SB2612ham001 98TH GENERAL ASSEMBLY

Rep. Barbara Flynn Currie

Filed: 5/21/2014

09800SB2612ham001 LRB098 14519 HLH 59962 a

AMENDMENT TO SENATE BILL 2612

AMENDMENT NO. ______. Amend Senate Bill 2612 immediately below the enacting clause, by inserting the following:

"Section 3. The Department of Revenue Law of the Civil Administrative Code of Illinois is amended by changing Section 2505-190 and by adding Section 2505-180 as follows:

(20 ILCS 2505/2505-180 new)

Sec. 2505-180. Private letter rulings.

(a) The Department shall, subject to the provisions of this Section and rules adopted by the Department, issue private letter rulings in response to written taxpayer inquiries received after December 31, 2014, concerning the application of a tax statute or rule to a specific fact situation.

The Department shall respond to a request for a private letter ruling within 120 days of the date of receipt of the request by issuing a private letter ruling, issuing a letter that declines the request for private letter ruling, or issuing a general information letter. If the Department declines a request for a private letter ruling, the Department must provide the person requesting the ruling the specific reason for the denial. If the Department requests additional information and the taxpayer fails to provide the additional information within 30 days, unless extended by agreement, the private letter ruling request shall be deemed to be withdrawn. If the Department requests additional information, the 120-day period shall be tolled until the additional information is provided by the taxpayer. Each 120-day period may be extended by agreement with the person making the request for a private letter ruling.

Each request for a private letter ruling shall be verified by a written declaration that it is made under the penalty of perjury. The request must be signed by the taxpayer or a person authorized to sign on behalf of the taxpayer.

(b) A private letter ruling request may not be withdrawn by the taxpayer after the Department has completed its review of the request and is prepared to issue a negative ruling, unless agreed to by the Department.

(c) A private letter ruling shall be binding on the Department only as to the taxpayer who is the subject of the request for a ruling, and only if the request contained no omission or misstatement of material fact. A private letter ruling shall cease to bind the Department if there is a pertinent change in statutory law, case law, rules, or material facts. Every private letter ruling is revoked on the date that is 10 years after the date of issuance of the ruling, unless the taxpayer is otherwise notified in writing of an earlier date by the Department.

(20 ILCS 2505/2505-190) (was 20 ILCS 2505/39c-4)

Sec. 2505-190. Tax Compliance and Administration Fund.

(a) Amounts deposited into the Tax Compliance and Administration Fund, a special fund in the State treasury that is hereby created, must be appropriated to the Department to reimburse the Department for its costs of collecting, administering, and enforcing the tax laws that provide for deposits into the Fund.

(b) As soon as possible after July 1, 2015, and as soon as possible after each July 1 thereafter, the Director of the Department of Revenue shall certify the balance in the Tax Compliance and Administration Fund as of July 1, less any amounts obligated, and the State Comptroller shall order transferred and the State Treasurer shall transfer from the Tax Compliance and Administration Fund to the General Revenue Fund the amount certified that exceeds $2,500,000.

(Source: P.A. 91-239, eff. 1-1-00.)"; and

on page 3, line 10, by replacing "5%" with "6%"; and

on page 3, line 21, after "Revenue", by inserting ", in addition to legal staff to assist with implementation of the Department's responsibilities under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois"; and

on page 15, line 2, after "Department,", by inserting "in addition to legal staff to assist with implementation of the Department's responsibilities under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois,"; and

on page 15, line 3, by replacing "5%" with "6%"; and

on page 40, line 7, after "Revenue,", by inserting "in addition to legal staff to assist with implementation of the Department's responsibilities under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois,"; and

on page 40, line 7, by replacing "5%" with "6%"; and

on page 55, line 20, after "Revenue,", by inserting "in addition to legal staff to assist with implementation of the Department's responsibilities under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois,"; and

on page 55, line 20, by replacing "5%" with "6%"; and

on page 71, line 21, after "Revenue,", by inserting "in addition to legal staff to assist with implementation of the Department's responsibilities under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois,"; and

on page 71, line 21, by replacing "5%" with "6%"; and

on page 106, line 2, after "Revenue,", by inserting "in addition to legal staff to assist with implementation of the Department's responsibilities under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois,"; and

on page 106, line 2, by replacing "5%" with "6%"; and

on page 114, line 22, by replacing "5%" with "6%"; and

on page 115, line 3, after "Revenue", by inserting ", in addition to legal staff to assist with implementation of the Department's responsibilities under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois"; and

on page 116, line 21, by replacing "5%" with "6%"; and

on page 117, line 2, after "Revenue", by inserting ", in addition to legal staff to assist with implementation of the Department's responsibilities under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois"; and

on page 117, immediately below line 5, by inserting the following:

"Section 45. The Uniform Penalty and Interest Act is amended by changing Sections 3-6 and 3-8 as follows:

(35 ILCS 735/3-6) (from Ch. 120, par. 2603-6)

Sec. 3-6. Penalty for fraud.

(a) If any return or amended return is filed with intent to defraud, in addition to any penalty imposed under Section 3-3 of this Act, a penalty shall be imposed in an amount equal to 50% of any resulting deficiency.

(b) If any claim is filed with intent to defraud, a penalty shall be imposed in an amount equal to 50% of the amount fraudulently claimed for credit or refund.

(c) If a taxpayer has a tax liability for the taxable period ending after June 30, 1983 and prior to July 1, 2002 that is eligible for amnesty under the Tax Delinquency Amnesty Act and the taxpayer fails to satisfy the tax liability during the amnesty period provided for in that Act for that taxable period, then the penalty imposed by the Department under this Section shall be imposed in an amount that is 200% of the amount that would otherwise be imposed under this Section.

(d) If a taxpayer has a tax liability for the taxable period ending after June 30, 2002 and prior to July 1, 2009 that is eligible for amnesty under the Tax Delinquency Amnesty Act, except for any tax liability reported pursuant to Section 506(b) of the Illinois Income Tax Act (35 ILCS 5/506(b)) that is not final, and the taxpayer fails to satisfy the tax liability during the amnesty period provided for in that Act for that taxable period, then the penalty imposed by the Department under this Section shall be imposed in an amount that is 200% of the amount that would otherwise be imposed under this Section.

(e) Notwithstanding any other provision of this Act, if a taxpayer files a return or an amended return based on a private letter ruling issued by the Department under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois, and it is later determined that the information provided by the taxpayer to the Department related to the issuance of that private letter ruling contained intentional misstatements of fact or omissions of fact capable of influencing the outcome of the Department's private letter ruling, the taxpayer shall be subject to the penalty imposed by subsection (a) of this Section.

(Source: P.A. 96-1435, eff. 8-16-10.)

(35 ILCS 735/3-8) (from Ch. 120, par. 2603-8)

Sec. 3-8. No penalties if reasonable cause exists. The penalties imposed under the provisions of Sections 3-3, 3-4, 3-5, and 3-7.5 of this Act shall not apply if the taxpayer shows that his failure to file a return or pay tax at the required time was due to reasonable cause. Reasonable cause shall be determined in each situation in accordance with the rules and regulations promulgated by the Department. A taxpayer may protest the imposition of a penalty under Section 3-3, 3-4, 3-5, or 3-7.5 on the basis of reasonable cause without protesting the underlying tax liability. If a taxpayer requests a private letter ruling under Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois, and the Department does not issue the private letter ruling, a letter that declines the request for private letter ruling, or a general information letter within 120 days of receipt of the request by the Department, or within an extended time period as provided under subsection (a) of Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois, then the taxpayer shall be deemed to have reasonable cause for any delinquency with regard to an issue that was the subject of its ruling request that occurs after the 120th day after the receipt of the request (or after the expiration of the extended time period as provided under subsection (a) of Section 2505-180 of the Department of Revenue Law of the Civil Administrative Code of Illinois, if applicable) and prior to the date the taxpayer receives the private letter ruling, a letter that declines the request for private letter ruling, or a general information letter. The person requesting the private letter ruling shall have no additional remedies against the Department for failing to issue or timely issue a requested private letter ruling.

(Source: P.A. 91-803, eff. 1-1-01.)".