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1     AN ACT concerning revenue.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Illinois Income Tax Act is amended by
5 changing Section 704 and by adding Section 704A as follows:
 
6     (35 ILCS 5/704)  (from Ch. 120, par. 7-704)
7     Sec. 704. Employer's Return and Payment of Tax Withheld.
8     (a) In general, every employer who deducts and withholds or
9 is required to deduct and withhold tax under this Act prior to
10 January 1, 2008, shall make such payments and returns as
11 hereinafter provided in this Section.
12     (b) Quarter Monthly Payments: Returns. Every employer who
13 deducts and withholds or is required to deduct and withhold tax
14 under this Act shall, on or before the third banking day
15 following the close of a quarter monthly period, pay to the
16 Department or to a depositary designated by the Department,
17 pursuant to regulations prescribed by the Department, the taxes
18 so required to be deducted and withheld, whenever the aggregate
19 amount withheld by such employer (together with amounts
20 previously withheld and not paid to the Department) exceeds
21 $1,000. For purposes of this Section, Saturdays, Sundays, legal
22 holidays and local bank holidays are not banking days. A
23 quarter monthly period, for purposes of this subsection, ends

 

 

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1 on the 7th, 15th, 22nd and last day of each calendar month.
2 Every such employer shall for each calendar quarter, on or
3 before the last day of the first month following the close of
4 such quarter, and for the calendar year, on or before January
5 31 of the succeeding calendar year, make a return with respect
6 to such taxes in such form and manner as the Department may by
7 regulations prescribe, and pay to the Department or to a
8 depositary designated by the Department all withheld taxes not
9 previously paid to the Department.
10     (c) Monthly Payments: Returns. Every employer required to
11 deduct and withhold tax under this Act shall, on or before the
12 15th day of the second and third months of each calendar
13 quarter, and on or before the last day of the month following
14 the last month of each such quarter, pay to the Department or
15 to a depositary designated by the Department, pursuant to
16 regulations prescribed by the Department, the taxes so required
17 to be deducted and withheld, whenever the aggregate amount
18 withheld by such employer (together with amounts previously
19 withheld and not paid to the Department) exceeds $500 but does
20 not exceed $1,000. Every such employer shall for each calendar
21 quarter, on or before the last day of the first month following
22 the close of such quarter, and for the calendar year, on or
23 before January 31 of the succeeding calendar year, make a
24 return with respect to such taxes in such form and manner as
25 the Department may by regulations prescribe, and pay to the
26 Department or to a depositary designated by the Department all

 

 

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1 withheld taxes not previously paid to the Department.
2     (d) Annual Payments: Returns. Where the amount of
3 compensation paid by an employer is not sufficient to require
4 the withholding of tax from the compensation of any of its
5 employees (or where the aggregate amount withheld is less than
6 $500), the Department may by regulation permit such employer to
7 file only an annual return and to pay the taxes required to be
8 deducted and withheld at the time of filing such annual return.
9     (e) Annual Return. The Department may, as it deems
10 appropriate, prescribe by regulation for the filing of annual
11 returns in lieu of quarterly returns described in subsections
12 (b) and (c).
13     (e-5) Annual Return and Payment. On and after January 1,
14 1998, notwithstanding subsections (b) through (d) of this
15 Section, every employer who deducts and withholds or is
16 required to deduct and withhold tax from a person engaged in
17 domestic service employment, as that term is defined in Section
18 3510 of the Internal Revenue Code, may comply with the
19 requirements of this Section by filing an annual return and
20 paying the taxes required to be deducted and withheld on or
21 before the 15th day of the fourth month following the close of
22 the employer's taxable year. The annual return may be submitted
23 with the employer's individual income tax return.
24     (f) Magnetic Media Filing. Forms W-2 that, pursuant to the
25 Internal Revenue Code and regulations promulgated thereunder,
26 are required to be submitted to the Internal Revenue Service on

 

 

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1 magnetic media, must also be submitted to the Department on
2 magnetic media for Illinois purposes, if required by the
3 Department.
4 (Source: P.A. 90-374, eff. 8-14-97; 90-562, eff. 12-16-97.)
 
5     (35 ILCS 5/704A new)
6     Sec. 704A. Employer's return and payment of tax withheld.
7     (a) In general, every employer who deducts and withholds or
8 is required to deduct and withhold tax under this Act on or
9 after January 1, 2008 shall make those payments and returns as
10 provided in this Section.
11     (b) Returns. Every employer shall, in the form and manner
12 required by the Department, make returns with respect to taxes
13 withheld or required to be withheld under this Article 7
14 beginning on or after January 1, 2008, on or before the last
15 day of the first month following the close of that quarter.
16     (c) Payments. With respect to amounts withheld or required
17 to be withheld on or after January 1, 2008:
18         (1) Semi-weekly payments. For each calendar year, each
19     employer who withheld or was required to withhold more than
20     $12,000 during the one-year period ending on June 30 of the
21     immediately preceding calendar year, payment must be made:
22             (A) on or before each Friday of the calendar year,
23         for taxes withheld or required to be withheld on the
24         immediately preceding Saturday, Sunday, Monday, or
25         Tuesday;

 

 

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1             (B) on or before each Wednesday of the calendar
2         year, for taxes withheld or required to be withheld on
3         the immediately preceding Wednesday, Thursday, or
4         Friday.
5         (2) Semi-weekly payments. Any employer who withholds
6     or is required to withhold more than $12,000 in any quarter
7     of a calendar year is required to make payments on the
8     dates set forth under item (1) of this subsection (c) for
9     each remaining quarter of that calendar year and for the
10     subsequent calendar year.
11         (3) Monthly payments. Each employer, other than an
12     employer described in items (1) or (2) of this subsection,
13     shall pay to the Department, on or before the 15th day of
14     each month the taxes withheld or required to be withheld
15     during the immediately preceding month.
16         (4) Payments with returns. Each employer shall pay to
17     the Department, on or before the due date for each return
18     required to be filed under this Section, any tax withheld
19     or required to be withheld during the period for which the
20     return is due and not previously paid to the Department.
21     (d) Regulatory authority. The Department may, by rule:
22         (1) If the aggregate amounts required to be withheld
23     under this Article 7 do not exceed $1,000 for the calendar
24     year, permit employers, in lieu of the requirements of
25     subsections (b) and (c), to file annual returns due on or
26     before January 31 of the following year for taxes withheld

 

 

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1     or required to be withheld during that calendar year and to
2     pay the taxes required to be shown on each such return no
3     later than the due date for such return.
4         (2) Provide that any payment required to be made under
5     subsection (c)(1) or (c)(2) is deemed to be timely to the
6     extent paid by electronic funds transfer on or before the
7     due date for deposit of federal income taxes withheld from,
8     or federal employment taxes due with respect to, the wages
9     from which the Illinois taxes were withheld.
10         (3) Designate one or more depositories to which payment
11     of taxes required to be withheld under this Article 7 must
12     be paid by some or all employers.
13         (4) Increase the threshold dollar amounts at which
14     employers are required to make semi-weekly payments under
15     subsection (c)(1) or (c)(2).
16     (e) Annual return and payment. Every employer who deducts
17 and withholds or is required to deduct and withhold tax from a
18 person engaged in domestic service employment, as that term is
19 defined in Section 3510 of the Internal Revenue Code, may
20 comply with the requirements of this Section with respect to
21 such employees by filing an annual return and paying the taxes
22 required to be deducted and withheld on or before the 15th day
23 of the fourth month following the close of the employer's
24 taxable year. The Department may allow the employer's return to
25 be submitted with the employer's individual income tax return
26 or to be submitted with a return due from the employer under

 

 

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1 Section 1400.2 of the Unemployment Insurance Act.
2     (f) Magnetic media and electronic filing. Any W-2 Form
3 that, under the Internal Revenue Code and regulations
4 promulgated thereunder, is required to be submitted to the
5 Internal Revenue Service on magnetic media or electronically
6 must also be submitted to the Department on magnetic media or
7 electronically for Illinois purposes, if required by the
8 Department.
 
9     Section 10. The Illinois Municipal Code is amended by
10 changing Section 8-11-1.1 as follows:
 
11     (65 ILCS 5/8-11-1.1)  (from Ch. 24, par. 8-11-1.1)
12     Sec. 8-11-1.1. Non-home rule municipalities; imposition of
13 taxes.
14     (a) The corporate authorities of a non-home rule
15 municipality may, upon approval of the electors of the
16 municipality pursuant to subsection (b) of this Section, impose
17 by ordinance or resolution the tax authorized in Sections
18 8-11-1.3, 8-11-1.4 and 8-11-1.5 of this Act.
19     (b) The corporate authorities of the municipality may by
20 ordinance or resolution call for the submission to the electors
21 of the municipality the question of whether the municipality
22 shall impose such tax. Such question shall be certified by the
23 municipal clerk to the election authority in accordance with
24 Section 28-5 of the Election Code and shall be in a form in

 

 

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1 accordance with Section 16-7 of the Election Code.
2     If a majority of the electors in the municipality voting
3 upon the question vote in the affirmative, such tax shall be
4 imposed.
5     An ordinance or resolution imposing the tax of not more
6 than 1% hereunder or discontinuing the same shall be adopted
7 and a certified copy thereof, together with a certification
8 that the ordinance or resolution received referendum approval
9 in the case of the imposition of such tax, filed with the
10 Department of Revenue, on or before the first day of June,
11 whereupon the Department shall proceed to administer and
12 enforce the additional tax or to discontinue the tax, as the
13 case may be, as of the first day of September next following
14 such adoption and filing. Beginning January 1, 1992, an
15 ordinance or resolution imposing or discontinuing the tax
16 hereunder shall be adopted and a certified copy thereof filed
17 with the Department on or before the first day of July,
18 whereupon the Department shall proceed to administer and
19 enforce this Section as of the first day of October next
20 following such adoption and filing. Beginning January 1, 1993,
21 an ordinance or resolution imposing or discontinuing the tax
22 hereunder shall be adopted and a certified copy thereof filed
23 with the Department on or before the first day of October,
24 whereupon the Department shall proceed to administer and
25 enforce this Section as of the first day of January next
26 following such adoption and filing. Beginning October 1, 2002,

 

 

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1 an ordinance or resolution imposing or discontinuing the tax
2 under this Section or effecting a change in the rate of tax
3 must either (i) be adopted and a certified copy of the
4 ordinance or resolution filed with the Department on or before
5 the first day of April, whereupon the Department shall proceed
6 to administer and enforce this Section as of the first day of
7 July next following the adoption and filing; or (ii) be adopted
8 and a certified copy of the ordinance or resolution filed with
9 the Department on or before the first day of October, whereupon
10 the Department shall proceed to administer and enforce this
11 Section as of the first day of January next following the
12 adoption and filing.
13     Notwithstanding any provision in this Section to the
14 contrary, if, in a non-home rule municipality with more than
15 150,000 but fewer than 200,000 inhabitants, as determined by
16 the last preceding federal decennial census, an ordinance or
17 resolution under this Section imposes or discontinues a tax or
18 changes the tax rate as of July 1, 2007, then that ordinance or
19 resolution, together with a certification that the ordinance or
20 resolution received referendum approval in the case of the
21 imposition of the tax, must be adopted and a certified copy of
22 that ordinance or resolution must be filed with the Department
23 on or before May 15, 2007, whereupon the Department shall
24 proceed to administer and enforce this Section as of July 1,
25 2007.
26     A non-home rule municipality may file a certified copy of

 

 

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1 an ordinance or resolution, with a certification that the
2 ordinance or resolution received referendum approval in the
3 case of the imposition of the tax, with the Department of
4 Revenue, as required under this Section, only after October 2,
5 2000.
6     The tax authorized by this Section may not be more than 1%
7 and may be imposed only in 1/4% increments.
8 (Source: P.A. 94-679, eff. 1-1-06.)
 
9     Section 99. Effective date. This Act takes effect upon
10 becoming law.