by interstate 16 carriers for hire for use as rolling stock moving in 17 interstate commerce and equipment operated by a 18 telecommunications provider, licensed as a common carrier by 19 the Federal Communications Commission, which is permanently 20 installed in or affixed to aircraft moving in interstate 21 commerce. 22 (14) Machinery and equipment that will be used by the 23 purchaser, or a lessee of the purchaser, primarily in the 24 process of manufacturing or assembling tangible personal 25 property for wholesale or retail sale or lease, whether the 26 sale or lease is made directly by the manufacturer or by some 27 other person, whether the materials used in the process are 28 owned by the manufacturer or some other person, or whether 29 the sale or lease is made apart from or as an incident to the 30 seller's engaging in the service occupation of producing 31 machines, tools, dies, jigs, patterns, gauges, or other 32 similar items of no commercial value on special order for a 33 particular purchaser. 34 (15) Proceeds of mandatory service charges separately SB1929 Engrossed -56- LRB9111995SMdv 1 stated on customers' bills for purchase and consumption of 2 food and beverages, to the extent that the proceeds of the 3 service charge are in fact turned over as tips or as a 4 substitute for tips to the employees who participate directly 5 in preparing, serving, hosting or cleaning up the food or 6 beverage function with respect to which the service charge is 7 imposed. 8 (16) Petroleum products sold to a purchaser if the 9 seller is prohibited by federal law from charging tax to the 10 purchaser. 11 (17) Tangible personal property sold to a common carrier 12 by rail or motor that receives the physical possession of the 13 property in Illinois and that transports the property, or 14 shares with another common carrier in the transportation of 15 the property, out of Illinois on a standard uniform bill of 16 lading showing the seller of the property as the shipper or 17 consignor of the property to a destination outside Illinois, 18 for use outside Illinois. 19 (18) Legal tender, currency, medallions, or gold or 20 silver coinage issued by the State of Illinois, the 21 government of the United States of America, or the government 22 of any foreign country, and bullion. 23 (19) Oil field exploration, drilling, and production 24 equipment, including (i) rigs and parts of rigs, rotary rigs, 25 cable tool rigs, and workover rigs, (ii) pipe and tubular 26 goods, including casing and drill strings, (iii) pumps and 27 pump-jack units, (iv) storage tanks and flow lines, (v) any 28 individual replacement part for oil field exploration, 29 drilling, and production equipment, and (vi) machinery and 30 equipment purchased for lease; but excluding motor vehicles 31 required to be registered under the Illinois Vehicle Code. 32 (20) Photoprocessing machinery and equipment, including 33 repair and replacement parts, both new and used, including 34 that manufactured on special order, certified by the SB1929 Engrossed -57- LRB9111995SMdv 1 purchaser to be used primarily for photoprocessing, and 2 including photoprocessing machinery and equipment purchased 3 for lease. 4 (21) Coal exploration, mining, offhighway hauling, 5 processing, maintenance, and reclamation equipment, including 6 replacement parts and equipment, and including equipment 7 purchased for lease, but excluding motor vehicles required to 8 be registered under the Illinois Vehicle Code. 9 (22) Fuel and petroleum products sold to or used by an 10 air carrier, certified by the carrier to be used for 11 consumption, shipment, or storage in the conduct of its 12 business as an air common carrier, for a flight destined for 13 or returning from a location or locations outside the United 14 States without regard to previous or subsequent domestic 15 stopovers. 16 (23) A transaction in which the purchase order is 17 received by a florist who is located outside Illinois, but 18 who has a florist located in Illinois deliver the property to 19 the purchaser or the purchaser's donee in Illinois. 20 (24) Fuel consumed or used in the operation of ships, 21 barges, or vessels that are used primarily in or for the 22 transportation of property or the conveyance of persons for 23 hire on rivers bordering on this State if the fuel is 24 delivered by the seller to the purchaser's barge, ship, or 25 vessel while it is afloat upon that bordering river. 26 (25) A motor vehicle sold in this State to a nonresident 27 even though the motor vehicle is delivered to the nonresident 28 in this State, if the motor vehicle is not to be titled in 29 this State, and if a driveaway decal permit is issued to the 30 motor vehicle as provided in Section 3-603 of the Illinois 31 Vehicle Code or if the nonresident purchaser has vehicle 32 registration plates to transfer to the motor vehicle upon 33 returning to his or her home state. The issuance of the 34 driveaway decal permit or having the out-of-state SB1929 Engrossed -58- LRB9111995SMdv 1 registration plates to be transferred is prima facie evidence 2 that the motor vehicle will not be titled in this State. 3 (26) Semen used for artificial insemination of livestock 4 for direct agricultural production. 5 (27) Horses, or interests in horses, registered with and 6 meeting the requirements of any of the Arabian Horse Club 7 Registry of America, Appaloosa Horse Club, American Quarter 8 Horse Association, United States Trotting Association, or 9 Jockey Club, as appropriate, used for purposes of breeding or 10 racing for prizes. 11 (28) Computers and communications equipment utilized for 12 any hospital purpose and equipment used in the diagnosis, 13 analysis, or treatment of hospital patients sold to a lessor 14 who leases the equipment, under a lease of one year or longer 15 executed or in effect at the time of the purchase, to a 16 hospital that has been issued an active tax exemption 17 identification number by the Department under Section 1g of 18 this Act. This paragraph is exempt from the provisions of 19 Section 2-70. 20 (29) Personal property sold to a lessor who leases the 21 property, under a lease of one year or longer executed or in 22 effect at the time of the purchase, to a governmental body 23 that has been issued an active tax exemption identification 24 number by the Department under Section 1g of this Act. This 25 paragraph is exempt from the provisions of Section 2-70. 26 (30) Beginning with taxable years ending on or after 27 December 31, 1995 and ending with taxable years ending on or 28 before December 31, 2004, personal property that is donated 29 for disaster relief to be used in a State or federally 30 declared disaster area in Illinois or bordering Illinois by a 31 manufacturer or retailer that is registered in this State to 32 a corporation, society, association, foundation, or 33 institution that has been issued a sales tax exemption 34 identification number by the Department that assists victims SB1929 Engrossed -59- LRB9111995SMdv 1 of the disaster who reside within the declared disaster area. 2 (31) Beginning with taxable years ending on or after 3 December 31, 1995 and ending with taxable years ending on or 4 before December 31, 2004, personal property that is used in 5 the performance of infrastructure repairs in this State, 6 including but not limited to municipal roads and streets, 7 access roads, bridges, sidewalks, waste disposal systems, 8 water and sewer line extensions, water distribution and 9 purification facilities, storm water drainage and retention 10 facilities, and sewage treatment facilities, resulting from a 11 State or federally declared disaster in Illinois or bordering 12 Illinois when such repairs are initiated on facilities 13 located in the declared disaster area within 6 months after 14 the disaster. 15 (32) Beginning July 1, 1999, game or game birds sold at 16 a "game breeding and hunting preserve area" or an "exotic 17 game hunting area" as those terms are used in the Wildlife 18 Code or at a hunting enclosure approved through rules adopted 19 by the Department of Natural Resources. This paragraph is 20 exempt from the provisions of Section 2-70. 21 (33)(32)A motor vehicle, as that term is defined in 22 Section 1-146 of the Illinois Vehicle Code, that is donated 23 to a corporation, limited liability company, society, 24 association, foundation, or institution that is determined by 25 the Department to be organized and operated exclusively for 26 educational purposes. For purposes of this exemption, "a 27 corporation, limited liability company, society, association, 28 foundation, or institution organized and operated exclusively 29 for educational purposes" means all tax-supported public 30 schools, private schools that offer systematic instruction in 31 useful branches of learning by methods common to public 32 schools and that compare favorably in their scope and 33 intensity with the course of study presented in tax-supported 34 schools, and vocational or technical schools or institutes SB1929 Engrossed -60- LRB9111995SMdv 1 organized and operated exclusively to provide a course of 2 study of not less than 6 weeks duration and designed to 3 prepare individuals to follow a trade or to pursue a manual, 4 technical, mechanical, industrial, business, or commercial 5 occupation. 6 (34)(33)Beginning January 1, 2000, personal property, 7 including food, purchased through fundraising events for the 8 benefit of a public or private elementary or secondary 9 school, a group of those schools, or one or more school 10 districts if the events are sponsored by an entity recognized 11 by the school district that consists primarily of volunteers 12 and includes parents and teachers of the school children. 13 This paragraph does not apply to fundraising events (i) for 14 the benefit of private home instruction or (ii) for which the 15 fundraising entity purchases the personal property sold at 16 the events from another individual or entity that sold the 17 property for the purpose of resale by the fundraising entity 18 and that profits from the sale to the fundraising entity. 19 This paragraph is exempt from the provisions of Section 2-70. 20 (35)(32)Beginning January 1, 2000, new or used 21 automatic vending machines that prepare and serve hot food 22 and beverages, including coffee, soup, and other items, and 23 replacement parts for these machines. This paragraph is 24 exempt from the provisions of Section 2-70. 25 (36) Beginning January 1, 2001, qualified technological 26 equipment sold to lessors for lease under leases subject to 27 the Qualified Technological Equipment Leasing Occupation and 28 Use Tax Act. This paragraph is exempt from the provisions of 29 Section 2-70. 30 (Source: P.A. 90-14, eff. 7-1-97; 90-519, eff. 6-1-98; 31 90-552, eff. 12-12-97; 90-605, eff. 6-30-98; 91-51, eff. 32 6-30-99; 91-200, eff. 7-20-99; 91-439, eff. 8-6-99; 91-533, 33 eff. 8-13-99; 91-637, eff. 8-20-99; 91-644, eff. 8-20-99; 34 revised 9-28-99.) SB1929 Engrossed -61- LRB9111995SMdv 1 (35 ILCS 120/3) (from Ch. 120, par. 442) 2 Sec. 3. Except as provided in this Section, on or before 3 the twentieth day of each calendar month, every person 4 engaged in the business of selling tangible personal property 5 at retail in this State during the preceding calendar month 6 shall file a return with the Department, stating: 7 1. The name of the seller; 8 2. His residence address and the address of his 9 principal place of business and the address of the 10 principal place of business (if that is a different 11 address) from which he engages in the business of selling 12 tangible personal property at retail in this State; 13 3. Total amount of receipts received by him during 14 the preceding calendar month or quarter, as the case may 15 be, from sales of tangible personal property, and from 16 services furnished, by him during such preceding calendar 17 month or quarter; 18 4. Total amount received by him during the 19 preceding calendar month or quarter on charge and time 20 sales of tangible personal property, and from services 21 furnished, by him prior to the month or quarter for which 22 the return is filed; 23 5. Deductions allowed by law; 24 6. Gross receipts which were received by him during 25 the preceding calendar month or quarter and upon the 26 basis of which the tax is imposed; 27 7. The amount of credit provided in Section 2d of 28 this Act; 29 8. The amount of tax due; 30 9. The signature of the taxpayer; and 31 10. Such other reasonable information as the 32 Department may require. 33 If a taxpayer fails to sign a return within 30 days after 34 the proper notice and demand for signature by the Department, SB1929 Engrossed -62- LRB9111995SMdv 1 the return shall be considered valid and any amount shown to 2 be due on the return shall be deemed assessed. 3 Each return shall be accompanied by the statement of 4 prepaid tax issued pursuant to Section 2e for which credit is 5 claimed. 6 A retailer may accept a Manufacturer's Purchase Credit 7 certification from a purchaser in satisfaction of Use Tax as 8 provided in Section 3-85 of the Use Tax Act if the purchaser 9 provides the appropriate documentation as required by Section 10 3-85 of the Use Tax Act. A Manufacturer's Purchase Credit 11 certification, accepted by a retailer as provided in Section 12 3-85 of the Use Tax Act, may be used by that retailer to 13 satisfy Retailers' Occupation Tax liability in the amount 14 claimed in the certification, not to exceed 6.25% of the 15 receipts subject to tax from a qualifying purchase. 16 The Department may require returns to be filed on a 17 quarterly basis. If so required, a return for each calendar 18 quarter shall be filed on or before the twentieth day of the 19 calendar month following the end of such calendar quarter. 20 The taxpayer shall also file a return with the Department for 21 each of the first two months of each calendar quarter, on or 22 before the twentieth day of the following calendar month, 23 stating: 24 1. The name of the seller; 25 2. The address of the principal place of business 26 from which he engages in the business of selling tangible 27 personal property at retail in this State; 28 3. The total amount of taxable receipts received by 29 him during the preceding calendar month from sales of 30 tangible personal property by him during such preceding 31 calendar month, including receipts from charge and time 32 sales, but less all deductions allowed by law; 33 4. The amount of credit provided in Section 2d of 34 this Act; SB1929 Engrossed -63- LRB9111995SMdv 1 5. The amount of tax due; and 2 6. Such other reasonable information as the 3 Department may require. 4 If a total amount of less than $1 is payable, refundable 5 or creditable, such amount shall be disregarded if it is less 6 than 50 cents and shall be increased to $1 if it is 50 cents 7 or more. 8 Beginning October 1, 1993, a taxpayer who has an average 9 monthly tax liability of $150,000 or more shall make all 10 payments required by rules of the Department by electronic 11 funds transfer. Beginning October 1, 1994, a taxpayer who 12 has an average monthly tax liability of $100,000 or more 13 shall make all payments required by rules of the Department 14 by electronic funds transfer. Beginning October 1, 1995, a 15 taxpayer who has an average monthly tax liability of $50,000 16 or more shall make all payments required by rules of the 17 Department by electronic funds transfer. Beginning October 18 1, 2000, a taxpayer who has an annual tax liability of 19 $200,000 or more shall make all payments required by rules of 20 the Department by electronic funds transfer. The term 21 "annual tax liability" shall be the sum of the taxpayer's 22 liabilities under this Act, and under all other State and 23 local occupation and use tax laws administered by the 24 Department, for the immediately preceding calendar year. The 25 term "average monthly tax liability" shall be the sum of the 26 taxpayer's liabilities under this Act, and under all other 27 State and local occupation and use tax laws administered by 28 the Department, for the immediately preceding calendar year 29 divided by 12. 30 Before August 1 of each year beginning in 1993, the 31 Department shall notify all taxpayers required to make 32 payments by electronic funds transfer. All taxpayers 33 required to make payments by electronic funds transfer shall 34 make those payments for a minimum of one year beginning on SB1929 Engrossed -64- LRB9111995SMdv 1 October 1. 2 Any taxpayer not required to make payments by electronic 3 funds transfer may make payments by electronic funds transfer 4 with the permission of the Department. 5 All taxpayers required to make payment by electronic 6 funds transfer and any taxpayers authorized to voluntarily 7 make payments by electronic funds transfer shall make those 8 payments in the manner authorized by the Department. 9 The Department shall adopt such rules as are necessary to 10 effectuate a program of electronic funds transfer and the 11 requirements of this Section. 12 Any amount which is required to be shown or reported on 13 any return or other document under this Act shall, if such 14 amount is not a whole-dollar amount, be increased to the 15 nearest whole-dollar amount in any case where the fractional 16 part of a dollar is 50 cents or more, and decreased to the 17 nearest whole-dollar amount where the fractional part of a 18 dollar is less than 50 cents. 19 If the retailer is otherwise required to file a monthly 20 return and if the retailer's average monthly tax liability to 21 the Department does not exceed $200, the Department may 22 authorize his returns to be filed on a quarter annual basis, 23 with the return for January, February and March of a given 24 year being due by April 20 of such year; with the return for 25 April, May and June of a given year being due by July 20 of 26 such year; with the return for July, August and September of 27 a given year being due by October 20 of such year, and with 28 the return for October, November and December of a given year 29 being due by January 20 of the following year. 30 If the retailer is otherwise required to file a monthly 31 or quarterly return and if the retailer's average monthly tax 32 liability with the Department does not exceed $50, the 33 Department may authorize his returns to be filed on an annual 34 basis, with the return for a given year being due by January SB1929 Engrossed -65- LRB9111995SMdv 1 20 of the following year. 2 Such quarter annual and annual returns, as to form and 3 substance, shall be subject to the same requirements as 4 monthly returns. 5 Notwithstanding any other provision in this Act 6 concerning the time within which a retailer may file his 7 return, in the case of any retailer who ceases to engage in a 8 kind of business which makes him responsible for filing 9 returns under this Act, such retailer shall file a final 10 return under this Act with the Department not more than one 11 month after discontinuing such business. 12 Where the same person has more than one business 13 registered with the Department under separate registrations 14 under this Act, such person may not file each return that is 15 due as a single return covering all such registered 16 businesses, but shall file separate returns for each such 17 registered business. 18 In addition, with respect to motor vehicles, watercraft, 19 aircraft, and trailers that are required to be registered 20 with an agency of this State, every retailer selling this 21 kind of tangible personal property shall file, with the 22 Department, upon a form to be prescribed and supplied by the 23 Department, a separate return for each such item of tangible 24 personal property which the retailer sells, except that 25 where, in the same transaction, a retailer of aircraft, 26 watercraft, motor vehicles or trailers transfers more than 27 one aircraft, watercraft, motor vehicle or trailer to another 28 aircraft, watercraft, motor vehicle retailer or trailer 29 retailer for the purpose of resale, that seller for resale 30 may report the transfer of all aircraft, watercraft, motor 31 vehicles or trailers involved in that transaction to the 32 Department on the same uniform invoice-transaction reporting 33 return form. For purposes of this Section, "watercraft" 34 means a Class 2, Class 3, or Class 4 watercraft as defined in SB1929 Engrossed -66- LRB9111995SMdv 1 Section 3-2 of the Boat Registration and Safety Act, a 2 personal watercraft, or any boat equipped with an inboard 3 motor. 4 Any retailer who sells only motor vehicles, watercraft, 5 aircraft, or trailers that are required to be registered with 6 an agency of this State, so that all retailers' occupation 7 tax liability is required to be reported, and is reported, on 8 such transaction reporting returns and who is not otherwise 9 required to file monthly or quarterly returns, need not file 10 monthly or quarterly returns. However, those retailers shall 11 be required to file returns on an annual basis. 12 The transaction reporting return, in the case of motor 13 vehicles or trailers that are required to be registered with 14 an agency of this State, shall be the same document as the 15 Uniform Invoice referred to in Section 5-402 of The Illinois 16 Vehicle Code and must show the name and address of the 17 seller; the name and address of the purchaser; the amount of 18 the selling price including the amount allowed by the 19 retailer for traded-in property, if any; the amount allowed 20 by the retailer for the traded-in tangible personal property, 21 if any, to the extent to which Section 1 of this Act allows 22 an exemption for the value of traded-in property; the balance 23 payable after deducting such trade-in allowance from the 24 total selling price; the amount of tax due from the retailer 25 with respect to such transaction; the amount of tax collected 26 from the purchaser by the retailer on such transaction (or 27 satisfactory evidence that such tax is not due in that 28 particular instance, if that is claimed to be the fact); the 29 place and date of the sale; a sufficient identification of 30 the property sold; such other information as is required in 31 Section 5-402 of The Illinois Vehicle Code, and such other 32 information as the Department may reasonably require. 33 The transaction reporting return in the case of 34 watercraft or aircraft must show the name and address of the SB1929 Engrossed -67- LRB9111995SMdv 1 seller; the name and address of the purchaser; the amount of 2 the selling price including the amount allowed by the 3 retailer for traded-in property, if any; the amount allowed 4 by the retailer for the traded-in tangible personal property, 5 if any, to the extent to which Section 1 of this Act allows 6 an exemption for the value of traded-in property; the balance 7 payable after deducting such trade-in allowance from the 8 total selling price; the amount of tax due from the retailer 9 with respect to such transaction; the amount of tax collected 10 from the purchaser by the retailer on such transaction (or 11 satisfactory evidence that such tax is not due in that 12 particular instance, if that is claimed to be the fact); the 13 place and date of the sale, a sufficient identification of 14 the property sold, and such other information as the 15 Department may reasonably require. 16 Such transaction reporting return shall be filed not 17 later than 20 days after the day of delivery of the item that 18 is being sold, but may be filed by the retailer at any time 19 sooner than that if he chooses to do so. The transaction 20 reporting return and tax remittance or proof of exemption 21 from the Illinois use tax may be transmitted to the 22 Department by way of the State agency with which, or State 23 officer with whom the tangible personal property must be 24 titled or registered (if titling or registration is required) 25 if the Department and such agency or State officer determine 26 that this procedure will expedite the processing of 27 applications for title or registration. 28 With each such transaction reporting return, the retailer 29 shall remit the proper amount of tax due (or shall submit 30 satisfactory evidence that the sale is not taxable if that is 31 the case), to the Department or its agents, whereupon the 32 Department shall issue, in the purchaser's name, a use tax 33 receipt (or a certificate of exemption if the Department is 34 satisfied that the particular sale is tax exempt) which such SB1929 Engrossed -68- LRB9111995SMdv 1 purchaser may submit to the agency with which, or State 2 officer with whom, he must title or register the tangible 3 personal property that is involved (if titling or 4 registration is required) in support of such purchaser's 5 application for an Illinois certificate or other evidence of 6 title or registration to such tangible personal property. 7 No retailer's failure or refusal to remit tax under this 8 Act precludes a user, who has paid the proper tax to the 9 retailer, from obtaining his certificate of title or other 10 evidence of title or registration (if titling or registration 11 is required) upon satisfying the Department that such user 12 has paid the proper tax (if tax is due) to the retailer. The 13 Department shall adopt appropriate rules to carry out the 14 mandate of this paragraph. 15 If the user who would otherwise pay tax to the retailer 16 wants the transaction reporting return filed and the payment 17 of the tax or proof of exemption made to the Department 18 before the retailer is willing to take these actions and such 19 user has not paid the tax to the retailer, such user may 20 certify to the fact of such delay by the retailer and may 21 (upon the Department being satisfied of the truth of such 22 certification) transmit the information required by the 23 transaction reporting return and the remittance for tax or 24 proof of exemption directly to the Department and obtain his 25 tax receipt or exemption determination, in which event the 26 transaction reporting return and tax remittance (if a tax 27 payment was required) shall be credited by the Department to 28 the proper retailer's account with the Department, but 29 without the 2.1% or 1.75% discount provided for in this 30 Section being allowed. When the user pays the tax directly 31 to the Department, he shall pay the tax in the same amount 32 and in the same form in which it would be remitted if the tax 33 had been remitted to the Department by the retailer. 34 Refunds made by the seller during the preceding return SB1929 Engrossed -69- LRB9111995SMdv 1 period to purchasers, on account of tangible personal 2 property returned to the seller, shall be allowed as a 3 deduction under subdivision 5 of his monthly or quarterly 4 return, as the case may be, in case the seller had 5 theretofore included the receipts from the sale of such 6 tangible personal property in a return filed by him and had 7 paid the tax imposed by this Act with respect to such 8 receipts. 9 Where the seller is a corporation, the return filed on 10 behalf of such corporation shall be signed by the president, 11 vice-president, secretary or treasurer or by the properly 12 accredited agent of such corporation. 13 Where the seller is a limited liability company, the 14 return filed on behalf of the limited liability company shall 15 be signed by a manager, member, or properly accredited agent 16 of the limited liability company. 17 Except as provided in this Section, the retailer filing 18 the return under this Section shall, at the time of filing 19 such return, pay to the Department the amount of tax imposed 20 by this Act less a discount of 2.1% prior to January 1, 1990 21 and 1.75% on and after January 1, 1990, or $5 per calendar 22 year, whichever is greater, which is allowed to reimburse the 23 retailer for the expenses incurred in keeping records, 24 preparing and filing returns, remitting the tax and supplying 25 data to the Department on request. Any prepayment made 26 pursuant to Section 2d of this Act shall be included in the 27 amount on which such 2.1% or 1.75% discount is computed. In 28 the case of retailers who report and pay the tax on a 29 transaction by transaction basis, as provided in this 30 Section, such discount shall be taken with each such tax 31 remittance instead of when such retailer files his periodic 32 return. 33 Before October 1, 2000, if the taxpayer's average monthly 34 tax liability to the Department under this Act, the Use Tax SB1929 Engrossed -70- LRB9111995SMdv 1 Act, the Service Occupation Tax Act, and the Service Use Tax 2 Act, excluding any liability for prepaid sales tax to be 3 remitted in accordance with Section 2d of this Act, was 4 $10,000 or more during the preceding 4 complete calendar 5 quarters, he shall file a return with the Department each 6 month by the 20th day of the month next following the month 7 during which such tax liability is incurred and shall make 8 payments to the Department on or before the 7th, 15th, 22nd 9 and last day of the month during which such liability is 10 incurred. On and after October 1, 2000, if the taxpayer's 11 average monthly tax liability to the Department under this 12 Act, the Use Tax Act, the Service Occupation Tax Act, and the 13 Service Use Tax Act, excluding any liability for prepaid 14 sales tax to be remitted in accordance with Section 2d of 15 this Act, was $20,000 or more during the preceding 4 complete 16 calendar quarters, he shall file a return with the Department 17 each month by the 20th day of the month next following the 18 month during which such tax liability is incurred and shall 19 make payment to the Department on or before the 7th, 15th, 20 22nd and last day of the month during which such liability is 21 incurred. If the month during which such tax liability is 22 incurred began prior to January 1, 1985, each payment shall 23 be in an amount equal to 1/4 of the taxpayer's actual 24 liability for the month or an amount set by the Department 25 not to exceed 1/4 of the average monthly liability of the 26 taxpayer to the Department for the preceding 4 complete 27 calendar quarters (excluding the month of highest liability 28 and the month of lowest liability in such 4 quarter period). 29 If the month during which such tax liability is incurred 30 begins on or after January 1, 1985 and prior to January 1, 31 1987, each payment shall be in an amount equal to 22.5% of 32 the taxpayer's actual liability for the month or 27.5% of the 33 taxpayer's liability for the same calendar month of the 34 preceding year. If the month during which such tax liability SB1929 Engrossed -71- LRB9111995SMdv 1 is incurred begins on or after January 1, 1987 and prior to 2 January 1, 1988, each payment shall be in an amount equal to 3 22.5% of the taxpayer's actual liability for the month or 4 26.25% of the taxpayer's liability for the same calendar 5 month of the preceding year. If the month during which such 6 tax liability is incurred begins on or after January 1, 1988, 7 and prior to January 1, 1989, or begins on or after January 8 1, 1996, each payment shall be in an amount equal to 22.5% of 9 the taxpayer's actual liability for the month or 25% of the 10 taxpayer's liability for the same calendar month of the 11 preceding year. If the month during which such tax liability 12 is incurred begins on or after January 1, 1989, and prior to 13 January 1, 1996, each payment shall be in an amount equal to 14 22.5% of the taxpayer's actual liability for the month or 25% 15 of the taxpayer's liability for the same calendar month of 16 the preceding year or 100% of the taxpayer's actual liability 17 for the quarter monthly reporting period. The amount of such 18 quarter monthly payments shall be credited against the final 19 tax liability of the taxpayer's return for that month. 20 Before October 1, 2000, once applicable, the requirement of 21 the making of quarter monthly payments to the Department by 22 taxpayers having an average monthly tax liability of $10,000 23 or more as determined in the manner provided above shall 24 continue until such taxpayer's average monthly liability to 25 the Department during the preceding 4 complete calendar 26 quarters (excluding the month of highest liability and the 27 month of lowest liability) is less than $9,000, or until such 28 taxpayer's average monthly liability to the Department as 29 computed for each calendar quarter of the 4 preceding 30 complete calendar quarter period is less than $10,000. 31 However, if a taxpayer can show the Department that a 32 substantial change in the taxpayer's business has occurred 33 which causes the taxpayer to anticipate that his average 34 monthly tax liability for the reasonably foreseeable future SB1929 Engrossed -72- LRB9111995SMdv 1 will fall below the $10,000 threshold stated above, then such 2 taxpayer may petition the Department for a change in such 3 taxpayer's reporting status. On and after October 1, 2000, 4 once applicable, the requirement of the making of quarter 5 monthly payments to the Department by taxpayers having an 6 average monthly tax liability of $20,000 or more as 7 determined in the manner provided above shall continue until 8 such taxpayer's average monthly liability to the Department 9 during the preceding 4 complete calendar quarters (excluding 10 the month of highest liability and the month of lowest 11 liability) is less than $19,000 or until such taxpayer's 12 average monthly liability to the Department as computed for 13 each calendar quarter of the 4 preceding complete calendar 14 quarter period is less than $20,000. However, if a taxpayer 15 can show the Department that a substantial change in the 16 taxpayer's business has occurred which causes the taxpayer to 17 anticipate that his average monthly tax liability for the 18 reasonably foreseeable future will fall below the $20,000 19 threshold stated above, then such taxpayer may petition the 20 Department for a change in such taxpayer's reporting status. 21 The Department shall change such taxpayer's reporting status 22 unless it finds that such change is seasonal in nature and 23 not likely to be long term. If any such quarter monthly 24 payment is not paid at the time or in the amount required by 25 this Section, then the taxpayer shall be liable for penalties 26 and interest on the difference between the minimum amount due 27 as a payment and the amount of such quarter monthly payment 28 actually and timely paid, except insofar as the taxpayer has 29 previously made payments for that month to the Department in 30 excess of the minimum payments previously due as provided in 31 this Section. The Department shall make reasonable rules and 32 regulations to govern the quarter monthly payment amount and 33 quarter monthly payment dates for taxpayers who file on other 34 than a calendar monthly basis. SB1929 Engrossed -73- LRB9111995SMdv 1 Without regard to whether a taxpayer is required to make 2 quarter monthly payments as specified above, any taxpayer who 3 is required by Section 2d of this Act to collect and remit 4 prepaid taxes and has collected prepaid taxes which average 5 in excess of $25,000 per month during the preceding 2 6 complete calendar quarters, shall file a return with the 7 Department as required by Section 2f and shall make payments 8 to the Department on or before the 7th, 15th, 22nd and last 9 day of the month during which such liability is incurred. If 10 the month during which such tax liability is incurred began 11 prior to the effective date of this amendatory Act of 1985, 12 each payment shall be in an amount not less than 22.5% of the 13 taxpayer's actual liability under Section 2d. If the month 14 during which such tax liability is incurred begins on or 15 after January 1, 1986, each payment shall be in an amount 16 equal to 22.5% of the taxpayer's actual liability for the 17 month or 27.5% of the taxpayer's liability for the same 18 calendar month of the preceding calendar year. If the month 19 during which such tax liability is incurred begins on or 20 after January 1, 1987, each payment shall be in an amount 21 equal to 22.5% of the taxpayer's actual liability for the 22 month or 26.25% of the taxpayer's liability for the same 23 calendar month of the preceding year. The amount of such 24 quarter monthly payments shall be credited against the final 25 tax liability of the taxpayer's return for that month filed 26 under this Section or Section 2f, as the case may be. Once 27 applicable, the requirement of the making of quarter monthly 28 payments to the Department pursuant to this paragraph shall 29 continue until such taxpayer's average monthly prepaid tax 30 collections during the preceding 2 complete calendar quarters 31 is $25,000 or less. If any such quarter monthly payment is 32 not paid at the time or in the amount required, the taxpayer 33 shall be liable for penalties and interest on such 34 difference, except insofar as the taxpayer has previously SB1929 Engrossed -74- LRB9111995SMdv 1 made payments for that month in excess of the minimum 2 payments previously due. 3 If any payment provided for in this Section exceeds the 4 taxpayer's liabilities under this Act, the Use Tax Act, the 5 Service Occupation Tax Act and the Service Use Tax Act, as 6 shown on an original monthly return, the Department shall, if 7 requested by the taxpayer, issue to the taxpayer a credit 8 memorandum no later than 30 days after the date of payment. 9 The credit evidenced by such credit memorandum may be 10 assigned by the taxpayer to a similar taxpayer under this 11 Act, the Use Tax Act, the Service Occupation Tax Act or the 12 Service Use Tax Act, in accordance with reasonable rules and 13 regulations to be prescribed by the Department. If no such 14 request is made, the taxpayer may credit such excess payment 15 against tax liability subsequently to be remitted to the 16 Department under this Act, the Use Tax Act, the Service 17 Occupation Tax Act or the Service Use Tax Act, in accordance 18 with reasonable rules and regulations prescribed by the 19 Department. If the Department subsequently determined that 20 all or any part of the credit taken was not actually due to 21 the taxpayer, the taxpayer's 2.1% and 1.75% vendor's discount 22 shall be reduced by 2.1% or 1.75% of the difference between 23 the credit taken and that actually due, and that taxpayer 24 shall be liable for penalties and interest on such 25 difference. 26 If a retailer of motor fuel is entitled to a credit under 27 Section 2d of this Act which exceeds the taxpayer's liability 28 to the Department under this Act for the month which the 29 taxpayer is filing a return, the Department shall issue the 30 taxpayer a credit memorandum for the excess. 31 Beginning January 1, 1990, each month the Department 32 shall pay into the Local Government Tax Fund, a special fund 33 in the State treasury which is hereby created, the net 34 revenue realized for the preceding month from the 1% tax on SB1929 Engrossed -75- LRB9111995SMdv 1 sales of food for human consumption which is to be consumed 2 off the premises where it is sold (other than alcoholic 3 beverages, soft drinks and food which has been prepared for 4 immediate consumption) and prescription and nonprescription 5 medicines, drugs, medical appliances and insulin, urine 6 testing materials, syringes and needles used by diabetics. 7 Beginning January 1, 1990, each month the Department 8 shall pay into the County and Mass Transit District Fund, a 9 special fund in the State treasury which is hereby created, 10 4% of the net revenue realized for the preceding month from 11 the 6.25% general rate. 12 Beginning January 1, 1990, each month the Department 13 shall pay into the Local Government Tax Fund 16% of the net 14 revenue realized for the preceding month from the 6.25% 15 general rate on the selling price of tangible personal 16 property. 17 Of the remainder of the moneys received by the Department 18 pursuant to this Act and the moneys received by the 19 Department from the 80% of the 6.25% occupation tax imposed 20 in Section 10 of the Qualified Technological Equipment 21 Leasing Occupation and Use Tax Act, (a) 1.75% thereof shall 22 be paid into the Build Illinois Fund and (b) prior to July 1, 23 1989, 2.2% and on and after July 1, 1989, 3.8% thereof shall 24 be paid into the Build Illinois Fund; provided, however, that 25 if in any fiscal year the sum of (1) the aggregate of 2.2% or 26 3.8%, as the case may be, of the moneys received by the 27 Department and required to be paid into the Build Illinois 28 Fund pursuant to this Act, Section 9 of the Use Tax Act, 29 Section 9 of the Service Use Tax Act, and Section 9 of the 30 Service Occupation Tax Act, such Acts being hereinafter 31 called the "Tax Acts" and such aggregate of 2.2% or 3.8%, as 32 the case may be, of moneys being hereinafter called the "Tax 33 Act Amount", and (2) the amount transferred to the Build 34 Illinois Fund from the State and Local Sales Tax Reform Fund SB1929 Engrossed -76- LRB9111995SMdv 1 shall be less than the Annual Specified Amount (as 2 hereinafter defined), an amount equal to the difference shall 3 be immediately paid into the Build Illinois Fund from other 4 moneys received by the Department pursuant to the Tax Acts; 5 the "Annual Specified Amount" means the amounts specified 6 below for fiscal years 1986 through 1993: 7 Fiscal Year Annual Specified Amount 8 1986 $54,800,000 9 1987 $76,650,000 10 1988 $80,480,000 11 1989 $88,510,000 12 1990 $115,330,000 13 1991 $145,470,000 14 1992 $182,730,000 15 1993 $206,520,000; 16 and means the Certified Annual Debt Service Requirement (as 17 defined in Section 13 of the Build Illinois Bond Act) or the 18 Tax Act Amount, whichever is greater, for fiscal year 1994 19 and each fiscal year thereafter; and further provided, that 20 if on the last business day of any month the sum of (1) the 21 Tax Act Amount required to be deposited into the Build 22 Illinois Bond Account in the Build Illinois Fund during such 23 month and (2) the amount transferred to the Build Illinois 24 Fund from the State and Local Sales Tax Reform Fund shall 25 have been less than 1/12 of the Annual Specified Amount, an 26 amount equal to the difference shall be immediately paid into 27 the Build Illinois Fund from other moneys received by the 28 Department pursuant to the Tax Acts; and, further provided, 29 that in no event shall the payments required under the 30 preceding proviso result in aggregate payments into the Build 31 Illinois Fund pursuant to this clause (b) for any fiscal year 32 in excess of the greater of (i) the Tax Act Amount or (ii) 33 the Annual Specified Amount for such fiscal year. The 34 amounts payable into the Build Illinois Fund under clause (b) SB1929 Engrossed -77- LRB9111995SMdv 1 of the first sentence in this paragraph shall be payable only 2 until such time as the aggregate amount on deposit under each 3 trust indenture securing Bonds issued and outstanding 4 pursuant to the Build Illinois Bond Act is sufficient, taking 5 into account any future investment income, to fully provide, 6 in accordance with such indenture, for the defeasance of or 7 the payment of the principal of, premium, if any, and 8 interest on the Bonds secured by such indenture and on any 9 Bonds expected to be issued thereafter and all fees and costs 10 payable with respect thereto, all as certified by the 11 Director of the Bureau of the Budget. If on the last 12 business day of any month in which Bonds are outstanding 13 pursuant to the Build Illinois Bond Act, the aggregate of 14 moneys deposited in the Build Illinois Bond Account in the 15 Build Illinois Fund in such month shall be less than the 16 amount required to be transferred in such month from the 17 Build Illinois Bond Account to the Build Illinois Bond 18 Retirement and Interest Fund pursuant to Section 13 of the 19 Build Illinois Bond Act, an amount equal to such deficiency 20 shall be immediately paid from other moneys received by the 21 Department pursuant to the Tax Acts to the Build Illinois 22 Fund; provided, however, that any amounts paid to the Build 23 Illinois Fund in any fiscal year pursuant to this sentence 24 shall be deemed to constitute payments pursuant to clause (b) 25 of the first sentence of this paragraph and shall reduce the 26 amount otherwise payable for such fiscal year pursuant to 27 that clause (b). The moneys received by the Department 28 pursuant to this Act and required to be deposited into the 29 Build Illinois Fund are subject to the pledge, claim and 30 charge set forth in Section 12 of the Build Illinois Bond 31 Act. 32 Subject to payment of amounts into the Build Illinois 33 Fund as provided in the preceding paragraph or in any 34 amendment thereto hereafter enacted, the following specified SB1929 Engrossed -78- LRB9111995SMdv 1 monthly installment of the amount requested in the 2 certificate of the Chairman of the Metropolitan Pier and 3 Exposition Authority provided under Section 8.25f of the 4 State Finance Act, but not in excess of sums designated as 5 "Total Deposit", shall be deposited in the aggregate from 6 collections under Section 9 of the Use Tax Act, Section 9 of 7 the Service Use Tax Act, Section 9 of the Service Occupation 8 Tax Act, and Section 3 of the Retailers' Occupation Tax Act 9 into the McCormick Place Expansion Project Fund in the 10 specified fiscal years. 11 Fiscal Year Total Deposit 12 1993 $0 13 1994 53,000,000 14 1995 58,000,000 15 1996 61,000,000 16 1997 64,000,000 17 1998 68,000,000 18 1999 71,000,000 19 2000 75,000,000 20 2001 80,000,000 21 2002 84,000,000 22 2003 89,000,000 23 2004 93,000,000 24 2005 97,000,000 25 2006 102,000,000 26 2007 108,000,000 27 2008 115,000,000 28 2009 120,000,000 29 2010 126,000,000 30 2011 132,000,000 31 2012 138,000,000 32 2013 and 145,000,000 33 each fiscal year 34 thereafter that bonds SB1929 Engrossed -79- LRB9111995SMdv 1 are outstanding under 2 Section 13.2 of the 3 Metropolitan Pier and 4 Exposition Authority 5 Act, but not after fiscal year 2029. 6 Beginning July 20, 1993 and in each month of each fiscal 7 year thereafter, one-eighth of the amount requested in the 8 certificate of the Chairman of the Metropolitan Pier and 9 Exposition Authority for that fiscal year, less the amount 10 deposited into the McCormick Place Expansion Project Fund by 11 the State Treasurer in the respective month under subsection 12 (g) of Section 13 of the Metropolitan Pier and Exposition 13 Authority Act, plus cumulative deficiencies in the deposits 14 required under this Section for previous months and years, 15 shall be deposited into the McCormick Place Expansion Project 16 Fund, until the full amount requested for the fiscal year, 17 but not in excess of the amount specified above as "Total 18 Deposit", has been deposited. 19 Subject to payment of amounts into the Build Illinois 20 Fund and the McCormick Place Expansion Project Fund pursuant 21 to the preceding paragraphs or in any amendment thereto 22 hereafter enacted, each month the Department shall pay into 23 the Local Government Distributive Fund 0.4% of the net 24 revenue realized for the preceding month from the 5% general 25 rate or 0.4% of 80% of the net revenue realized for the 26 preceding month from the 6.25% general rate, as the case may 27 be, on the selling price of tangible personal property which 28 amount shall, subject to appropriation, be distributed as 29 provided in Section 2 of the State Revenue Sharing Act. No 30 payments or distributions pursuant to this paragraph shall be 31 made if the tax imposed by this Act on photoprocessing 32 products is declared unconstitutional, or if the proceeds 33 from such tax are unavailable for distribution because of 34 litigation. SB1929 Engrossed -80- LRB9111995SMdv 1 Subject to payment of amounts into the Build Illinois 2 Fund, the McCormick Place Expansion Project to the preceding 3 paragraphs or in any amendments thereto hereafter enacted, 4 beginning July 1, 1993, the Department shall each month pay 5 into the Illinois Tax Increment Fund 0.27% of 80% of the net 6 revenue realized for the preceding month from the 6.25% 7 general rate on the selling price of tangible personal 8 property. 9 Of the remainder of the moneys received by the Department 10 pursuant to this Act, 75% thereof shall be paid into the 11 State Treasury and 25% shall be reserved in a special account 12 and used only for the transfer to the Common School Fund as 13 part of the monthly transfer from the General Revenue Fund in 14 accordance with Section 8a of the State Finance Act. 15 The Department may, upon separate written notice to a 16 taxpayer, require the taxpayer to prepare and file with the 17 Department on a form prescribed by the Department within not 18 less than 60 days after receipt of the notice an annual 19 information return for the tax year specified in the notice. 20 Such annual return to the Department shall include a 21 statement of gross receipts as shown by the retailer's last 22 Federal income tax return. If the total receipts of the 23 business as reported in the Federal income tax return do not 24 agree with the gross receipts reported to the Department of 25 Revenue for the same period, the retailer shall attach to his 26 annual return a schedule showing a reconciliation of the 2 27 amounts and the reasons for the difference. The retailer's 28 annual return to the Department shall also disclose the cost 29 of goods sold by the retailer during the year covered by such 30 return, opening and closing inventories of such goods for 31 such year, costs of goods used from stock or taken from stock 32 and given away by the retailer during such year, payroll 33 information of the retailer's business during such year and 34 any additional reasonable information which the Department SB1929 Engrossed -81- LRB9111995SMdv 1 deems would be helpful in determining the accuracy of the 2 monthly, quarterly or annual returns filed by such retailer 3 as provided for in this Section. 4 If the annual information return required by this Section 5 is not filed when and as required, the taxpayer shall be 6 liable as follows: 7 (i) Until January 1, 1994, the taxpayer shall be 8 liable for a penalty equal to 1/6 of 1% of the tax due 9 from such taxpayer under this Act during the period to be 10 covered by the annual return for each month or fraction 11 of a month until such return is filed as required, the 12 penalty to be assessed and collected in the same manner 13 as any other penalty provided for in this Act. 14 (ii) On and after January 1, 1994, the taxpayer 15 shall be liable for a penalty as described in Section 3-4 16 of the Uniform Penalty and Interest Act. 17 The chief executive officer, proprietor, owner or highest 18 ranking manager shall sign the annual return to certify the 19 accuracy of the information contained therein. Any person 20 who willfully signs the annual return containing false or 21 inaccurate information shall be guilty of perjury and 22 punished accordingly. The annual return form prescribed by 23 the Department shall include a warning that the person 24 signing the return may be liable for perjury. 25 The provisions of this Section concerning the filing of 26 an annual information return do not apply to a retailer who 27 is not required to file an income tax return with the United 28 States Government. 29 As soon as possible after the first day of each month, 30 upon certification of the Department of Revenue, the 31 Comptroller shall order transferred and the Treasurer shall 32 transfer from the General Revenue Fund to the Motor Fuel Tax 33 Fund an amount equal to 1.7% of 80% of the net revenue 34 realized under this Act for the second preceding month. SB1929 Engrossed -82- LRB9111995SMdv 1 Beginning April 1, 2000, this transfer is no longer required 2 and shall not be made. 3 Net revenue realized for a month shall be the revenue 4 collected by the State pursuant to this Act, less the amount 5 paid out during that month as refunds to taxpayers for 6 overpayment of liability. 7 For greater simplicity of administration, manufacturers, 8 importers and wholesalers whose products are sold at retail 9 in Illinois by numerous retailers, and who wish to do so, may 10 assume the responsibility for accounting and paying to the 11 Department all tax accruing under this Act with respect to 12 such sales, if the retailers who are affected do not make 13 written objection to the Department to this arrangement. 14 Any person who promotes, organizes, provides retail 15 selling space for concessionaires or other types of sellers 16 at the Illinois State Fair, DuQuoin State Fair, county fairs, 17 local fairs, art shows, flea markets and similar exhibitions 18 or events, including any transient merchant as defined by 19 Section 2 of the Transient Merchant Act of 1987, is required 20 to file a report with the Department providing the name of 21 the merchant's business, the name of the person or persons 22 engaged in merchant's business, the permanent address and 23 Illinois Retailers Occupation Tax Registration Number of the 24 merchant, the dates and location of the event and other 25 reasonable information that the Department may require. The 26 report must be filed not later than the 20th day of the month 27 next following the month during which the event with retail 28 sales was held. Any person who fails to file a report 29 required by this Section commits a business offense and is 30 subject to a fine not to exceed $250. 31 Any person engaged in the business of selling tangible 32 personal property at retail as a concessionaire or other type 33 of seller at the Illinois State Fair, county fairs, art 34 shows, flea markets and similar exhibitions or events, or any SB1929 Engrossed -83- LRB9111995SMdv 1 transient merchants, as defined by Section 2 of the Transient 2 Merchant Act of 1987, may be required to make a daily report 3 of the amount of such sales to the Department and to make a 4 daily payment of the full amount of tax due. The Department 5 shall impose this requirement when it finds that there is a 6 significant risk of loss of revenue to the State at such an 7 exhibition or event. Such a finding shall be based on 8 evidence that a substantial number of concessionaires or 9 other sellers who are not residents of Illinois will be 10 engaging in the business of selling tangible personal 11 property at retail at the exhibition or event, or other 12 evidence of a significant risk of loss of revenue to the 13 State. The Department shall notify concessionaires and other 14 sellers affected by the imposition of this requirement. In 15 the absence of notification by the Department, the 16 concessionaires and other sellers shall file their returns as 17 otherwise required in this Section. 18 (Source: P.A. 90-491, eff. 1-1-99; 90-612, eff. 7-8-98; 19 91-37, eff. 7-1-99; 91-51, eff. 6-30-99; 91-101, eff. 20 7-12-99; 91-541, eff. 8-13-99; revised 9-29-99.) 21 (35 ILCS 120/3.5 new) 22 Sec. 3.5. Refund; leaseback transaction. A purchaser of 23 qualified technological equipment, as defined in Section 5 of 24 the Qualified Technological Equipment Leasing Occupation and 25 Use Tax Act, may obtain a refund of all tax paid to a seller 26 under this Act or any other tax administered by the 27 Department if the purchaser sells the property to a rentor 28 under a bona fide sale and leaseback transaction (to such 29 purchaser) within 90 days of the first functional use of the 30 property. The purchaser shall request the refund from the 31 seller to whom he or she has paid the tax in the same manner 32 and subject to the same requirements as other refunds 33 provided in Section 3 of this Act. For purposes of this SB1929 Engrossed -84- LRB9111995SMdv 1 Section, the first functional use of property shall be the 2 use for which the property is intended, which shall, in the 3 absence of other evidence, be presumed to be the date of 4 delivery of the property. 5 Section 999. Effective date. This Act takes effect 6 January 1, 2001. SB1929 Engrossed -85- LRB9111995SMdv 1 INDEX 2 Statutes amended in order of appearance 3 30 ILCS 115/1 from Ch. 85, par. 611 4 35 ILCS 105/3-5 from Ch. 120, par. 439.3-5 5 35 ILCS 105/9 from Ch. 120, par. 439.9 6 35 ILCS 105/9.5 new 7 35 ILCS 110/3-5 from Ch. 120, par. 439.33-5 8 35 ILCS 115/3-5 from Ch. 120, par. 439.103-5 9 35 ILCS 120/1c-5 new 10 35 ILCS 120/2-5 from Ch. 120, par. 441-5 11 35 ILCS 120/3 from Ch. 120, par. 442 12 35 ILCS 120/3.5 new