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Public Act 92-0742
SB2209 Enrolled LRB9212101SMdv
AN ACT concerning taxes.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Uniform Penalty and Interest Act is
amended by changing Section 3-3 as follows:
(35 ILCS 735/3-3) (from Ch. 120, par. 2603-3)
Sec. 3-3. Penalty for failure to file or pay.
(a) This subsection (a) is applicable before January 1,
1996. A penalty of 5% of the tax required to be shown due on
a return shall be imposed for failure to file the tax return
on or before the due date prescribed for filing determined
with regard for any extension of time for filing (penalty for
late filing or nonfiling). If any unprocessable return is
corrected and filed within 21 days after notice by the
Department, the late filing or nonfiling penalty shall not
apply. If a penalty for late filing or nonfiling is imposed
in addition to a penalty for late payment, the total penalty
due shall be the sum of the late filing penalty and the
applicable late payment penalty. Beginning on the effective
date of this amendatory Act of 1995, in the case of any type
of tax return required to be filed more frequently than
annually, when the failure to file the tax return on or
before the date prescribed for filing (including any
extensions) is shown to be nonfraudulent and has not occurred
in the 2 years immediately preceding the failure to file on
the prescribed due date, the penalty imposed by Section
3-3(a) shall be abated.
(a-5) This subsection (a-5) is applicable to returns due
on and after January 1, 1996 and on or before December 31,
2000. A penalty equal to 2% of the tax required to be shown
due on a return, up to a maximum amount of $250, determined
without regard to any part of the tax that is paid on time or
by any credit that was properly allowable on the date the
return was required to be filed, shall be imposed for failure
to file the tax return on or before the due date prescribed
for filing determined with regard for any extension of time
for filing. However, if any return is not filed within 30
days after notice of nonfiling mailed by the Department to
the last known address of the taxpayer contained in
Department records, an additional penalty amount shall be
imposed equal to the greater of $250 or 2% of the tax shown
on the return. However, the additional penalty amount may
not exceed $5,000 and is determined without regard to any
part of the tax that is paid on time or by any credit that
was properly allowable on the date the return was required to
be filed (penalty for late filing or nonfiling). If any
unprocessable return is corrected and filed within 30 days
after notice by the Department, the late filing or nonfiling
penalty shall not apply. If a penalty for late filing or
nonfiling is imposed in addition to a penalty for late
payment, the total penalty due shall be the sum of the late
filing penalty and the applicable late payment penalty. In
the case of any type of tax return required to be filed more
frequently than annually, when the failure to file the tax
return on or before the date prescribed for filing (including
any extensions) is shown to be nonfraudulent and has not
occurred in the 2 years immediately preceding the failure to
file on the prescribed due date, the penalty imposed by
Section 3-3(a-5) shall be abated.
(a-10) This subsection (a-10) is applicable to returns
due on and after January 1, 2001. A penalty equal to 2% of
the tax required to be shown due on a return, up to a maximum
amount of $250, reduced by any tax that is paid on time or by
any credit that was properly allowable on the date the return
was required to be filed, shall be imposed for failure to
file the tax return on or before the due date prescribed for
filing determined with regard for any extension of time for
filing. However, if any return is not filed within 30 days
after notice of nonfiling mailed by the Department to the
last known address of the taxpayer contained in Department
records, an additional penalty amount shall be imposed equal
to the greater of $250 or 2% of the tax shown on the return.
However, the additional penalty amount may not exceed $5,000
and is determined without regard to any part of the tax that
is paid on time or by any credit that was properly allowable
on the date the return was required to be filed (penalty for
late filing or nonfiling). If any unprocessable return is
corrected and filed within 30 days after notice by the
Department, the late filing or nonfiling penalty shall not
apply. If a penalty for late filing or nonfiling is imposed
in addition to a penalty for late payment, the total penalty
due shall be the sum of the late filing penalty and the
applicable late payment penalty. In the case of any type of
tax return required to be filed more frequently than
annually, when the failure to file the tax return on or
before the date prescribed for filing (including any
extensions) is shown to be nonfraudulent and has not occurred
in the 2 years immediately preceding the failure to file on
the prescribed due date, the penalty imposed by Section
3-3(a-10) shall be abated.
(b) This subsection is applicable before January 1,
1998. A penalty of 15% of the tax shown on the return or the
tax required to be shown due on the return shall be imposed
for failure to pay:
(1) the tax shown due on the return on or before
the due date prescribed for payment of that tax, an
amount of underpayment of estimated tax, or an amount
that is reported in an amended return other than an
amended return timely filed as required by subsection (b)
of Section 506 of the Illinois Income Tax Act (penalty
for late payment or nonpayment of admitted liability); or
(2) the full amount of any tax required to be shown
due on a return and which is not shown (penalty for late
payment or nonpayment of additional liability), within 30
days after a notice of arithmetic error, notice and
demand, or a final assessment is issued by the
Department. In the case of a final assessment arising
following a protest and hearing, the 30-day period shall
not begin until all proceedings in court for review of
the final assessment have terminated or the period for
obtaining a review has expired without proceedings for a
review having been instituted. In the case of a notice
of tax liability that becomes a final assessment without
a protest and hearing, the penalty provided in this
paragraph (2) shall be imposed at the expiration of the
period provided for the filing of a protest.
(b-5) This subsection is applicable to returns due on
and after January 1, 1998 and on or before December 31, 2000.
A penalty of 20% of the tax shown on the return or the tax
required to be shown due on the return shall be imposed for
failure to pay:
(1) the tax shown due on the return on or before
the due date prescribed for payment of that tax, an
amount of underpayment of estimated tax, or an amount
that is reported in an amended return other than an
amended return timely filed as required by subsection (b)
of Section 506 of the Illinois Income Tax Act (penalty
for late payment or nonpayment of admitted liability); or
(2) the full amount of any tax required to be shown
due on a return and which is not shown (penalty for late
payment or nonpayment of additional liability), within 30
days after a notice of arithmetic error, notice and
demand, or a final assessment is issued by the
Department. In the case of a final assessment arising
following a protest and hearing, the 30-day period shall
not begin until all proceedings in court for review of
the final assessment have terminated or the period for
obtaining a review has expired without proceedings for a
review having been instituted. In the case of a notice
of tax liability that becomes a final assessment without
a protest and hearing, the penalty provided in this
paragraph (2) shall be imposed at the expiration of the
period provided for the filing of a protest.
(b-10) This subsection (b-10) is applicable to returns
due on and after January 1, 2001. A penalty shall be imposed
for failure to pay:
(1) the tax shown due on a return on or before the
due date prescribed for payment of that tax, an amount of
underpayment of estimated tax, or an amount that is
reported in an amended return other than an amended
return timely filed as required by subsection (b) of
Section 506 of the Illinois Income Tax Act (penalty for
late payment or nonpayment of admitted liability). The
amount of penalty imposed under this subsection (b-10)(1)
shall be 2% of any amount that is paid no later than 30
days after the due date, 5% of any amount that is paid
later than 30 days after the due date and not later than
90 days after the due date, 10% of any amount that is
paid later than 90 days after the due date and not later
than 180 days after the due date, and 15% of any amount
that is paid later than 180 days after the due date. If
notice and demand is made for the payment of any amount
of tax due and if the amount due is paid within 30 days
after the date of the notice and demand, then the penalty
for late payment or nonpayment of admitted liability
under this subsection (b-10)(1) on the amount so paid
shall not accrue for the period after the date of the
notice and demand.
(2) the full amount of any tax required to be shown
due on a return and that is not shown (penalty for late
payment or nonpayment of additional liability), within 30
days after a notice of arithmetic error, notice and
demand, or a final assessment is issued by the
Department. In the case of a final assessment arising
following a protest and hearing, the 30-day period shall
not begin until all proceedings in court for review of
the final assessment have terminated or the period for
obtaining a review has expired without proceedings for a
review having been instituted. The amount of penalty
imposed under this subsection (b-10)(2) shall be 20% of
any amount that is not paid within the 30-day period. In
the case of a notice of tax liability that becomes a
final assessment without a protest and hearing, the
penalty provided in this subsection (b-10)(2) shall be
imposed at the expiration of the period provided for the
filing of a protest.
(c) For purposes of the late payment penalties, the
basis of the penalty shall be the tax shown or required to be
shown on a return, whichever is applicable, reduced by any
part of the tax which is paid on time and by any credit which
was properly allowable on the date the return was required to
be filed.
(d) A penalty shall be applied to the tax required to be
shown even if that amount is less than the tax shown on the
return.
(e) This subsection (e) is applicable to returns due
before January 1, 2001. If both a subsection (b)(1) or
(b-5)(1) penalty and a subsection (b)(2) or (b-5)(2) penalty
are assessed against the same return, the subsection (b)(2)
or (b-5)(2) penalty shall be assessed against only the
additional tax found to be due.
(e-5) This subsection (e-5) is applicable to returns due
on and after January 1, 2001. If both a subsection (b-10)(1)
penalty and a subsection (b-10)(2) penalty are assessed
against the same return, the subsection (b-10)(2) penalty
shall be assessed against only the additional tax found to be
due.
(f) If the taxpayer has failed to file the return, the
Department shall determine the correct tax according to its
best judgment and information, which amount shall be prima
facie evidence of the correctness of the tax due.
(g) The time within which to file a return or pay an
amount of tax due without imposition of a penalty does not
extend the time within which to file a protest to a notice of
tax liability or a notice of deficiency.
(h) No return shall be determined to be unprocessable
because of the omission of any information requested on the
return pursuant to Section 2505-575 of the Department of
Revenue Law (20 ILCS 2505/2505-575).
(Source: P.A. 90-491, eff. 1-1-98; 90-548, eff. 12-4-97;
91-239, eff. 1-1-00; 91-803, eff. 1-1-01.)
Section 99. Effective date. This Act takes effect upon
becoming law.
Passed in the General Assembly May 09, 2002.
Approved July 25, 2002.
Effective July 25, 2002.
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