103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB2579

 

Introduced 2/15/2023, by Rep. Joe C. Sosnowski

 

SYNOPSIS AS INTRODUCED:
 
20 ILCS 2505/2505-380  was 20 ILCS 2505/39b47
35 ILCS 120/2a  from Ch. 120, par. 441a

    Amends the Department of Revenue Law of the Civil Administrative Code of Illinois and the Retailers' Occupation Tax Act. Provides that the Department of Revenue may deny a certificate of registration to an applicant or refuse to issue, reissue, or renew a certificate of registration, permit, or license authorized to be issued by the Department of Revenue if certain owners, partners, officers, managers, or members of the applicant fail to file a return, on or before the due date prescribed for filing that return, that the person is required to file under any tax or fee Act administered by the Department of Revenue.


LRB103 00132 HLH 45136 b

 

 

A BILL FOR

 

HB2579LRB103 00132 HLH 45136 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Department of Revenue Law of the Civil
5Administrative Code of Illinois is amended by changing Section
62505-380 as follows:
 
7    (20 ILCS 2505/2505-380)  (was 20 ILCS 2505/39b47)
8    Sec. 2505-380. Revocation of or refusal to issue or
9reissue a certificate of registration, permit, or license.
10    (a) The Department has the power, after notice and an
11opportunity for a hearing, to revoke a certificate of
12registration, permit, or license issued by the Department if
13the holder of the certificate of registration, permit, or
14license fails to file a return, or to pay the tax, fee,
15penalty, or interest shown in a filed return, or to pay any
16final assessment of tax, fee, penalty, or interest, as
17required by the tax or fee Act under which the certificate of
18registration, permit, or license is required or any other tax
19or fee Act administered by the Department.
20    (b) The Department may refuse to issue, reissue, or renew
21a certificate of registration, permit, or license authorized
22to be issued by the Department if a person who is named as the
23owner, a partner, a corporate officer, or, in the case of a

 

 

HB2579- 2 -LRB103 00132 HLH 45136 b

1limited liability company, a manager or member, of the
2applicant on the application for the certificate of
3registration, permit or license, is or has been named as the
4owner, a partner, a corporate officer, or in the case of a
5limited liability company, a manager or member, on the
6application for the certificate of registration, permit, or
7license of a person that (i) is in default for moneys due under
8the tax or fee Act upon which the certificate of registration,
9permit, or license is required or any other tax or fee Act
10administered by the Department or (ii) fails to file any
11return, on or before the due date prescribed for filing that
12return (including any extensions of time granted by the
13Department), that the person is required to file under the tax
14or fee Act upon which the certificate of registration, permit,
15or license is required or any other tax or fee Act administered
16by the Department. For purposes of this Section only, in
17determining whether a person is in default for moneys due, the
18Department shall include only amounts established as a final
19liability within the 23 years prior to the date of the
20Department's notice of refusal to issue or reissue the
21certificate of registration, permit, or license. For purposes
22of this Section, "person" means any natural individual, firm,
23partnership, association, joint stock company, joint
24adventure, public or private corporation, limited liability
25company, or a receiver, executor, trustee, guardian or other
26representative appointed by order of any court.

 

 

HB2579- 3 -LRB103 00132 HLH 45136 b

1    (c) When revoking or refusing to issue or reissue a
2certificate of registration, permit, or license issued by the
3Department, the procedure for notice and hearing used shall be
4the procedure provided under the Act pursuant to which the
5certificate of registration, permit, or license was issued.
6(Source: P.A. 102-40, eff. 6-25-21.)
 
7    Section 10. The Retailers' Occupation Tax Act is amended
8by changing Section 2a as follows:
 
9    (35 ILCS 120/2a)  (from Ch. 120, par. 441a)
10    Sec. 2a. It is unlawful for any person to engage in the
11business of selling tangible personal property at retail in
12this State without a certificate of registration from the
13Department. Application for a certificate of registration
14shall be made to the Department upon forms furnished by it.
15Each such application shall be signed and verified and shall
16state: (1) the name and social security number of the
17applicant; (2) the address of his principal place of business;
18(3) the address of the principal place of business from which
19he engages in the business of selling tangible personal
20property at retail in this State and the addresses of all other
21places of business, if any (enumerating such addresses, if
22any, in a separate list attached to and made a part of the
23application), from which he engages in the business of selling
24tangible personal property at retail in this State; (4) the

 

 

HB2579- 4 -LRB103 00132 HLH 45136 b

1name and address of the person or persons who will be
2responsible for filing returns and payment of taxes due under
3this Act; (5) in the case of a publicly traded corporation, the
4name and title of the Chief Financial Officer, Chief Operating
5Officer, and any other officer or employee with responsibility
6for preparing tax returns under this Act, and, in the case of
7all other corporations, the name, title, and social security
8number of each corporate officer; (6) in the case of a limited
9liability company, the name, social security number, and FEIN
10number of each manager and member; and (7) such other
11information as the Department may reasonably require. The
12application shall contain an acceptance of responsibility
13signed by the person or persons who will be responsible for
14filing returns and payment of the taxes due under this Act. If
15the applicant will sell tangible personal property at retail
16through vending machines, his application to register shall
17indicate the number of vending machines to be so operated. If
18requested by the Department at any time, that person shall
19verify the total number of vending machines he or she uses in
20his or her business of selling tangible personal property at
21retail.
22    The Department shall provide by rule for an expedited
23business registration process for remote retailers required to
24register and file under subsection (b) of Section 2 who use a
25certified service provider to file their returns under this
26Act. Such expedited registration process shall allow the

 

 

HB2579- 5 -LRB103 00132 HLH 45136 b

1Department to register a taxpayer based upon the same
2registration information required by the Streamlined Sales Tax
3Governing Board for states participating in the Streamlined
4Sales Tax Project.
5    The Department may deny a certificate of registration to
6any applicant if a person who is named as the owner, a partner,
7a manager or member of a limited liability company, or a
8corporate officer of the applicant on the application for the
9certificate of registration is or has been named as the owner,
10a partner, a manager or member of a limited liability company,
11or a corporate officer on the application for the certificate
12of registration of another retailer that (i) is in default for
13moneys due under this Act or any other tax or fee Act
14administered by the Department or (ii) fails to file any
15return, on or before the due date prescribed for filing that
16return (including any extensions of time granted by the
17Department), that the retailer is required to file under this
18Act or any other tax or fee Act administered by the Department.
19For purposes of this paragraph only, in determining whether a
20person is in default for moneys due, the Department shall
21include only amounts established as a final liability within
22the 23 years prior to the date of the Department's notice of
23denial of a certificate of registration.
24    The Department may require an applicant for a certificate
25of registration hereunder to, at the time of filing such
26application, furnish a bond from a surety company authorized

 

 

HB2579- 6 -LRB103 00132 HLH 45136 b

1to do business in the State of Illinois, or an irrevocable bank
2letter of credit or a bond signed by 2 personal sureties who
3have filed, with the Department, sworn statements disclosing
4net assets equal to at least 3 times the amount of the bond to
5be required of such applicant, or a bond secured by an
6assignment of a bank account or certificate of deposit, stocks
7or bonds, conditioned upon the applicant paying to the State
8of Illinois all moneys becoming due under this Act and under
9any other State tax law or municipal or county tax ordinance or
10resolution under which the certificate of registration that is
11issued to the applicant under this Act will permit the
12applicant to engage in business without registering separately
13under such other law, ordinance or resolution. In making a
14determination as to whether to require a bond or other
15security, the Department shall take into consideration whether
16the owner, any partner, any manager or member of a limited
17liability company, or a corporate officer of the applicant is
18or has been the owner, a partner, a manager or member of a
19limited liability company, or a corporate officer of another
20retailer that is in default for moneys due under this Act or
21any other tax or fee Act administered by the Department; and
22whether the owner, any partner, any manager or member of a
23limited liability company, or a corporate officer of the
24applicant is or has been the owner, a partner, a manager or
25member of a limited liability company, or a corporate officer
26of another retailer whose certificate of registration has been

 

 

HB2579- 7 -LRB103 00132 HLH 45136 b

1revoked within the previous 5 years under this Act or any other
2tax or fee Act administered by the Department. If a bond or
3other security is required, the Department shall fix the
4amount of the bond or other security, taking into
5consideration the amount of money expected to become due from
6the applicant under this Act and under any other State tax law
7or municipal or county tax ordinance or resolution under which
8the certificate of registration that is issued to the
9applicant under this Act will permit the applicant to engage
10in business without registering separately under such other
11law, ordinance, or resolution. The amount of security required
12by the Department shall be such as, in its opinion, will
13protect the State of Illinois against failure to pay the
14amount which may become due from the applicant under this Act
15and under any other State tax law or municipal or county tax
16ordinance or resolution under which the certificate of
17registration that is issued to the applicant under this Act
18will permit the applicant to engage in business without
19registering separately under such other law, ordinance or
20resolution, but the amount of the security required by the
21Department shall not exceed three times the amount of the
22applicant's average monthly tax liability, or $50,000.00,
23whichever amount is lower.
24    No certificate of registration under this Act shall be
25issued by the Department until the applicant provides the
26Department with satisfactory security, if required, as herein

 

 

HB2579- 8 -LRB103 00132 HLH 45136 b

1provided for.
2    Upon receipt of the application for certificate of
3registration in proper form, and upon approval by the
4Department of the security furnished by the applicant, if
5required, the Department shall issue to such applicant a
6certificate of registration which shall permit the person to
7whom it is issued to engage in the business of selling tangible
8personal property at retail in this State. The certificate of
9registration shall be conspicuously displayed at the place of
10business which the person so registered states in his
11application to be the principal place of business from which
12he engages in the business of selling tangible personal
13property at retail in this State.
14    No certificate of registration issued prior to July 1,
152017 to a taxpayer who files returns required by this Act on a
16monthly basis or renewed prior to July 1, 2017 by a taxpayer
17who files returns required by this Act on a monthly basis shall
18be valid after the expiration of 5 years from the date of its
19issuance or last renewal. No certificate of registration
20issued on or after July 1, 2017 to a taxpayer who files returns
21required by this Act on a monthly basis or renewed on or after
22July 1, 2017 by a taxpayer who files returns required by this
23Act on a monthly basis shall be valid after the expiration of
24one year from the date of its issuance or last renewal. The
25expiration date of a sub-certificate of registration shall be
26that of the certificate of registration to which the

 

 

HB2579- 9 -LRB103 00132 HLH 45136 b

1sub-certificate relates. Prior to July 1, 2017, a certificate
2of registration shall automatically be renewed, subject to
3revocation as provided by this Act, for an additional 5 years
4from the date of its expiration unless otherwise notified by
5the Department as provided by this paragraph. On and after
6July 1, 2017, a certificate of registration shall
7automatically be renewed, subject to revocation as provided by
8this Act, for an additional one year from the date of its
9expiration unless otherwise notified by the Department as
10provided by this paragraph.
11    Where a taxpayer to whom a certificate of registration is
12issued under this Act is in default to the State of Illinois
13for delinquent returns or for moneys due under this Act or any
14other State tax law or municipal or county ordinance
15administered or enforced by the Department, the Department
16shall, not less than 60 days before the expiration date of such
17certificate of registration, give notice to the taxpayer to
18whom the certificate was issued of the account period of the
19delinquent returns, the amount of tax, penalty and interest
20due and owing from the taxpayer, and that the certificate of
21registration shall not be automatically renewed upon its
22expiration date unless the taxpayer, on or before the date of
23expiration, has filed and paid the delinquent returns or paid
24the defaulted amount in full. A taxpayer to whom such a notice
25is issued shall be deemed an applicant for renewal. The
26Department shall promulgate regulations establishing

 

 

HB2579- 10 -LRB103 00132 HLH 45136 b

1procedures for taxpayers who file returns on a monthly basis
2but desire and qualify to change to a quarterly or yearly
3filing basis and will no longer be subject to renewal under
4this Section, and for taxpayers who file returns on a yearly or
5quarterly basis but who desire or are required to change to a
6monthly filing basis and will be subject to renewal under this
7Section.
8    The Department may in its discretion approve renewal by an
9applicant who is in default if, at the time of application for
10renewal, the applicant files all of the delinquent returns or
11pays to the Department such percentage of the defaulted amount
12as may be determined by the Department and agrees in writing to
13waive all limitations upon the Department for collection of
14the remaining defaulted amount to the Department over a period
15not to exceed 5 years from the date of renewal of the
16certificate; however, no renewal application submitted by an
17applicant who is in default shall be approved if the
18immediately preceding renewal by the applicant was conditioned
19upon the installment payment agreement described in this
20Section. The payment agreement herein provided for shall be in
21addition to and not in lieu of the security that may be
22required by this Section of a taxpayer who is no longer
23considered a prior continuous compliance taxpayer. The
24execution of the payment agreement as provided in this Act
25shall not toll the accrual of interest at the statutory rate.
26    The Department may suspend a certificate of registration

 

 

HB2579- 11 -LRB103 00132 HLH 45136 b

1if the Department finds that the person to whom the
2certificate of registration has been issued knowingly sold
3contraband cigarettes.
4    A certificate of registration issued under this Act more
5than 5 years before January 1, 1990 (the effective date of
6Public Act 86-383) shall expire and be subject to the renewal
7provisions of this Section on the next anniversary of the date
8of issuance of such certificate which occurs more than 6
9months after January 1, 1990 (the effective date of Public Act
1086-383). A certificate of registration issued less than 5
11years before January 1, 1990 (the effective date of Public Act
1286-383) shall expire and be subject to the renewal provisions
13of this Section on the 5th anniversary of the issuance of the
14certificate.
15    If the person so registered states that he operates other
16places of business from which he engages in the business of
17selling tangible personal property at retail in this State,
18the Department shall furnish him with a sub-certificate of
19registration for each such place of business, and the
20applicant shall display the appropriate sub-certificate of
21registration at each such place of business. All
22sub-certificates of registration shall bear the same
23registration number as that appearing upon the certificate of
24registration to which such sub-certificates relate.
25    If the applicant will sell tangible personal property at
26retail through vending machines, the Department shall furnish

 

 

HB2579- 12 -LRB103 00132 HLH 45136 b

1him with a sub-certificate of registration for each such
2vending machine, and the applicant shall display the
3appropriate sub-certificate of registration on each such
4vending machine by attaching the sub-certificate of
5registration to a conspicuous part of such vending machine. If
6a person who is registered to sell tangible personal property
7at retail through vending machines adds an additional vending
8machine or additional vending machines to the number of
9vending machines he or she uses in his or her business of
10selling tangible personal property at retail, he or she shall
11notify the Department, on a form prescribed by the Department,
12to request an additional sub-certificate or additional
13sub-certificates of registration, as applicable. With each
14such request, the applicant shall report the number of
15sub-certificates of registration he or she is requesting as
16well as the total number of vending machines from which he or
17she makes retail sales.
18    Where the same person engages in 2 or more businesses of
19selling tangible personal property at retail in this State,
20which businesses are substantially different in character or
21engaged in under different trade names or engaged in under
22other substantially dissimilar circumstances (so that it is
23more practicable, from an accounting, auditing or bookkeeping
24standpoint, for such businesses to be separately registered),
25the Department may require or permit such person (subject to
26the same requirements concerning the furnishing of security as

 

 

HB2579- 13 -LRB103 00132 HLH 45136 b

1those that are provided for hereinbefore in this Section as to
2each application for a certificate of registration) to apply
3for and obtain a separate certificate of registration for each
4such business or for any of such businesses, under a single
5certificate of registration supplemented by related
6sub-certificates of registration.
7    Any person who is registered under the Retailers'
8Occupation Tax Act as of March 8, 1963, and who, during the
93-year period immediately prior to March 8, 1963, or during a
10continuous 3-year period part of which passed immediately
11before and the remainder of which passes immediately after
12March 8, 1963, has been so registered continuously and who is
13determined by the Department not to have been either
14delinquent or deficient in the payment of tax liability during
15that period under this Act or under any other State tax law or
16municipal or county tax ordinance or resolution under which
17the certificate of registration that is issued to the
18registrant under this Act will permit the registrant to engage
19in business without registering separately under such other
20law, ordinance or resolution, shall be considered to be a
21Prior Continuous Compliance taxpayer. Also any taxpayer who
22has, as verified by the Department, faithfully and
23continuously complied with the condition of his bond or other
24security under the provisions of this Act for a period of 3
25consecutive years shall be considered to be a Prior Continuous
26Compliance taxpayer.

 

 

HB2579- 14 -LRB103 00132 HLH 45136 b

1    Every Prior Continuous Compliance taxpayer shall be exempt
2from all requirements under this Act concerning the furnishing
3of a bond or other security as a condition precedent to his
4being authorized to engage in the business of selling tangible
5personal property at retail in this State. This exemption
6shall continue for each such taxpayer until such time as he may
7be determined by the Department to be delinquent in the filing
8of any returns, or is determined by the Department (either
9through the Department's issuance of a final assessment which
10has become final under the Act, or by the taxpayer's filing of
11a return which admits tax that is not paid to be due) to be
12delinquent or deficient in the paying of any tax under this Act
13or under any other State tax law or municipal or county tax
14ordinance or resolution under which the certificate of
15registration that is issued to the registrant under this Act
16will permit the registrant to engage in business without
17registering separately under such other law, ordinance or
18resolution, at which time that taxpayer shall become subject
19to all the financial responsibility requirements of this Act
20and, as a condition of being allowed to continue to engage in
21the business of selling tangible personal property at retail,
22may be required to post bond or other acceptable security with
23the Department covering liability which such taxpayer may
24thereafter incur. Any taxpayer who fails to pay an admitted or
25established liability under this Act may also be required to
26post bond or other acceptable security with this Department

 

 

HB2579- 15 -LRB103 00132 HLH 45136 b

1guaranteeing the payment of such admitted or established
2liability.
3    No certificate of registration shall be issued to any
4person who is in default to the State of Illinois for moneys
5due under this Act or under any other State tax law or
6municipal or county tax ordinance or resolution under which
7the certificate of registration that is issued to the
8applicant under this Act will permit the applicant to engage
9in business without registering separately under such other
10law, ordinance or resolution.
11    Any person aggrieved by any decision of the Department
12under this Section may, within 20 days after notice of such
13decision, protest and request a hearing, whereupon the
14Department shall give notice to such person of the time and
15place fixed for such hearing and shall hold a hearing in
16conformity with the provisions of this Act and then issue its
17final administrative decision in the matter to such person. In
18the absence of such a protest within 20 days, the Department's
19decision shall become final without any further determination
20being made or notice given.
21    With respect to security other than bonds (upon which the
22Department may sue in the event of a forfeiture), if the
23taxpayer fails to pay, when due, any amount whose payment such
24security guarantees, the Department shall, after such
25liability is admitted by the taxpayer or established by the
26Department through the issuance of a final assessment that has

 

 

HB2579- 16 -LRB103 00132 HLH 45136 b

1become final under the law, convert the security which that
2taxpayer has furnished into money for the State, after first
3giving the taxpayer at least 10 days' written notice, by
4registered or certified mail, to pay the liability or forfeit
5such security to the Department. If the security consists of
6stocks or bonds or other securities which are listed on a
7public exchange, the Department shall sell such securities
8through such public exchange. If the security consists of an
9irrevocable bank letter of credit, the Department shall
10convert the security in the manner provided for in the Uniform
11Commercial Code. If the security consists of a bank
12certificate of deposit, the Department shall convert the
13security into money by demanding and collecting the amount of
14such bank certificate of deposit from the bank which issued
15such certificate. If the security consists of a type of stocks
16or other securities which are not listed on a public exchange,
17the Department shall sell such security to the highest and
18best bidder after giving at least 10 days' notice of the date,
19time and place of the intended sale by publication in the
20"State Official Newspaper". If the Department realizes more
21than the amount of such liability from the security, plus the
22expenses incurred by the Department in converting the security
23into money, the Department shall pay such excess to the
24taxpayer who furnished such security, and the balance shall be
25paid into the State Treasury.
26    The Department shall discharge any surety and shall

 

 

HB2579- 17 -LRB103 00132 HLH 45136 b

1release and return any security deposited, assigned, pledged
2or otherwise provided to it by a taxpayer under this Section
3within 30 days after:
4        (1) such taxpayer becomes a Prior Continuous
5    Compliance taxpayer; or
6        (2) such taxpayer has ceased to collect receipts on
7    which he is required to remit tax to the Department, has
8    filed a final tax return, and has paid to the Department an
9    amount sufficient to discharge his remaining tax
10    liability, as determined by the Department, under this Act
11    and under every other State tax law or municipal or county
12    tax ordinance or resolution under which the certificate of
13    registration issued under this Act permits the registrant
14    to engage in business without registering separately under
15    such other law, ordinance or resolution. The Department
16    shall make a final determination of the taxpayer's
17    outstanding tax liability as expeditiously as possible
18    after his final tax return has been filed; if the
19    Department cannot make such final determination within 45
20    days after receiving the final tax return, within such
21    period it shall so notify the taxpayer, stating its
22    reasons therefor.
23(Source: P.A. 101-31, eff. 6-28-19; 102-40, eff. 6-25-21.)