Section 750.100  Scope of the Program and Rules

 

a)         Electronic funds transfer replaces the physical movement and handling of paper checks with electronic instructions to financial institutions to transfer funds between accounts of those making and receiving payments.

 

b)         Use of electronic funds transfer is intended to:

 

1)         make the payment of taxes easier for taxpayers;

 

2)         enhance State revenues through acceleration of the collection mechanism for taxes; and

 

3)         improve enforcement and compliance through the elimination of the delays and uncertainties which result from mailing and manually processing paper returns and tax payments.

 

c)         Taxpayers who are required to make tax payments to the Department and have reached the established thresholds for making those payments through the use of electronic funds transfer are required to make those payments to the Department through the use of electronic funds transfer.  (See Section 750.300 of this Part.)

 

d)         Taxpayers, if accepted into the program by the Department, may voluntarily make tax payments to the Department through the use of electronic funds transfer for tax, fees, and other payments listed in Section 750.300 of this Part.

 

(Source:  Amended at 27 Ill. Reg. 14623, effective August 26, 2003)

 

Section 750.200 Definitions

 

The following meanings are to be given to the terms used in this Part:

 

            "ACH" or "Automated Clearing House" means a central distribution and settlement point for the electronic clearing of debits and credits between financial institutions rather than the physical movement of paper items.  The term includes any Federal reserve bank, or an organization established by agreement with the National Automated Clearing House Association, which operates as a clearing house for transmitting or receiving entries between banks and/or bank accounts and which authorizes an electronic transfer of funds between such banks or bank accounts.

 

            "ACH Credit" means an electronic transfer in which the taxpayer, through its own bank, originates an entry for deposit with the Department.

 

            "ACH Debit" means the electronic transfer of funds from the taxpayer's account which is generated upon the taxpayer's instruction and clears the ACH for deposit with the Department.

 

            "Department" means the Illinois Department of Revenue.

 

            "Electronic Funds Transfer" or "EFT" means a transfer of funds, other than a transaction originated by check, draft or similar paper instrument, which is initiated through an electronic terminal, telephone, or computer or magnetic tape so as to order, instruct or authorize a financial institution to debit or credit an account.

 

            "Federal Reserve Wire Transfer" (hereinafter referred to as "Fedwire") means any transaction utilizing the national electronic payment system to transfer funds through Federal Reserve Banks.  For purposes of the electronic funds transfer program a Fedwire is similar to an ACH Credit in that the taxpayer originates a transaction utilizing the Federal Reserve banking system, debiting its own bank account and crediting the State Treasury for the amount of a tax payment.

 

            "Payment Information" means the data which the Department requires of a taxpayer making an EFT payment.

 

            "TXP Banking Convention" means a technical format for the communication of limited tax remittance data accompanying a payment through the Automated Clearing House (ACH) System.  This convention includes a list of standard tax type codes and account type codes.

 

            "Taxpayer" means any person required or permitted to remit an amount by the electronic transfer of funds. For purposes of these rules, "person" includes any individual, firm,  partnership,  joint  venture, association, corporation, estate, limited liability company, trust, business trust, receiver, syndicate, or other group or combination acting as a unit and also includes any political subdivision, municipality, state agency, bureau, or department and includes the plural as well as the singular number.

 

Section 750.300  Payments Required to be Paid by Electronic Funds Transfer

 

a)         Income Tax Payments

 

1)         Beginning on October 1, 1993, certain withholding tax payments and estimated income tax payments will be required to be paid by electronic funds transfer.  The threshold amounts are set by law, change over time, and are detailed below.

 

2)         Beginning on October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more under Article 7 of the Act shall make all payments required by rules of the Department by electronic funds transfer.  Beginning October 1, 1993, a taxpayer who has an average quarterly estimated tax payment obligation of $450,000 or more under Article 8 of the Act shall make all payments required by rules of the Department by electronic funds transfer. (Section 601.1 of the Illinois Income Tax Act [35 ILCS 5/601.1] ("the IITA"))

 

A)        Beginning on October 1, 1994, the threshold for taxpayers with withholding liability under Article 7 of the IITA drops to an average monthly liability of $100,000, and, beginning on October 1, 1995, the threshold drops to an average monthly liability of $50,000.

 

B)        Beginning on October 1, 1994, the threshold for taxpayers with liability for estimated tax payments under Article 8 of the IITA drops to an average quarterly estimated tax payment obligation of $300,000 and, beginning on October 1, 1995, the threshold drops to an average quarterly estimated tax payment obligation of $150,000.

 

C)        Beginning on October 1, 2000, the threshold for taxpayers with withholding liability under Article 7 of the IITA drops to an average annual liability of $200,000 and the threshold for taxpayers with liability for estimated tax payments under Article 8 of the IITA drops to an average quarterly estimated tax payment obligation of $50,000.

 

D)        Beginning October 1, 2002, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments of that tax to the Department by electronic funds transfer.  The term "annual tax liability" means the greater of the amount of the taxpayer's tax liability under Article 7 of the IITA for the immediately preceding calendar year or the taxpayer's estimated tax payment obligation under Article 8 of the IITA for the immediately preceding calendar year. [20 ILCS 2505/2505-210]

 

E)        Beginning October 1, 2010, except as provided in subsection (a)(2)(F), a taxpayer (other than an individual taxpayer) who has an annual tax liability of $20,000 or more and an individual taxpayer who has an annual tax liability of $200,000 or more shall make all payments of that tax to the Department by electronic funds transfer. [20 ILCS 2505/2505-210(b)] The term "annual tax liability" means the greater of the amount of the taxpayer's tax liability under Article 7 of the IITA for the immediately preceding calendar year or the taxpayer's estimated tax payment obligation under Article 8 of the IITA for the immediately preceding calendar year. [20 ILCS 2505/2505-10(d)]

 

F)         Beginning with calendar year 2011, payments of withholding required to be made on a semi-weekly basis under IITA Section 704A(c)(1) must be made by electronic funds transfer. (IITA Section 704A(c)(1)) (See 86 Ill. Adm. Code 100.7325(c)(4).)

 

3)         The Department will only require payments by electronic funds transfer in those circumstances in which it is cost-effective for the Department to receive payments by electronic funds transfer and where receipt of payments by electronic funds transfer is consistent with the Department's tax processing capabilities.

 

4)         Taxpayers over the statutory thresholds will only be required to make certain types of income tax payments by electronic funds transfer.

 

A)        Taxpayers with income tax withholding liabilities over the statutory thresholds shall make IL-501 payments by electronic funds transfer.  All other withholding payments by those taxpayers shall be made by conventional means.

 

B)        Corporate taxpayers with estimated income and replacement tax liabilities over the statutory thresholds shall make IL-1120-ES payments and IL-505-B payments by electronic funds transfer.

 

C)        Individual taxpayers with estimated income tax liabilities over the statutory thresholds shall make IL-1040-ES and IL-505-I payments by electronic funds transfer.

 

D)        Any other taxpayers not listed above who incur estimated income tax liabilities over the statutory thresholds will, upon contact by the Department, be required to make subsequent estimated payments by electronic funds transfer as directed by the Department.

 

b)         State and Local Occupation and Use Tax Payments Reported on Form ST-1, Sales and Use Tax and E911 Surcharge Return

 

1)         Beginning on October 1, 1993, the Department will require certain State and local occupation and use tax payments to be made by electronic funds transfer.  Subsection (b) sets forth the types of payments that must be made by electronic funds transfer.

 

A)        Beginning October 1, 1993, a taxpayer who has an average monthly tax liability of $150,000 or more shall make all payments required by rules of the Department by electronic funds transfer. The term "average monthly tax liability", as used in this subsection (b), shall be the sum of the taxpayer's liabilities under the Retailers' Occupation Tax Act and all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year, divided by 12. (Section 3 of the Retailers' Occupation Tax Act [35 ILCS 120/3] ("the ROT"))

 

B)        Beginning October 1, 1994, the threshold for taxpayers required to make payments by electronic funds transfer drops to those taxpayers with average monthly tax liability of $100,000.

 

C)        Beginning October 1, 1995, the threshold for taxpayers required to make payments by electronic funds transfer drops to those taxpayers with average monthly tax liability of $50,000.

 

D)        Beginning October 1, 2000, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments required by rules of the Department by electronic funds transfer.  The term "annual tax liability" shall be the sum of the taxpayer's liabilities under the Retailers' Occupation Tax Act and all other State and local occupation and use tax laws administered by the Department, for the immediately preceding calendar year.  [35 ILCS 120/3]

 

E)        Beginning October 1, 2002, and through September 30, 2010, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments of that tax to the Department by electronic funds transfer.  The term "annual tax liability" shall be the sum of the taxpayer's liability reported on that taxpayer's Form ST-1, Sales and Use Tax and E911 Surcharge Return [20 ILCS 2505/2505-210].

 

F)         Beginning October 1, 2010, a taxpayer who has an annual tax liability of $20,000 or more shall make all payments of that tax to the Department by electronic funds transfer.  Before August 1 of each year, the Department shall notify all taxpayers required to make payments by electronic funds transfer.  All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1. The term "annual tax liability" means, for a taxpayer that incurs a tax liability under the Retailers' Occupation Tax Act, Service Occupation Tax Act, Use Tax Act, Service Use Tax Act, or any other State or local occupation or use tax law that is administered by the Department, the sum of the taxpayer's liabilities under the Retailers' Occupation Tax Act, Service Occupation Tax Act, Use Tax Act, Service Use Tax Act, and all other State and local occupation and use tax laws administered by the Department for the immediately preceding calendar year. [20 ILCS 2505/2505-210] The term "annual tax liability" shall be the sum of the taxpayer's liability reported on that taxpayer's Form ST-1, Sales and Use Tax and E911 Surcharge Return.

 

2)         The Department will only require payments by electronic funds transfer in those circumstances in which it is cost-effective for the Department to receive payments by electronic funds transfer and where receipt of payments by electronic funds transfer is consistent with the Department's tax processing capabilities.

 

3)         Taxpayers over the statutory thresholds will only be required to make RR-3 sales tax accelerated quarter-monthly payments, ST-1 return payments, PST-1 return payments and PST-3 return payments by electronic funds transfer.  Any other payments that accompany a tax return (for example, ST-1-X return payments, 556 return payments, etc.) may not be paid by electronic funds transfer.

 

c)         Electricity Excise Tax Payments

 

1)         Beginning October 1, 1999, each delivering supplier or self-assessing purchaser whose average monthly liability under the Electricity Excise Tax Law was $10,000 or more is required to make all payments by electronic funds transfer.  The calculation to determine the average monthly liability is made by taking the sum of the liabilities of the delivering supplier or self-assessing purchaser for the immediately preceding calendar year and dividing by the number 12.

 

2)         The Department will calculate the delivering supplier's or self-assessing purchaser's average monthly liability for calendar year 1998, and only for calendar year 1998, by taking the sum of the delivering supplier's or self‑assessing purchaser's liabilities for the last 5 months of calendar year 1998 and dividing by the number 12.

 

3)         Beginning October 1, 2002, and through September 30, 2010, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments of that tax to the Department by electronic funds transfer.  The term "annual tax liability" means the sum of the taxpayer's liabilities for the immediately preceding calendar year.  [20 ILCS 2505/2505-210]

 

4)         Beginning October 1, 2010, a taxpayer who has an annual tax liability of $20,000 or more shall make all payments of that tax to the Department by electronic funds transfer [20 ILCS 2505/2505-210].

 

d)         Other Tax Payments

Beginning on October 1, 2002, and through September 30, 2010, a taxpayer who has an annual tax liability of $200,000 or more shall make all payments of that tax to the Department by electronic funds transfer.  Before August 1 of each year, beginning in 2002, the Department shall notify all taxpayers required to make payments by electronic funds transfer.  All taxpayers required to make payments by electronic funds transfer shall make those payments for a minimum of one year beginning on October 1. Beginning October 1, 2010, a taxpayer who has an annual tax liability of $20,000 or more shall make all payments of that tax to the Department by electronic funds transfer. [20 ILCS 2505/2505-210]  This requirement applies to all taxes administered by the Department not otherwise specified in this Section.

 

e)         Liquor Revenue Tax Payments

Beginning on January 1, 2003, and through September 30, 2010, a taxpayer who has an annual tax liability of $200,000 or more in the immediately preceding calendar year shall make all payments of that tax to the Department by electronic funds transfer.  Beginning October 1, 2010, a taxpayer who has an annual tax liability of $20,000 or more shall make all payments of that tax to the Department by electronic funds transfer. [20 ILCS 2505/2505-210]  A taxpayer who fails to file an electronic report and electronically pay the tax imposed pursuant to Section 8-1 of the Liquor Control Act of 1934 [235 ILCS 5] to the Department on or before the 15^th day of the calendar month following the calendar month in which alcoholic liquor is sold or used by that taxpayer is not entitled to receive the discount provided in Section 8-2 of the Liquor Control Act.

 

f)         Cigarette and Cigarette Use Tax Payments; Tax Stamp Payments

 

1)         Beginning on January 1, 2003, through September 30, 2010, each distributor who has an annual tax liability of $200,000 or more in the immediately preceding calendar year must pay for its cigarette revenue tax stamps by means of electronic funds transfer.  Beginning October 1, 2010, a cigarette manufacturer who is required to file returns pursuant to Section 3 of the Cigarette Tax Act [35 ILCS 130] or Section 3 of the Cigarette Use Tax Act [35 ILCS 135] and has an annual tax liability of $20,000 or more shall make all payments of tax to the Department by electronic funds transfer [20 ILCS 2505/2505-210].  

 

2)         Beginning on January 1, 2003, through June 30, 2003, each distributor who pays for cigarette revenue tax stamps with a postdated draft shall pay such draft by means of electronic funds transfer  [35 ILCS 135/3].  On and after July 1, 2003, payment for tax stamps affixed to original packages of cigarettes and packages of little cigars containing 20 or 25 little cigars must be made by means of electronic funds transfer.

 

3)         Distributors who purchase cigarette revenue tax stamps must pay for their purchases using the ACH debit method.  The ACH credit method is not available to taxpayers who are purchasing cigarette tax stamps. 

 

g)        Hotel Operators' Occupation Tax Payments

Beginning on January 1, 2003, and through September 30, 2010, a taxpayer who has an annual tax liability of $200,000 or more in the immediately preceding calendar year of Hotel Operators' Occupation Tax shall make all payments of that tax to the Department by electronic funds transfer. Beginning October 1, 2010, a taxpayer who has an annual tax liability of $20,000 or more shall make all payments of that tax to the Department by electronic funds transfer [20 ILCS 2505/2505-210].

 

h)        Soft Drink Tax Payments

Beginning on January 1, 2003, and through September 30, 2010, a taxpayer who has an annual tax liability of $200,000 or more in the immediately preceding calendar year of taxes imposed under 8-11-6b of the Illinois Municipal Code [65 ILCS 5/8-11-6b] shall make all payments of that tax to the Department by electronic funds transfer. Beginning October 1, 2010, a taxpayer who has an annual tax liability of $20,000 or more shall make all payments of that tax to the Department by electronic funds transfer [20 ILCS 2505/2505-210].

 

i)          Telecommunications Excise Tax and Simplified Municipal Telecommunications Tax Payments

Beginning on January 1, 2003, a taxpayer who has an average monthly tax liability of the taxes imposed under the Telecommunications Excise Tax Act [35 ILCS 630] and the Simplified Municipal Telecommunications Tax Act [35 ILCS 636/Art. 5] of $1,000 or more for the immediately preceding calendar year shall make all payments of those taxes to the Department by electronic funds transfer and shall file the return required by Section 6 of the Telecommunications Excise Tax Act by electronic means [35 ILCS 630/6].

 

j)          Motor Fuel Tax Law and Environmental Impact Fee Law

Beginning October 1, 2012, payments of the fee imposed by Section 13a.4 of the Motor Fuel Tax Law [35 ILCS 505] shall be made as provided in 86 Ill. Adm. Code 500.305.  Beginning January 1, 2013, payments of taxes and fees imposed by Sections 13a and 13a.5 of the Motor Fuel Tax Law shall be made as provided in 86 Ill. Adm. Code 500.335 and 500.320, respectively.  Beginning January 1, 2016, payments of taxes imposed by Sections 2 and 2a of the Motor Fuel Tax Law and payments of the fee imposed by the Environmental Impact Fee Law [415 ILCS 125/Art. 3] shall be made as provided in 86 Ill. Adm. Code 500.203.

 

k)         Medical Cannabis Cultivation Privilege Tax Law

A taxpayer may voluntarily make payments of the tax imposed by Section 210 of the Medical Cannabis Cultivation Privilege Tax Law [410 ILCS 130/190 through 215] by electronic funds transfer.

 

(Source:  Amended at 40 Ill. Reg. 9229, effective June 24, 2016)

 

Section 750.400  Eligibility Determination and Taxpayer Notification

 

Beginning in 1993, before August 1, the Department shall notify all taxpayers required to make payments by electronic funds transfer.  For all years after 1993, the Department will notify, before August 1, only those taxpayers who become required to make payments by electronic funds transfer.  All taxpayers required to make payments by electronic funds transfer, and all taxpayers accepted for voluntary participation in the program, must complete an authorization agreement for electronic funds transfer (Department Form EFT-1).  Taxpayers who use service groups or other agents to make tax payments remain responsible for completing the authorization agreement.  Service groups or other agents may submit authorization agreements on behalf of taxpayers who have executed a valid Power of Attorney for Electronic Processing, Department Form IL-2848-E, authorizing those service groups or other agents to  complete the authorization agreements and to make tax payments through the use of electronic funds transfer on behalf of those taxpayers. However, all service groups or agents submitting authorization agreements on behalf of taxpayers must retain in their books and records a valid Power of Attorney for Electronic Processing, Department Form IL-2848-E, for each taxpayer that authorizes the service group or other agents to complete the electronic funds transfer authorization, EFT-1, on behalf of those taxpayers.  All service groups or other agents that are required to retain the Powers of Attorney under this Section shall make those Powers of Attorney available to the Department upon request of the Department.   All  taxpayers required or permitted to make payments by electronic funds transfer shall make such payments for a minimum of one year beginning on October 1.

 

(Source:  Amended at 24 Ill. Reg. 3867, effective February 28, 2000)

 

Section 750.500  Voluntary Program Participation

 

a)         Any taxpayer who is not required to make estimated or accelerated payments by electronic  funds transfer is encouraged to seek the permission of the Department to make payments by electronic funds transfer.

 

b)         Taxpayers who wish to voluntarily participate in the electronic funds transfer program must file an application for participation with the Department. Taxpayers should be aware that it will generally take a minimum of 60 days for the Department to process a request for voluntary participation in the electronic funds transfer program.

 

c)         In determining whether to grant or deny an application for participation, the Department will consider the filing and payment history of the taxpayer, the average amount of payments made by the taxpayer and the cost to the Department of the taxpayer's participation in the program versus the cost to the Department of processing traditional forms of payment from the taxpayer.

 

d)         Once an applicant has been approved as a voluntary participant, all required payments must be made by electronic funds transfer for the next twelve months.  Voluntary participants may not switch back and forth between electronic funds transfer and payment by check or draft.  Failure to pay by the due date by electronic funds transfer may be grounds for dismissal from voluntary participation in the program.

 

e)         The Department is accepting voluntary electronic funds transfer payments of the following taxes and fees:

 

            ART-1, Automobile Rental Occupation and Use Tax Return (payment only, beginning October 1, 2002)

 

            CMFT-1, County Motor Fuel Tax Return (payment only, beginning October 1, 2002)

 

ICT-1, Electricity Distribution and Invested Capital Tax Estimated Payment

 

ICT-4, Electricity Distribution and Invested Capital Tax Return (payment only)

 

IL-501, Illinois Withholding Tax Payment

 

IL-505-I, Automatic Extension Payment for Individuals

 

IL-505-B, Payment of Automatic Extension (for corporations, small business corporations, partnerships, fiduciaries, or exempt organizations)

 

IL-1040-ES, Estimated Income Tax Payment for Individuals

 

IL-1120-ES, Estimated Income and Replacement Tax Payment for Corporations

 

PST-1, Prepaid Sales Tax Return (payment only)

 

PST-3, Prepaid Sales Tax Quarter-Monthly Payment (for accelerated sales tax filers)

 

RG-1, Gas Revenue Tax Return (payment only)

 

RPU-13, Electricity Excise Tax Return (payment only)

 

RPU-50, Quarter-Monthly Payment – Electric, Gas, Telecommunications Excise Tax, and Telecommunications Infrastructure Maintenance Fee

 

RR-3, Sales and Use Tax Quarter-Monthly Payment (for accelerated sales and use tax filers)

 

RT-2, Telecommunications Excise Tax Return (payment only)

 

RT-10, Telecommunications Infrastructure Maintenance Fee Return (payment only)

 

RL-26, Liquor Revenue Return (payment only, beginning January 1, 2003)

 

RL-26-A, Liquor Revenue Airline Return (payment only, beginning January 1, 2003)

 

RHM-1, Hotel Operators’ Occupation Tax Return (payment only, beginning January 1, 2003)

 

ST-1, Sales and Use Tax Return (payment only)

 

ST-4, MPEA Food and Beverage Tax Return (payment only, beginning October 1, 2002)

 

ST-14, Chicago Soft Drink Tax Return (payment only, beginning January 1, 2003)

 

TP-1, Tobacco Products Tax Return (payment only, beginning October 1, 2002)

 

Cigarette Tax and Cigarette Use Tax payments (beginning January 1, 2003)

 

f)                  The Department reserves the right to terminate the participation of any voluntary electronic payer who fails to meet the requirements, specifications, and procedures stated in this Part.

 

(Source:  Amended at 27 Ill. Reg. 14623, effective August 26, 2003)

 

Section 750.600   Methods of Electronic Funds Transfer Payment

 

a)         There are two primary methods for payment by electronic funds transfer under the program, along with one emergency backup method.  These methods are ACH Debit, ACH Credit and Fedwire.  Taxpayers may use either the ACH Debit or Credit methods for payment. Taxpayers who are required to pay or voluntarily pay Cigarette Tax or Cigarette Use Tax using EFT must pay their tax liability using an ACH debit payment.  Fedwire is only offered as an emergency backup method of payment.

 

b)         Taxpayers who choose or are required to use the ACH Debit option must use one of the following methods:

 

1)         Place a toll-free call to the Department's data collection service and provide the appropriate account number and required tax payment information.  The data collection service will then provide the taxpayer with a unique "confirmation number" to acknowledge the call.  The data collection service will initiate the ACH Debit to the taxpayer's account the same day the taxpayer calls the Department, except in the case of ACH warehousing by the data collection service, which will be initiated the working day prior to the due date, and a credit to the Department's account will be made the following day. When a taxpayer chooses this payment option, the Department will provide the taxpayer with a detailed set of technical instructions related to the payment mechanism.

 

2)         Taxpayers that are purchasing cigarette tax revenue stamps will not need to place a call to the Department’s data collection service.  However, a debit authorization form provided by the Department must accompany the purchase order invoice. The Department will then initiate all ACH debits for taxpayers who are required to use EFT when purchasing cigarette tax stamps and who provide the Department with their debit authorization.

 

3)         Taxpayers who electronically file their tax return may include an ACH Debit record with the transmission.

 

c)         To use the ACH Credit option, the taxpayer initiates a credit by instructing its bank to transfer the tax due from the taxpayer's account to the Department's account.  The taxpayer's bank will then insert a "trace number" into the payment transaction to be used as a payment verification.  In addition to the payment amount, taxpayer account posting information is sent with the funds transfer using the TXP convention. This is a standard format developed for use by all states accepting tax payments by means of ACH Credit. A copy of the TXP convention is provided as a portion of the technical instructions provided to taxpayers making payment in this form.

 

1)         Before choosing this option on the registration form, a taxpayer should contact its bank to determine what ACH services are offered by the bank.

 

2)         This option is not authorized for taxpayers that purchase cigarette tax stamps.

 

d)         The Fedwire option for payment is offered by the Department only as a backup method.  If this backup method is used, the taxpayer's bank must initiate the Fedwire by noon Central Standard Time on the tax due date.

 

1)         Fedwires have costs associated with them for both the initiator and the receiver.  A taxpayer using this option will be required to pay the initiator's fee, and the receiver fee will be charged to the Department.

 

2)         To effectively credit the payment information to the taxpayer's account, the Department's standard Fedwire format (the Department requires the same data as the TXP convention) information should be entered by taxpayer's bank as part of the Fedwire transaction.  The taxpayer's bank should provide taxpayer with a paper copy of the transmission for taxpayer's records.  A copy of the Department's standard Fedwire format is included in the technical instructions provided all program participants.

 

3)           Fedwire is not a routine electronic funds transfer option.  If a taxpayer uses this emergency backup option, taxpayer must contact the Department by telephone in advance to provide notification of the emergency situation.

 

(Source:  Amended at 30 Ill. Reg. 11583, effective June 26, 2006)

 

Section 750.700  Payment Transmission Errors

 

a)         If a taxpayer does not make a correct payment of tax for a particular period, such taxpayer shall, on the nearest business day to the date on which the error is discovered, contact the Department's Electronic Funds Transfer EFT unit.

 

b)         If the taxpayer error involves an underpayment of tax, the taxpayer must make appropriate arrangements to initiate payment for the amount of the underpayment and penalties and interest.

 

c)         A failure to initiate an electronic funds transfer payment on or before the due date because of circumstances under the taxpayer's control, including but not limited to insufficiency of funds in the taxpayer's account or a direct payment to the Department using an unauthorized payment method, may result in either the loss of discount, the imposition of penalties and interest, or both.

 

(Source:  Amended at 30 Ill. Reg. 11583, effective June 26, 2006)

 

Section 750.800 Department Notification Requirement

 

Taxpayers submitting payments by electronic funds transfer, under either the mandatory or voluntary electronic funds transfer programs, must notify the Department of any change of address, change of bank, or other change which may affect the taxpayer's ability to remit payment on or before the date the tax liability is due.

 

Section 750.900 Due Date; General Provisions

 

a)         Taxpayers who are required to remit tax payments through electronic funds transfer and voluntary program participants must initiate the transfer on or before the due date under the appropriate tax Act and request a payment date no later than the due date or, if a payment date of the due date is unavailable, then no later than the financial institution's next available business day after the due date.  For the payment to be deemed timely by the Department, the transfer must be initiated on or before the due date and must result in the amount due being deposited as collected funds to the Department's account, even if that deposit occurs after the due date.  Taxpayers should be aware that the provisions of Section 1.25 of the Statute on Statutes [5 ILCS 70/1.25] do not apply to payments made by electronic funds transfer as the payments are not transmitted by mail.

 

b)         The electronic funds transfer method of payment does not change any current filing requirements for tax returns.

 

c)         In addition to the provisions for reasonable cause for late payment under the applicable tax laws, for electronic funds transfer purposes, reasonable cause for late payment by electronic funds transfer includes the following:

 

1)         The inability to gain access to the EFT system on the required date because of a system failure beyond the reasonable control of the taxpayer. For example:

 

A)        In the case of ACH debit transactions, the taxpayer is unable to make telephone contact with the system to provide an instruction to transfer funds from the taxpayer's account, or

 

B)        In the case of ACH credit transactions, the taxpayer's bank is unable to gain access to the ACH network to arrange for a deposit of funds with the Department;

 

2)         The failure of the electronic funds transfer system to properly apply a payment.

 

d)         If a taxpayer is required to remit a tax payment through electronic funds transfer but instead makes the payment by mail, the amount due must be physically received by the Department on or before the due date under the appropriate tax Act in order for the payment to be considered timely by the Department.

 

(Source:  Amended at 30 Ill. Reg. 11583, effective June 26, 2006)