103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB1901

 

Introduced 2/9/2023, by Sen. Chapin Rose

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 5/902  from Ch. 120, par. 9-902
35 ILCS 120/5j  from Ch. 120, par. 444j

    Amends the Illinois Income Tax Act and the Retailers' Occupation Tax Act. Eliminates the bulk sales notice requirement if the only asset sold or transferred is real estate. Effective immediately.


LRB103 25071 HLH 51406 b

 

 

A BILL FOR

 

SB1901LRB103 25071 HLH 51406 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 Illinois Income Tax Act is amended by
5changing Section 902 as follows:
 
6    (35 ILCS 5/902)  (from Ch. 120, par. 9-902)
7    Sec. 902. Notice and demand.
8    (a) In general. Except as provided in subsection (b) the
9Director shall, as soon as practicable after an amount payable
10under this Act is deemed assessed (as provided in Section
11903), give notice to each person liable for any unpaid portion
12of such assessment, stating the amount unpaid and demanding
13payment thereof. In the case of tax deemed assessed with the
14filing of a return, the Director shall give notice no later
15than 3 years after the date the return was filed. Upon receipt
16of any notice and demand there shall be paid at the place and
17time stated in such notice the amount stated in such notice.
18Such notice shall be left at the dwelling or usual place of
19business of such person or shall be sent by mail to the
20person's last known address.
21    (b) Judicial review. In the case of a deficiency deemed
22assessed under Section 903(a)(2) after the filing of a
23protest, notice and demand shall not be made with respect to

 

 

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1such assessment until all proceedings in court for the review
2of such assessment have terminated or the time for the taking
3thereof has expired without such proceedings being instituted.
4    (c) Action for recovery of taxes. At any time that the
5Department might commence proceedings for a levy under Section
61109, regardless of whether a notice of lien was filed under
7the provisions of Section 1103, it may bring an action in any
8court of competent jurisdiction within or without this State
9in the name of the people of this State to recover the amount
10of any taxes, penalties and interest due and unpaid under this
11Act. In such action, the certificate of the Department showing
12the amount of the delinquency shall be prima facie evidence of
13the correctness of such amount, its assessment and of the
14compliance by the Department with all the provisions of this
15Act.
16    (d) Sales or transfers outside the usual course of
17business-Report-Payment of Tax - Rights and duties of
18purchaser or transferee - penalty. If any taxpayer, outside
19the usual course of his business, sells or transfers the major
20part of any one or more of (A) the stock of goods which he is
21engaged in the business of selling, or (B) the furniture or
22fixtures, or (C) the machinery and equipment, or (D) the real
23property, of any business that is subject to the provisions of
24this Act, the purchaser or transferee of such assets shall, no
25later than 10 business days before the sale or transfer, file a
26notice of sale or transfer of business assets with the

 

 

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1Department disclosing the name and address of the seller or
2transferor, the name and address of the purchaser or
3transferee, the date of the sale or transfer, a copy of the
4sales contract and financing agreements which shall include a
5description of the property sold or transferred, the amount of
6the purchase price or a statement of other consideration for
7the sale or transfer, and the terms for payment of the purchase
8price, and such other information as the Department may
9reasonably require. The notice described in this subsection
10(d) is not required if the only asset sold or transferred is
11real estate. If the purchaser or transferee fails to file the
12above described notice of sale with the Department within the
13prescribed time, the purchaser or transferee shall be
14personally liable to the Department for the amount owed
15hereunder by the seller or transferor but unpaid, up to the
16amount of the reasonable value of the property acquired by the
17purchaser or transferee. The purchaser or transferee shall pay
18the Department the amount of tax, penalties, and interest owed
19by the seller or transferor under this Act, to the extent they
20have not been paid by the seller or transferor. The seller or
21transferor, or the purchaser or transferee, at least 10
22business days before the date of the sale or transfer, may
23notify the Department of the intended sale or transfer and
24request the Department to make a determination as to whether
25the seller or transferor owes any tax, penalty or interest due
26under this Act. The Department shall take such steps as may be

 

 

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1appropriate to comply with such request.
2    Any order issued by the Department pursuant to this
3Section to withhold from the purchase price shall be issued
4within 10 business days after the Department receives
5notification of a sale as provided in this Section. The
6purchaser or transferee shall withhold such portion of the
7purchase price as may be directed by the Department, but not to
8exceed a minimum amount varying by type of business, as
9determined by the Department pursuant to regulations, plus
10twice the outstanding unpaid liabilities and twice the average
11liability of preceding filings times the number of unfiled
12returns which were not filed when due, to cover the amount of
13all tax, penalty, and interest due and unpaid by the seller or
14transferor under this Act or, if the payment of money or
15property is not involved, shall withhold the performance of
16the condition that constitutes the consideration for the sale
17or transfer. Within 60 business days after issuance of the
18initial order to withhold, the Department shall provide
19written notice to the purchaser or transferee of the actual
20amount of all taxes, penalties and interest then due and
21whether or not additional amounts may become due as a result of
22unpaid taxes required to be withheld by an employer, returns
23which were not filed when due, pending assessments and audits
24not completed. The purchaser or transferee shall continue to
25withhold the amount directed to be withheld by the initial
26order or such lesser amount as is specified by the final

 

 

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1withholding order or to withhold the performance of the
2condition which constitutes the consideration for the sale or
3transfer until the purchaser or transferee receives from the
4Department a certificate showing that no unpaid tax, penalty
5or interest is due from the seller or transferor under this
6Act.
7    The purchaser or transferee is relieved of any duty to
8continue to withhold from the purchase price and of any
9liability for tax, penalty, or interest due hereunder from the
10seller or transferor if the Department fails to notify the
11purchaser or transferee in the manner provided herein of the
12amount to be withheld within 10 business days after the sale or
13transfer has been reported to the Department or within 60
14business days after issuance of the initial order to withhold,
15as the case may be. The Department shall have the right to
16determine amounts claimed on an estimated basis to allow for
17periods for which returns were not filed when due, pending
18assessments and audits not completed, however the purchaser or
19transferee shall be personally liable only for the actual
20amount due when determined.
21    If the seller or transferor has failed to pay the tax,
22penalty, and interest due from him hereunder and the
23Department makes timely claim therefor against the purchaser
24or transferee as hereinabove provided, then the purchaser or
25transferee shall pay to the Department the amount so withheld
26from the purchase price. If the purchaser or transferee fails

 

 

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1to comply with the requirements of this Section, the purchaser
2or transferee shall be personally liable to the Department for
3the amount owed hereunder by the seller or transferor up to the
4amount of the reasonable value of the property acquired by the
5purchaser or transferee.
6    Any person who shall acquire any property or rights
7thereto which, at the time of such acquisition, is subject to a
8valid lien in favor of the Department, shall be personally
9liable to the Department for a sum equal to the amount of
10taxes, penalties and interests, secured by such lien, but not
11to exceed the reasonable value of such property acquired by
12him.
13(Source: P.A. 102-40, eff. 6-25-21.)
 
14    Section 10. The Retailers' Occupation Tax Act is amended
15by changing Section 5j as follows:
 
16    (35 ILCS 120/5j)  (from Ch. 120, par. 444j)
17    Sec. 5j. If any taxpayer, outside the usual course of his
18business, sells or transfers the major part of any one or more
19of (A) the stock of goods which he is engaged in the business
20of selling, or (B) the furniture or fixtures, (C) the
21machinery and equipment, or (D) the real property, of any
22business that is subject to the provisions of this Act, the
23purchaser or transferee of such asset shall, no later than 10
24business days prior to the sale or transfer, file a notice of

 

 

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1sale or transfer of business assets with the Department
2disclosing the name and address of the seller or transferor,
3the name and address of the purchaser or transferee, the date
4of the sale or transfer, a copy of the sales contract and
5financing agreements which shall include a description of the
6property sold, the amount of the purchase price or a statement
7of other consideration for the sale or transfer, the terms for
8payment of the purchase price, and such other information as
9the Department may reasonably require. The notice described in
10this paragraph is not required if the only asset sold or
11transferred is real estate. If the purchaser or transferee
12fails to file the above described notice of sale with the
13Department within the prescribed time, the purchaser or
14transferee shall be personally liable for the amount owed
15hereunder by the seller or transferor to the Department up to
16the amount of the reasonable value of the property acquired by
17the purchaser or transferee. The seller or transferor shall
18pay the Department the amount of tax, penalty and interest (if
19any) due from him under this Act up to the date of the payment
20of tax. The seller or transferor, or the purchaser or
21transferee, at least 10 business days before the date of the
22sale or transfer, may notify the Department of the intended
23sale or transfer and request the Department to audit the books
24and records of the seller or transferor, or to do whatever else
25may be necessary to determine how much the seller or
26transferor owes to the Department hereunder up to the date of

 

 

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1the sale or transfer. The Department shall take such steps as
2may be appropriate to comply with such request.
3    Any order issued by the Department pursuant to this
4Section to withhold from the purchase price shall be issued
5within 10 business days after the Department receives
6notification of a sale as provided in this Section. The
7purchaser or transferee shall withhold such portion of the
8purchase price as may be directed by the Department, but not to
9exceed a minimum amount varying by type of business, as
10determined by the Department pursuant to regulations, plus
11twice the outstanding unpaid liabilities and twice the average
12liability of preceding filings times the number of unfiled
13returns, to cover the amount of all tax, penalty and interest
14due and unpaid by the seller or transferor under this Act or,
15if the payment of money or property is not involved, shall
16withhold the performance of the condition that constitutes the
17consideration for the sale or transfer. Within 60 business
18days after issuance of the initial order to withhold, the
19Department shall provide written notice to the purchaser or
20transferee of the actual amount of all taxes, penalties and
21interest then due and whether or not additional amounts may
22become due as a result of unfiled returns, pending assessments
23and audits not completed. The purchaser or transferee shall
24continue to withhold the amount directed to be withheld by the
25initial order or such lesser amount as is specified by the
26final withholding order or to withhold the performance of the

 

 

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1condition which constitutes the consideration for the sale or
2transfer until the purchaser or transferee receives from the
3Department a certificate showing that such tax, penalty and
4interest have been paid or a certificate from the Department
5showing that no tax, penalty or interest is due from the seller
6or transferor under this Act.
7    The purchaser or transferee is relieved of any duty to
8continue to withhold from the purchase price and of any
9liability for tax, penalty or interest due hereunder from the
10seller or transferor if the Department fails to notify the
11purchaser or transferee in the manner provided herein of the
12amount to be withheld within 10 business days after the sale or
13transfer has been reported to the Department or within 60
14business days after issuance of the initial order to withhold,
15as the case may be. The Department shall have the right to
16determine amounts claimed on an estimated basis to allow for
17non-filed periods, pending assessments and audits not
18completed, however the purchaser or transferee shall be
19personally liable only for the actual amount due when
20determined.
21    If the seller or transferor fails to pay the tax, penalty
22and interest (if any) due from him hereunder and the
23Department makes timely claim therefor against the purchaser
24or transferee as hereinabove provided, then the purchaser or
25transferee shall pay the amount so withheld from the purchase
26price to the Department. If the purchaser or transferee fails

 

 

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1to comply with the requirements of this Section, the purchaser
2or transferee shall be personally liable to the Department for
3the amount owed hereunder by the seller or transferor to the
4Department up to the amount of the reasonable value of the
5property acquired by the purchaser or transferee.
6    Any person who shall acquire any property or rights
7thereto which, at the time of such acquisition, is subject to a
8valid lien in favor of the Department shall be personally
9liable to the Department for a sum equal to the amount of taxes
10secured by such lien but not to exceed the reasonable value of
11such property acquired by him.
12(Source: P.A. 100-1171, eff. 1-4-19.)
 
13    Section 99. Effective date. This Act takes effect upon
14becoming law.