093_SB0969ham001
LRB093 02878 RCE 17006 a
1 AMENDMENT TO SENATE BILL 969
2 AMENDMENT NO. . Amend Senate Bill 969 by replacing
3 everything after the enacting clause with the following:
4 "Section 1. Short title. This Act may be cited as the Tax
5 Delinquency Amnesty Act.
6 Section 5. Definitions. As used in this Act:
7 "Department" means the Illinois Department of Revenue.
8 "Rules" means any rules adopted or forms prescribed by
9 the Department.
10 "Taxable period" means any period of time for which any
11 tax is imposed by and owed to the State of Illinois.
12 "Taxpayer" means any person, corporation, or other entity
13 subject to any tax, except for the motor fuel use tax,
14 imposed by any law of the State of Illinois and payable to
15 the State of Illinois.
16 Section 10. Amnesty program. The Department shall
17 establish an amnesty program for all taxpayers owing any tax
18 imposed by reason of or pursuant to authorization by any law
19 of the State of Illinois and collected by the Department.
20 The amnesty program shall be for a period from October 1,
21 2003 through November 15, 2003.
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1 The amnesty program shall provide that, upon payment by a
2 taxpayer of all taxes due from that taxpayer to the State of
3 Illinois for any taxable period ending after June 30, 1983
4 and prior to July 1, 2002, the Department shall abate and not
5 seek to collect any interest or penalties that may be
6 applicable and the Department shall not seek civil or
7 criminal prosecution for any taxpayer for the period of time
8 for which amnesty has been granted to the taxpayer. Failure
9 to pay all taxes due to the State for a taxable period shall
10 invalidate any amnesty granted under this Act. Amnesty shall
11 be granted only if all amnesty conditions are satisfied by
12 the taxpayer.
13 Amnesty shall not be granted to taxpayers who are a party
14 to any criminal investigation or to any civil or criminal
15 litigation that is pending in any circuit court or appellate
16 court or the Supreme Court of this State for nonpayment,
17 delinquency, or fraud in relation to any State tax imposed by
18 any law of the State of Illinois.
19 Voluntary payments made under this Act shall be made by
20 cash, check, guaranteed remittance, or ACH debit.
21 The Department shall adopt rules as necessary to
22 implement the provisions of this Act.
23 Except as otherwise provided in this Section, all money
24 collected under this Act that would otherwise be deposited
25 into the General Revenue Fund shall be deposited as follows:
26 (i) one-half into the Common School Fund; (ii) one-half into
27 the General Revenue Fund. Two percent of all money collected
28 under this Act shall be deposited by the State Treasurer into
29 the Tax Compliance and Administration Fund and, subject to
30 appropriation, shall be used by the Department to cover costs
31 associated with the administration of this Act.
32 Section 905. The Uniform Penalty and Interest Act is
33 amended by changing Sections 3-2, 3-3, 3-4, 3-5, 3-6, and
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1 3-7.5 as follows:
2 (35 ILCS 735/3-2) (from Ch. 120, par. 2603-2)
3 Sec. 3-2. Interest.
4 (a) Interest paid by the Department to taxpayers and
5 interest charged to taxpayers by the Department shall be paid
6 at the annual rate determined by the Department. That rate
7 shall be the underpayment rate established under Section 6621
8 of the Internal Revenue Code.
9 (b) The interest rate shall be adjusted on a semiannual
10 basis, on January 1 and July 1, based upon the underpayment
11 rate going into effect on that January 1 or July 1 under
12 Section 6621 of the Internal Revenue Code.
13 (c) This subsection (c) is applicable to returns due on
14 and before December 31, 2000. Interest shall be simple
15 interest calculated on a daily basis. Interest shall accrue
16 upon tax and penalty due. If notice and demand is made for
17 the payment of any amount of tax due and if the amount due is
18 paid within 30 days after the date of such notice and demand,
19 interest under this Section on the amount so paid shall not
20 be imposed for the period after the date of the notice and
21 demand.
22 (c-5) This subsection (c-5) is applicable to returns due
23 on and after January 1, 2001. Interest shall be simple
24 interest calculated on a daily basis. Interest shall accrue
25 upon tax due. If notice and demand is made for the payment
26 of any amount of tax due and if the amount due is paid within
27 30 days after the date of the notice and demand, interest
28 under this Section on the amount so paid shall not be imposed
29 for the period after the date of the notice and demand.
30 (d) No interest shall be paid upon any overpayment of
31 tax if the overpayment is refunded or a credit approved
32 within 90 days after the last date prescribed for filing the
33 original return, or within 90 days of the receipt of the
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1 processable return, or within 90 days after the date of
2 overpayment, whichever date is latest, as determined without
3 regard to processing time by the Comptroller or without
4 regard to the date on which the credit is applied to the
5 taxpayer's account. In order for an original return to be
6 processable for purposes of this Section, it must be in the
7 form prescribed or approved by the Department, signed by the
8 person authorized by law, and contain all information,
9 schedules, and support documents necessary to determine the
10 tax due and to make allocations of tax as prescribed by law.
11 For the purposes of computing interest, a return shall be
12 deemed to be processable unless the Department notifies the
13 taxpayer that the return is not processable within 90 days
14 after the receipt of the return; however, interest shall not
15 accumulate for the period following this date of notice.
16 Interest on amounts refunded or credited pursuant to the
17 filing of an amended return or claim for refund shall be
18 determined from the due date of the original return or the
19 date of overpayment, whichever is later, to the date of
20 payment by the Department without regard to processing time
21 by the Comptroller or the date of credit by the Department or
22 without regard to the date on which the credit is applied to
23 the taxpayer's account. If a claim for refund relates to an
24 overpayment attributable to a net loss carryback as provided
25 by Section 207 of the Illinois Income Tax Act, the date of
26 overpayment shall be the last day of the taxable year in
27 which the loss was incurred.
28 (e) Interest on erroneous refunds. Any portion of the
29 tax imposed by an Act to which this Act is applicable or any
30 interest or penalty which has been erroneously refunded and
31 which is recoverable by the Department shall bear interest
32 from the date of payment of the refund. However, no interest
33 will be charged if the erroneous refund is for an amount less
34 than $500 and is due to a mistake of the Department.
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1 (f) If a taxpayer has a tax liability that is eligible
2 for amnesty under the Tax Delinquency Amnesty Act and the
3 taxpayer fails to satisfy the tax liability during the
4 amnesty period provided for in that Act, then the interest
5 charged by the Department under this Section shall be imposed
6 at a rate that is 200% of the rate that would otherwise be
7 imposed under this Section.
8 (Source: P.A. 91-803, eff. 1-1-01.)
9 (35 ILCS 735/3-3) (from Ch. 120, par. 2603-3)
10 Sec. 3-3. Penalty for failure to file or pay.
11 (a) This subsection (a) is applicable before January 1,
12 1996. A penalty of 5% of the tax required to be shown due on
13 a return shall be imposed for failure to file the tax return
14 on or before the due date prescribed for filing determined
15 with regard for any extension of time for filing (penalty for
16 late filing or nonfiling). If any unprocessable return is
17 corrected and filed within 21 days after notice by the
18 Department, the late filing or nonfiling penalty shall not
19 apply. If a penalty for late filing or nonfiling is imposed
20 in addition to a penalty for late payment, the total penalty
21 due shall be the sum of the late filing penalty and the
22 applicable late payment penalty. Beginning on the effective
23 date of this amendatory Act of 1995, in the case of any type
24 of tax return required to be filed more frequently than
25 annually, when the failure to file the tax return on or
26 before the date prescribed for filing (including any
27 extensions) is shown to be nonfraudulent and has not occurred
28 in the 2 years immediately preceding the failure to file on
29 the prescribed due date, the penalty imposed by Section
30 3-3(a) shall be abated.
31 (a-5) This subsection (a-5) is applicable to returns due
32 on and after January 1, 1996 and on or before December 31,
33 2000. A penalty equal to 2% of the tax required to be shown
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1 due on a return, up to a maximum amount of $250, determined
2 without regard to any part of the tax that is paid on time or
3 by any credit that was properly allowable on the date the
4 return was required to be filed, shall be imposed for failure
5 to file the tax return on or before the due date prescribed
6 for filing determined with regard for any extension of time
7 for filing. However, if any return is not filed within 30
8 days after notice of nonfiling mailed by the Department to
9 the last known address of the taxpayer contained in
10 Department records, an additional penalty amount shall be
11 imposed equal to the greater of $250 or 2% of the tax shown
12 on the return. However, the additional penalty amount may
13 not exceed $5,000 and is determined without regard to any
14 part of the tax that is paid on time or by any credit that
15 was properly allowable on the date the return was required to
16 be filed (penalty for late filing or nonfiling). If any
17 unprocessable return is corrected and filed within 30 days
18 after notice by the Department, the late filing or nonfiling
19 penalty shall not apply. If a penalty for late filing or
20 nonfiling is imposed in addition to a penalty for late
21 payment, the total penalty due shall be the sum of the late
22 filing penalty and the applicable late payment penalty. In
23 the case of any type of tax return required to be filed more
24 frequently than annually, when the failure to file the tax
25 return on or before the date prescribed for filing (including
26 any extensions) is shown to be nonfraudulent and has not
27 occurred in the 2 years immediately preceding the failure to
28 file on the prescribed due date, the penalty imposed by
29 Section 3-3(a-5) shall be abated.
30 (a-10) This subsection (a-10) is applicable to returns
31 due on and after January 1, 2001. A penalty equal to 2% of
32 the tax required to be shown due on a return, up to a maximum
33 amount of $250, reduced by any tax that is paid on time or by
34 any credit that was properly allowable on the date the return
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1 was required to be filed, shall be imposed for failure to
2 file the tax return on or before the due date prescribed for
3 filing determined with regard for any extension of time for
4 filing. However, if any return is not filed within 30 days
5 after notice of nonfiling mailed by the Department to the
6 last known address of the taxpayer contained in Department
7 records, an additional penalty amount shall be imposed equal
8 to the greater of $250 or 2% of the tax shown on the return.
9 However, the additional penalty amount may not exceed $5,000
10 and is determined without regard to any part of the tax that
11 is paid on time or by any credit that was properly allowable
12 on the date the return was required to be filed (penalty for
13 late filing or nonfiling). If any unprocessable return is
14 corrected and filed within 30 days after notice by the
15 Department, the late filing or nonfiling penalty shall not
16 apply. If a penalty for late filing or nonfiling is imposed
17 in addition to a penalty for late payment, the total penalty
18 due shall be the sum of the late filing penalty and the
19 applicable late payment penalty. In the case of any type of
20 tax return required to be filed more frequently than
21 annually, when the failure to file the tax return on or
22 before the date prescribed for filing (including any
23 extensions) is shown to be nonfraudulent and has not occurred
24 in the 2 years immediately preceding the failure to file on
25 the prescribed due date, the penalty imposed by Section
26 3-3(a-10) shall be abated.
27 (b) This subsection is applicable before January 1,
28 1998. A penalty of 15% of the tax shown on the return or the
29 tax required to be shown due on the return shall be imposed
30 for failure to pay:
31 (1) the tax shown due on the return on or before
32 the due date prescribed for payment of that tax, an
33 amount of underpayment of estimated tax, or an amount
34 that is reported in an amended return other than an
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1 amended return timely filed as required by subsection (b)
2 of Section 506 of the Illinois Income Tax Act (penalty
3 for late payment or nonpayment of admitted liability); or
4 (2) the full amount of any tax required to be shown
5 due on a return and which is not shown (penalty for late
6 payment or nonpayment of additional liability), within 30
7 days after a notice of arithmetic error, notice and
8 demand, or a final assessment is issued by the
9 Department. In the case of a final assessment arising
10 following a protest and hearing, the 30-day period shall
11 not begin until all proceedings in court for review of
12 the final assessment have terminated or the period for
13 obtaining a review has expired without proceedings for a
14 review having been instituted. In the case of a notice
15 of tax liability that becomes a final assessment without
16 a protest and hearing, the penalty provided in this
17 paragraph (2) shall be imposed at the expiration of the
18 period provided for the filing of a protest.
19 (b-5) This subsection is applicable to returns due on
20 and after January 1, 1998 and on or before December 31, 2000.
21 A penalty of 20% of the tax shown on the return or the tax
22 required to be shown due on the return shall be imposed for
23 failure to pay:
24 (1) the tax shown due on the return on or before
25 the due date prescribed for payment of that tax, an
26 amount of underpayment of estimated tax, or an amount
27 that is reported in an amended return other than an
28 amended return timely filed as required by subsection (b)
29 of Section 506 of the Illinois Income Tax Act (penalty
30 for late payment or nonpayment of admitted liability); or
31 (2) the full amount of any tax required to be shown
32 due on a return and which is not shown (penalty for late
33 payment or nonpayment of additional liability), within 30
34 days after a notice of arithmetic error, notice and
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1 demand, or a final assessment is issued by the
2 Department. In the case of a final assessment arising
3 following a protest and hearing, the 30-day period shall
4 not begin until all proceedings in court for review of
5 the final assessment have terminated or the period for
6 obtaining a review has expired without proceedings for a
7 review having been instituted. In the case of a notice
8 of tax liability that becomes a final assessment without
9 a protest and hearing, the penalty provided in this
10 paragraph (2) shall be imposed at the expiration of the
11 period provided for the filing of a protest.
12 (b-10) This subsection (b-10) is applicable to returns
13 due on and after January 1, 2001. A penalty shall be imposed
14 for failure to pay:
15 (1) the tax shown due on a return on or before the
16 due date prescribed for payment of that tax, an amount of
17 underpayment of estimated tax, or an amount that is
18 reported in an amended return other than an amended
19 return timely filed as required by subsection (b) of
20 Section 506 of the Illinois Income Tax Act (penalty for
21 late payment or nonpayment of admitted liability). The
22 amount of penalty imposed under this subsection (b-10)(1)
23 shall be 2% of any amount that is paid no later than 30
24 days after the due date, 5% of any amount that is paid
25 later than 30 days after the due date and not later than
26 90 days after the due date, 10% of any amount that is
27 paid later than 90 days after the due date and not later
28 than 180 days after the due date, and 15% of any amount
29 that is paid later than 180 days after the due date. If
30 notice and demand is made for the payment of any amount
31 of tax due and if the amount due is paid within 30 days
32 after the date of the notice and demand, then the penalty
33 for late payment or nonpayment of admitted liability
34 under this subsection (b-10)(1) on the amount so paid
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1 shall not accrue for the period after the date of the
2 notice and demand.
3 (2) the full amount of any tax required to be shown
4 due on a return and that is not shown (penalty for late
5 payment or nonpayment of additional liability), within 30
6 days after a notice of arithmetic error, notice and
7 demand, or a final assessment is issued by the
8 Department. In the case of a final assessment arising
9 following a protest and hearing, the 30-day period shall
10 not begin until all proceedings in court for review of
11 the final assessment have terminated or the period for
12 obtaining a review has expired without proceedings for a
13 review having been instituted. The amount of penalty
14 imposed under this subsection (b-10)(2) shall be 20% of
15 any amount that is not paid within the 30-day period. In
16 the case of a notice of tax liability that becomes a
17 final assessment without a protest and hearing, the
18 penalty provided in this subsection (b-10)(2) shall be
19 imposed at the expiration of the period provided for the
20 filing of a protest.
21 (c) For purposes of the late payment penalties, the
22 basis of the penalty shall be the tax shown or required to be
23 shown on a return, whichever is applicable, reduced by any
24 part of the tax which is paid on time and by any credit which
25 was properly allowable on the date the return was required to
26 be filed.
27 (d) A penalty shall be applied to the tax required to be
28 shown even if that amount is less than the tax shown on the
29 return.
30 (e) This subsection (e) is applicable to returns due
31 before January 1, 2001. If both a subsection (b)(1) or
32 (b-5)(1) penalty and a subsection (b)(2) or (b-5)(2) penalty
33 are assessed against the same return, the subsection (b)(2)
34 or (b-5)(2) penalty shall be assessed against only the
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1 additional tax found to be due.
2 (e-5) This subsection (e-5) is applicable to returns due
3 on and after January 1, 2001. If both a subsection (b-10)(1)
4 penalty and a subsection (b-10)(2) penalty are assessed
5 against the same return, the subsection (b-10)(2) penalty
6 shall be assessed against only the additional tax found to be
7 due.
8 (f) If the taxpayer has failed to file the return, the
9 Department shall determine the correct tax according to its
10 best judgment and information, which amount shall be prima
11 facie evidence of the correctness of the tax due.
12 (g) The time within which to file a return or pay an
13 amount of tax due without imposition of a penalty does not
14 extend the time within which to file a protest to a notice of
15 tax liability or a notice of deficiency.
16 (h) No return shall be determined to be unprocessable
17 because of the omission of any information requested on the
18 return pursuant to Section 2505-575 of the Department of
19 Revenue Law (20 ILCS 2505/2505-575).
20 (i) If a taxpayer has a tax liability that is eligible
21 for amnesty under the Tax Delinquency Amnesty Act and the
22 taxpayer fails to satisfy the tax liability during the
23 amnesty period provided for in that Act, then the penalty
24 imposed by the Department under this Section shall be imposed
25 in an amount that is 200% of the amount that would otherwise
26 be imposed under this Section.
27 (Source: P.A. 91-239, eff. 1-1-00; 91-803, eff. 1-1-01;
28 92-742, eff. 7-25-02.)
29 (35 ILCS 735/3-4) (from Ch. 120, par. 2603-4)
30 Sec. 3-4. Penalty for failure to file correct
31 information returns.
32 (a) Failure to file correct information returns -
33 imposition of penalty.
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1 (1) In general. Unless otherwise provided in a tax
2 Act, in the case of a failure described in paragraph (2)
3 of this subsection (a) by any person with respect to an
4 information return, that person shall pay a penalty of $5
5 for each return or statement with respect to which the
6 failure occurs, but the total amount imposed on that
7 person for all such failures during any calendar year
8 shall not exceed $25,000.
9 (2) Failures subject to penalty. The following
10 failures are subject to the penalty imposed in paragraph
11 (1) of this subsection (a):
12 (A) any failure to file an information return
13 with the Department on or before the required filing
14 date, or
15 (B) any failure to include all of the
16 information required to be shown on the return or
17 the inclusion of incorrect information.
18 (b) Reduction where correction in specified period.
19 (1) Correction within 60 days. If any failure
20 described in subsection (a) (2) is corrected within 60
21 days after the required filing date:
22 (A) the penalty imposed by subsection (a)
23 shall be reduced by 50%; and
24 (B) the total amount imposed on the person for
25 all such failures during any calendar year which are
26 so corrected shall not exceed 50% of the maximum
27 prescribed in subsection (a) (1).
28 (c) Information return defined. An information return is
29 any tax return required by a tax Act to be filed with the
30 Department that does not, by law, require the payment of a
31 tax liability.
32 (d) If a taxpayer has a tax liability that is eligible
33 for amnesty under the Tax Delinquency Amnesty Act and the
34 taxpayer fails to satisfy the tax liability during the
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1 amnesty period provided for in that Act, then the penalty
2 imposed by the Department under this Section shall be imposed
3 in an amount that is 200% of the amount that would otherwise
4 be imposed under this Section.
5 (Source: P.A. 87-205.)
6 (35 ILCS 735/3-5) (from Ch. 120, par. 2603-5)
7 Sec. 3-5. Penalty for negligence.
8 (a) If any return or amended return is prepared
9 negligently, but without intent to defraud, and filed, in
10 addition to any penalty imposed under Section 3-3 of this
11 Act, a penalty shall be imposed in an amount equal to 20% of
12 any resulting deficiency.
13 (b) Negligence includes any failure to make a reasonable
14 attempt to comply with the provisions of any tax Act and
15 includes careless, reckless, or intentional disregard of the
16 law or regulations.
17 (c) No penalty shall be imposed under this Section if it
18 is shown that failure to comply with the tax Act is due to
19 reasonable cause. A taxpayer is not negligent if the
20 taxpayer shows substantial authority to support the return as
21 filed.
22 (d) If a taxpayer has a tax liability that is eligible
23 for amnesty under the Tax Delinquency Amnesty Act and the
24 taxpayer fails to satisfy the tax liability during the
25 amnesty period provided for in that Act, then the penalty
26 imposed by the Department shall be imposed in an amount that
27 is 200% of the amount that would otherwise be imposed in
28 accordance with this Section.
29 (Source: P.A. 87-205; 87-1189.)
30 (35 ILCS 735/3-6) (from Ch. 120, par. 2603-6)
31 Sec. 3-6. Penalty for fraud.
32 (a) If any return or amended return is filed with intent
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1 to defraud, in addition to any penalty imposed under Section
2 3-3 of this Act, a penalty shall be imposed in an amount
3 equal to 50% of any resulting deficiency.
4 (b) If any claim is filed with intent to defraud, a
5 penalty shall be imposed in an amount equal to 50% of the
6 amount fraudulently claimed for credit or refund.
7 (c) If a taxpayer has a tax liability that is eligible
8 for amnesty under the Tax Delinquency Amnesty Act and the
9 taxpayer fails to satisfy the tax liability during the
10 amnesty period provided for in that Act, then the penalty
11 imposed by the Department under this Section shall be imposed
12 in an amount that is 200% of the amount that would otherwise
13 be imposed under this Section.
14 (Source: P.A. 87-205.)
15 (35 ILCS 735/3-7.5)
16 Sec. 3-7.5. Bad check penalty.
17 (a) In addition to any other penalty provided in this
18 Act, a penalty of $25 shall be imposed on any person who
19 issues a check or other draft to the Department that is not
20 honored upon presentment. The penalty imposed under this
21 Section shall be deemed assessed at the time of presentment
22 of the check or other draft and shall be treated for all
23 purposes, including collection and allocation, as part of the
24 tax or other liability for which the check or other draft
25 represented payment.
26 (b) If a taxpayer has a tax liability that is eligible
27 for amnesty under the Tax Delinquency Amnesty Act and the
28 taxpayer fails to satisfy the tax liability during the
29 amnesty period provided for in that Act, then the penalty
30 imposed by the Department under this Section shall be imposed
31 in an amount that is 200% of the amount that would otherwise
32 be imposed under this Section.
33 (Source: P.A. 91-803, eff. 1-1-01.)
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1 Section 999. Effective date. This Act takes effect upon
2 becoming law.".