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91_HB4431
LRB9110442SMdvB
1 AN ACT concerning taxes, amending named Acts.
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 Sections 201, 203, 405, 803, and 1501 as follows:
6 (35 ILCS 5/201) (from Ch. 120, par. 2-201)
7 Sec. 201. Tax Imposed.
8 (a) In general. A tax measured by net income is hereby
9 imposed on every individual, corporation, trust and estate
10 for each taxable year ending after July 31, 1969 on the
11 privilege of earning or receiving income in or as a resident
12 of this State. Such tax shall be in addition to all other
13 occupation or privilege taxes imposed by this State or by any
14 municipal corporation or political subdivision thereof.
15 (b) Rates. The tax imposed by subsection (a) of this
16 Section shall be determined as follows, except as adjusted by
17 subsection (d-1):
18 (1) In the case of an individual, trust or estate,
19 for taxable years ending prior to July 1, 1989, an amount
20 equal to 2 1/2% of the taxpayer's net income for the
21 taxable year.
22 (2) In the case of an individual, trust or estate,
23 for taxable years beginning prior to July 1, 1989 and
24 ending after June 30, 1989, an amount equal to the sum of
25 (i) 2 1/2% of the taxpayer's net income for the period
26 prior to July 1, 1989, as calculated under Section 202.3,
27 and (ii) 3% of the taxpayer's net income for the period
28 after June 30, 1989, as calculated under Section 202.3.
29 (3) In the case of an individual, trust or estate,
30 for taxable years beginning after June 30, 1989, an
31 amount equal to 3% of the taxpayer's net income for the
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1 taxable year.
2 (4) (Blank).
3 (5) (Blank).
4 (6) In the case of a corporation, for taxable years
5 ending prior to July 1, 1989, an amount equal to 4% of
6 the taxpayer's net income for the taxable year.
7 (7) In the case of a corporation, for taxable years
8 beginning prior to July 1, 1989 and ending after June 30,
9 1989, an amount equal to the sum of (i) 4% of the
10 taxpayer's net income for the period prior to July 1,
11 1989, as calculated under Section 202.3, and (ii) 4.8% of
12 the taxpayer's net income for the period after June 30,
13 1989, as calculated under Section 202.3.
14 (8) In the case of a corporation, for taxable years
15 beginning after June 30, 1989, an amount equal to 4.8% of
16 the taxpayer's net income for the taxable year.
17 (c) Beginning on July 1, 1979 and thereafter, in
18 addition to such income tax, there is also hereby imposed the
19 Personal Property Tax Replacement Income Tax measured by net
20 income on every corporation (including Subchapter S
21 corporations), partnership and trust, for each taxable year
22 ending after June 30, 1979. Such taxes are imposed on the
23 privilege of earning or receiving income in or as a resident
24 of this State. The Personal Property Tax Replacement Income
25 Tax shall be in addition to the income tax imposed by
26 subsections (a) and (b) of this Section and in addition to
27 all other occupation or privilege taxes imposed by this State
28 or by any municipal corporation or political subdivision
29 thereof.
30 (d) Additional Personal Property Tax Replacement Income
31 Tax Rates. The personal property tax replacement income tax
32 imposed by this subsection and subsection (c) of this Section
33 in the case of a corporation, other than a Subchapter S
34 corporation and except as adjusted by subsection (d-1), shall
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1 be an additional amount equal to 2.85% of such taxpayer's net
2 income for the taxable year, except that beginning on January
3 1, 1981, and thereafter, the rate of 2.85% specified in this
4 subsection shall be reduced to 2.5%, and in the case of a
5 partnership, trust or a Subchapter S corporation shall be an
6 additional amount equal to 1.5% of such taxpayer's net income
7 for the taxable year.
8 (d-1) Rate reduction for certain foreign insurers. In
9 the case of a foreign insurer, as defined by Section 35A-5 of
10 the Illinois Insurance Code, whose state or country of
11 domicile imposes on insurers domiciled in Illinois a
12 retaliatory tax (excluding any insurer whose reinsurance
13 premiums assumed are 50% or more of its total insurance
14 premiums as determined under paragraph (2) of subsection (b)
15 of Section 304, except that for purposes of this
16 determination reinsurance premiums do not include assumed
17 premiums from inter-affiliate pooling arrangements),
18 beginning with taxable years ending on or after December 31,
19 1999 and ending with taxable years ending on or before
20 December 31, 2000, the sum of the rates of tax imposed by
21 subsections (b) and (d) shall be reduced (but not increased)
22 to the rate at which the total amount of tax imposed under
23 this Act, net of all credits allowed under this Act, shall
24 equal (i) the total amount of tax that would be imposed on
25 the foreign insurer's net income allocable to Illinois for
26 the taxable year by such foreign insurer's state or country
27 of domicile if that net income were subject to all income
28 taxes and taxes measured by net income imposed by such
29 foreign insurer's state or country of domicile, net of all
30 credits allowed or (ii) a rate of zero if no such tax is
31 imposed on such income by the foreign insurer's state of
32 domicile.
33 (1) For the purposes of subsection (d-1), in no
34 event shall the sum of the rates of tax imposed by
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1 subsections (b) and (d) be reduced below the rate at
2 which the sum of:
3 (A) the total amount of tax imposed on such
4 foreign insurer under this Act for a taxable year,
5 net of all credits allowed under this Act, plus
6 (B) the privilege tax imposed by Section 409
7 of the Illinois Insurance Code, the fire insurance
8 company tax imposed by Section 12 of the Fire
9 Investigation Act, and the fire department taxes
10 imposed under Section 11-10-1 of the Illinois
11 Municipal Code,
12 equals 1.25% of the net taxable premiums written for the
13 taxable year, as described by subsection (1) of Section
14 409 of the Illinois Insurance Code. This paragraph will
15 in no event increase the rates imposed under subsections
16 (b) and (d).
17 (2) Any reduction in the rates of tax imposed by
18 this subsection shall be applied first against the rates
19 imposed by subsection (b) and only after the tax imposed
20 by subsection (a) net of all credits allowed under this
21 Section other than the credit allowed under subsection
22 (i) has been reduced to zero, against the rates imposed
23 by subsection (d).
24 (3) The provisions of this subsection (d-1) are
25 effective only through December 31, 2000 and cease to be
26 effective on January 1, 2001; but this does not affect
27 any claim or obligation based upon the use or application
28 of this subsection for tax years ending on December 31,
29 2000 or earlier.
30 (e) Investment credit. A taxpayer shall be allowed a
31 credit against the Personal Property Tax Replacement Income
32 Tax for investment in qualified property.
33 (1) A taxpayer shall be allowed a credit equal to
34 .5% of the basis of qualified property placed in service
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1 during the taxable year, provided such property is placed
2 in service on or after July 1, 1984. There shall be
3 allowed an additional credit equal to .5% of the basis of
4 qualified property placed in service during the taxable
5 year, provided such property is placed in service on or
6 after July 1, 1986, and the taxpayer's base employment
7 within Illinois has increased by 1% or more over the
8 preceding year as determined by the taxpayer's employment
9 records filed with the Illinois Department of Employment
10 Security. Taxpayers who are new to Illinois shall be
11 deemed to have met the 1% growth in base employment for
12 the first year in which they file employment records with
13 the Illinois Department of Employment Security. The
14 provisions added to this Section by Public Act 85-1200
15 (and restored by Public Act 87-895) shall be construed as
16 declaratory of existing law and not as a new enactment.
17 If, in any year, the increase in base employment within
18 Illinois over the preceding year is less than 1%, the
19 additional credit shall be limited to that percentage
20 times a fraction, the numerator of which is .5% and the
21 denominator of which is 1%, but shall not exceed .5%.
22 The investment credit shall not be allowed to the extent
23 that it would reduce a taxpayer's liability in any tax
24 year below zero, nor may any credit for qualified
25 property be allowed for any year other than the year in
26 which the property was placed in service in Illinois. For
27 tax years ending on or after December 31, 1987, and on or
28 before December 31, 1988, the credit shall be allowed for
29 the tax year in which the property is placed in service,
30 or, if the amount of the credit exceeds the tax liability
31 for that year, whether it exceeds the original liability
32 or the liability as later amended, such excess may be
33 carried forward and applied to the tax liability of the 5
34 taxable years following the excess credit years if the
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1 taxpayer (i) makes investments which cause the creation
2 of a minimum of 2,000 full-time equivalent jobs in
3 Illinois, (ii) is located in an enterprise zone
4 established pursuant to the Illinois Enterprise Zone Act
5 and (iii) is certified by the Department of Commerce and
6 Community Affairs as complying with the requirements
7 specified in clause (i) and (ii) by July 1, 1986. The
8 Department of Commerce and Community Affairs shall notify
9 the Department of Revenue of all such certifications
10 immediately. For tax years ending after December 31,
11 1988, the credit shall be allowed for the tax year in
12 which the property is placed in service, or, if the
13 amount of the credit exceeds the tax liability for that
14 year, whether it exceeds the original liability or the
15 liability as later amended, such excess may be carried
16 forward and applied to the tax liability of the 5 taxable
17 years following the excess credit years. The credit shall
18 be applied to the earliest year for which there is a
19 liability. If there is credit from more than one tax year
20 that is available to offset a liability, earlier credit
21 shall be applied first.
22 (2) The term "qualified property" means property
23 which:
24 (A) is tangible, whether new or used,
25 including buildings and structural components of
26 buildings and signs that are real property, but not
27 including land or improvements to real property that
28 are not a structural component of a building such as
29 landscaping, sewer lines, local access roads,
30 fencing, parking lots, and other appurtenances;
31 (B) is depreciable pursuant to Section 167 of
32 the Internal Revenue Code, except that "3-year
33 property" as defined in Section 168(c)(2)(A) of that
34 Code is not eligible for the credit provided by this
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1 subsection (e);
2 (C) is acquired by purchase as defined in
3 Section 179(d) of the Internal Revenue Code;
4 (D) is used in Illinois by a taxpayer who is
5 primarily engaged in manufacturing, or in mining
6 coal or fluorite, or in retailing; and
7 (E) has not previously been used in Illinois
8 in such a manner and by such a person as would
9 qualify for the credit provided by this subsection
10 (e) or subsection (f).
11 (3) For purposes of this subsection (e),
12 "manufacturing" means the material staging and production
13 of tangible personal property by procedures commonly
14 regarded as manufacturing, processing, fabrication, or
15 assembling which changes some existing material into new
16 shapes, new qualities, or new combinations. For purposes
17 of this subsection (e) the term "mining" shall have the
18 same meaning as the term "mining" in Section 613(c) of
19 the Internal Revenue Code. For purposes of this
20 subsection (e), the term "retailing" means the sale of
21 tangible personal property or services rendered in
22 conjunction with the sale of tangible consumer goods or
23 commodities.
24 (4) The basis of qualified property shall be the
25 basis used to compute the depreciation deduction for
26 federal income tax purposes.
27 (5) If the basis of the property for federal income
28 tax depreciation purposes is increased after it has been
29 placed in service in Illinois by the taxpayer, the amount
30 of such increase shall be deemed property placed in
31 service on the date of such increase in basis.
32 (6) The term "placed in service" shall have the
33 same meaning as under Section 46 of the Internal Revenue
34 Code.
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1 (7) If during any taxable year, any property ceases
2 to be qualified property in the hands of the taxpayer
3 within 48 months after being placed in service, or the
4 situs of any qualified property is moved outside Illinois
5 within 48 months after being placed in service, the
6 Personal Property Tax Replacement Income Tax for such
7 taxable year shall be increased. Such increase shall be
8 determined by (i) recomputing the investment credit which
9 would have been allowed for the year in which credit for
10 such property was originally allowed by eliminating such
11 property from such computation and, (ii) subtracting such
12 recomputed credit from the amount of credit previously
13 allowed. For the purposes of this paragraph (7), a
14 reduction of the basis of qualified property resulting
15 from a redetermination of the purchase price shall be
16 deemed a disposition of qualified property to the extent
17 of such reduction.
18 (8) Unless the investment credit is extended by
19 law, the basis of qualified property shall not include
20 costs incurred after December 31, 2003, except for costs
21 incurred pursuant to a binding contract entered into on
22 or before December 31, 2003.
23 (9) Each taxable year ending before December 31,
24 2000, a partnership may elect to pass through to its
25 partners the credits to which the partnership is entitled
26 under this subsection (e) for the taxable year. A
27 partner may use the credit allocated to him or her under
28 this paragraph only against the tax imposed in
29 subsections (c) and (d) of this Section. If the
30 partnership makes that election, those credits shall be
31 allocated among the partners in the partnership in
32 accordance with the rules set forth in Section 704(b) of
33 the Internal Revenue Code, and the rules promulgated
34 under that Section, and the allocated amount of the
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1 credits shall be allowed to the partners for that taxable
2 year. The partnership shall make this election on its
3 Personal Property Tax Replacement Income Tax return for
4 that taxable year. The election to pass through the
5 credits shall be irrevocable.
6 For taxable years ending on or after December 31,
7 2000, a partner that qualifies its partnership for a
8 subtraction under subparagraph (I) of paragraph (2) of
9 subsection (d) of Section 203 or a shareholder that
10 qualifies a Subchapter S corporation for a subtraction
11 under subparagraph (S) of paragraph (2) of subsection (b)
12 of Section 203 shall be allowed a credit under this
13 subsection (e) equal to its share of the credit earned
14 under this subsection (e) during the taxable year by the
15 partnership or Subchapter S corporation, determined in
16 accordance with the determination of income and
17 distributive share of income under Sections 702 and 704
18 and Subchapter S of the Internal Revenue Code. This
19 paragraph is exempt from the provisions of Section 250.
20 (f) Investment credit; Enterprise Zone.
21 (1) A taxpayer shall be allowed a credit against
22 the tax imposed by subsections (a) and (b) of this
23 Section for investment in qualified property which is
24 placed in service in an Enterprise Zone created pursuant
25 to the Illinois Enterprise Zone Act. For partners,
26 shareholders of Subchapter S corporations, and owners of
27 limited liability companies, if the liability company is
28 treated as a partnership for purposes of federal and
29 State income taxation, there shall be allowed a credit
30 under this subsection (f) to be determined in accordance
31 with the determination of income and distributive share
32 of income under Sections 702 and 704 and Subchapter S of
33 the Internal Revenue Code. The credit shall be .5% of the
34 basis for such property. The credit shall be available
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1 only in the taxable year in which the property is placed
2 in service in the Enterprise Zone and shall not be
3 allowed to the extent that it would reduce a taxpayer's
4 liability for the tax imposed by subsections (a) and (b)
5 of this Section to below zero. For tax years ending on or
6 after December 31, 1985, the credit shall be allowed for
7 the tax year in which the property is placed in service,
8 or, if the amount of the credit exceeds the tax liability
9 for that year, whether it exceeds the original liability
10 or the liability as later amended, such excess may be
11 carried forward and applied to the tax liability of the 5
12 taxable years following the excess credit year. The
13 credit shall be applied to the earliest year for which
14 there is a liability. If there is credit from more than
15 one tax year that is available to offset a liability, the
16 credit accruing first in time shall be applied first.
17 (2) The term qualified property means property
18 which:
19 (A) is tangible, whether new or used,
20 including buildings and structural components of
21 buildings;
22 (B) is depreciable pursuant to Section 167 of
23 the Internal Revenue Code, except that "3-year
24 property" as defined in Section 168(c)(2)(A) of that
25 Code is not eligible for the credit provided by this
26 subsection (f);
27 (C) is acquired by purchase as defined in
28 Section 179(d) of the Internal Revenue Code;
29 (D) is used in the Enterprise Zone by the
30 taxpayer; and
31 (E) has not been previously used in Illinois
32 in such a manner and by such a person as would
33 qualify for the credit provided by this subsection
34 (f) or subsection (e).
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1 (3) The basis of qualified property shall be the
2 basis used to compute the depreciation deduction for
3 federal income tax purposes.
4 (4) If the basis of the property for federal income
5 tax depreciation purposes is increased after it has been
6 placed in service in the Enterprise Zone by the taxpayer,
7 the amount of such increase shall be deemed property
8 placed in service on the date of such increase in basis.
9 (5) The term "placed in service" shall have the
10 same meaning as under Section 46 of the Internal Revenue
11 Code.
12 (6) If during any taxable year, any property ceases
13 to be qualified property in the hands of the taxpayer
14 within 48 months after being placed in service, or the
15 situs of any qualified property is moved outside the
16 Enterprise Zone within 48 months after being placed in
17 service, the tax imposed under subsections (a) and (b) of
18 this Section for such taxable year shall be increased.
19 Such increase shall be determined by (i) recomputing the
20 investment credit which would have been allowed for the
21 year in which credit for such property was originally
22 allowed by eliminating such property from such
23 computation, and (ii) subtracting such recomputed credit
24 from the amount of credit previously allowed. For the
25 purposes of this paragraph (6), a reduction of the basis
26 of qualified property resulting from a redetermination of
27 the purchase price shall be deemed a disposition of
28 qualified property to the extent of such reduction.
29 (g) Jobs Tax Credit; Enterprise Zone and Foreign Trade
30 Zone or Sub-Zone.
31 (1) A taxpayer conducting a trade or business in an
32 enterprise zone or a High Impact Business designated by
33 the Department of Commerce and Community Affairs
34 conducting a trade or business in a federally designated
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1 Foreign Trade Zone or Sub-Zone shall be allowed a credit
2 against the tax imposed by subsections (a) and (b) of
3 this Section in the amount of $500 per eligible employee
4 hired to work in the zone during the taxable year.
5 (2) To qualify for the credit:
6 (A) the taxpayer must hire 5 or more eligible
7 employees to work in an enterprise zone or federally
8 designated Foreign Trade Zone or Sub-Zone during the
9 taxable year;
10 (B) the taxpayer's total employment within the
11 enterprise zone or federally designated Foreign
12 Trade Zone or Sub-Zone must increase by 5 or more
13 full-time employees beyond the total employed in
14 that zone at the end of the previous tax year for
15 which a jobs tax credit under this Section was
16 taken, or beyond the total employed by the taxpayer
17 as of December 31, 1985, whichever is later; and
18 (C) the eligible employees must be employed
19 180 consecutive days in order to be deemed hired for
20 purposes of this subsection.
21 (3) An "eligible employee" means an employee who
22 is:
23 (A) Certified by the Department of Commerce
24 and Community Affairs as "eligible for services"
25 pursuant to regulations promulgated in accordance
26 with Title II of the Job Training Partnership Act,
27 Training Services for the Disadvantaged or Title III
28 of the Job Training Partnership Act, Employment and
29 Training Assistance for Dislocated Workers Program.
30 (B) Hired after the enterprise zone or
31 federally designated Foreign Trade Zone or Sub-Zone
32 was designated or the trade or business was located
33 in that zone, whichever is later.
34 (C) Employed in the enterprise zone or Foreign
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1 Trade Zone or Sub-Zone. An employee is employed in
2 an enterprise zone or federally designated Foreign
3 Trade Zone or Sub-Zone if his services are rendered
4 there or it is the base of operations for the
5 services performed.
6 (D) A full-time employee working 30 or more
7 hours per week.
8 (4) For tax years ending on or after December 31,
9 1985 and prior to December 31, 1988, the credit shall be
10 allowed for the tax year in which the eligible employees
11 are hired. For tax years ending on or after December 31,
12 1988, the credit shall be allowed for the tax year
13 immediately following the tax year in which the eligible
14 employees are hired. If the amount of the credit exceeds
15 the tax liability for that year, whether it exceeds the
16 original liability or the liability as later amended,
17 such excess may be carried forward and applied to the tax
18 liability of the 5 taxable years following the excess
19 credit year. The credit shall be applied to the earliest
20 year for which there is a liability. If there is credit
21 from more than one tax year that is available to offset a
22 liability, earlier credit shall be applied first.
23 (5) The Department of Revenue shall promulgate such
24 rules and regulations as may be deemed necessary to carry
25 out the purposes of this subsection (g).
26 (6) The credit shall be available for eligible
27 employees hired on or after January 1, 1986.
28 (h) Investment credit; High Impact Business.
29 (1) Subject to subsection (b) of Section 5.5 of the
30 Illinois Enterprise Zone Act, a taxpayer shall be allowed
31 a credit against the tax imposed by subsections (a) and
32 (b) of this Section for investment in qualified property
33 which is placed in service by a Department of Commerce
34 and Community Affairs designated High Impact Business.
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1 The credit shall be .5% of the basis for such property.
2 The credit shall not be available until the minimum
3 investments in qualified property set forth in Section
4 5.5 of the Illinois Enterprise Zone Act have been
5 satisfied and shall not be allowed to the extent that it
6 would reduce a taxpayer's liability for the tax imposed
7 by subsections (a) and (b) of this Section to below zero.
8 The credit applicable to such minimum investments shall
9 be taken in the taxable year in which such minimum
10 investments have been completed. The credit for
11 additional investments beyond the minimum investment by a
12 designated high impact business shall be available only
13 in the taxable year in which the property is placed in
14 service and shall not be allowed to the extent that it
15 would reduce a taxpayer's liability for the tax imposed
16 by subsections (a) and (b) of this Section to below zero.
17 For tax years ending on or after December 31, 1987, the
18 credit shall be allowed for the tax year in which the
19 property is placed in service, or, if the amount of the
20 credit exceeds the tax liability for that year, whether
21 it exceeds the original liability or the liability as
22 later amended, such excess may be carried forward and
23 applied to the tax liability of the 5 taxable years
24 following the excess credit year. The credit shall be
25 applied to the earliest year for which there is a
26 liability. If there is credit from more than one tax
27 year that is available to offset a liability, the credit
28 accruing first in time shall be applied first.
29 Changes made in this subdivision (h)(1) by Public
30 Act 88-670 restore changes made by Public Act 85-1182 and
31 reflect existing law.
32 (2) The term qualified property means property
33 which:
34 (A) is tangible, whether new or used,
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1 including buildings and structural components of
2 buildings;
3 (B) is depreciable pursuant to Section 167 of
4 the Internal Revenue Code, except that "3-year
5 property" as defined in Section 168(c)(2)(A) of that
6 Code is not eligible for the credit provided by this
7 subsection (h);
8 (C) is acquired by purchase as defined in
9 Section 179(d) of the Internal Revenue Code; and
10 (D) is not eligible for the Enterprise Zone
11 Investment Credit provided by subsection (f) of this
12 Section.
13 (3) The basis of qualified property shall be the
14 basis used to compute the depreciation deduction for
15 federal income tax purposes.
16 (4) If the basis of the property for federal income
17 tax depreciation purposes is increased after it has been
18 placed in service in a federally designated Foreign Trade
19 Zone or Sub-Zone located in Illinois by the taxpayer, the
20 amount of such increase shall be deemed property placed
21 in service on the date of such increase in basis.
22 (5) The term "placed in service" shall have the
23 same meaning as under Section 46 of the Internal Revenue
24 Code.
25 (6) If during any taxable year ending on or before
26 December 31, 1996, any property ceases to be qualified
27 property in the hands of the taxpayer within 48 months
28 after being placed in service, or the situs of any
29 qualified property is moved outside Illinois within 48
30 months after being placed in service, the tax imposed
31 under subsections (a) and (b) of this Section for such
32 taxable year shall be increased. Such increase shall be
33 determined by (i) recomputing the investment credit which
34 would have been allowed for the year in which credit for
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1 such property was originally allowed by eliminating such
2 property from such computation, and (ii) subtracting such
3 recomputed credit from the amount of credit previously
4 allowed. For the purposes of this paragraph (6), a
5 reduction of the basis of qualified property resulting
6 from a redetermination of the purchase price shall be
7 deemed a disposition of qualified property to the extent
8 of such reduction.
9 (7) Beginning with tax years ending after December
10 31, 1996, if a taxpayer qualifies for the credit under
11 this subsection (h) and thereby is granted a tax
12 abatement and the taxpayer relocates its entire facility
13 in violation of the explicit terms and length of the
14 contract under Section 18-183 of the Property Tax Code,
15 the tax imposed under subsections (a) and (b) of this
16 Section shall be increased for the taxable year in which
17 the taxpayer relocated its facility by an amount equal to
18 the amount of credit received by the taxpayer under this
19 subsection (h).
20 (i) A credit shall be allowed against the tax imposed by
21 subsections (a) and (b) of this Section for the tax imposed
22 by subsections (c) and (d) of this Section. This credit
23 shall be computed by multiplying the tax imposed by
24 subsections (c) and (d) of this Section by a fraction, the
25 numerator of which is base income allocable to Illinois and
26 the denominator of which is Illinois base income, and further
27 multiplying the product by the tax rate imposed by
28 subsections (a) and (b) of this Section.
29 Any credit earned on or after December 31, 1986 under
30 this subsection which is unused in the year the credit is
31 computed because it exceeds the tax liability imposed by
32 subsections (a) and (b) for that year (whether it exceeds the
33 original liability or the liability as later amended) may be
34 carried forward and applied to the tax liability imposed by
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1 subsections (a) and (b) of the 5 taxable years following the
2 excess credit year. This credit shall be applied first to
3 the earliest year for which there is a liability. If there
4 is a credit under this subsection from more than one tax year
5 that is available to offset a liability the earliest credit
6 arising under this subsection shall be applied first.
7 If, during any taxable year ending on or after December
8 31, 1986, the tax imposed by subsections (c) and (d) of this
9 Section for which a taxpayer has claimed a credit under this
10 subsection (i) is reduced, the amount of credit for such tax
11 shall also be reduced. Such reduction shall be determined by
12 recomputing the credit to take into account the reduced tax
13 imposed by subsection (c) and (d). If any portion of the
14 reduced amount of credit has been carried to a different
15 taxable year, an amended return shall be filed for such
16 taxable year to reduce the amount of credit claimed.
17 (j) Training expense credit. Beginning with tax years
18 ending on or after December 31, 1986, a taxpayer shall be
19 allowed a credit against the tax imposed by subsection (a)
20 and (b) under this Section for all amounts paid or accrued,
21 on behalf of all persons employed by the taxpayer in Illinois
22 or Illinois residents employed outside of Illinois by a
23 taxpayer, for educational or vocational training in
24 semi-technical or technical fields or semi-skilled or skilled
25 fields, which were deducted from gross income in the
26 computation of taxable income. The credit against the tax
27 imposed by subsections (a) and (b) shall be 1.6% of such
28 training expenses. For partners, shareholders of subchapter
29 S corporations, and owners of limited liability companies, if
30 the liability company is treated as a partnership for
31 purposes of federal and State income taxation, there shall be
32 allowed a credit under this subsection (j) to be determined
33 in accordance with the determination of income and
34 distributive share of income under Sections 702 and 704 and
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1 subchapter S of the Internal Revenue Code.
2 Any credit allowed under this subsection which is unused
3 in the year the credit is earned may be carried forward to
4 each of the 5 taxable years following the year for which the
5 credit is first computed until it is used. This credit shall
6 be applied first to the earliest year for which there is a
7 liability. If there is a credit under this subsection from
8 more than one tax year that is available to offset a
9 liability the earliest credit arising under this subsection
10 shall be applied first.
11 (k) Research and development credit.
12 Beginning with tax years ending after July 1, 1990, a
13 taxpayer shall be allowed a credit against the tax imposed by
14 subsections (a) and (b) of this Section for increasing
15 research activities in this State. The credit allowed
16 against the tax imposed by subsections (a) and (b) shall be
17 equal to 6 1/2% of the qualifying expenditures for increasing
18 research activities in this State. For partners, shareholders
19 of subchapter S corporations, and owners of limited liability
20 companies, if the liability company is treated as a
21 partnership for purposes of federal and State income
22 taxation, there shall be allowed a credit under this
23 subsection to be determined in accordance with the
24 determination of income and distributive share of income
25 under Sections 702 and 704 and subchapter S of the Internal
26 Revenue Code.
27 For purposes of this subsection, "qualifying
28 expenditures" means the qualifying expenditures as defined
29 for the federal credit for increasing research activities
30 which would be allowable under Section 41 of the Internal
31 Revenue Code and which are conducted in this State,
32 "qualifying expenditures for increasing research activities
33 in this State" means the excess of qualifying expenditures
34 for the taxable year in which incurred over qualifying
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1 expenditures for the base period, "qualifying expenditures
2 for the base period" means the average of the qualifying
3 expenditures for each year in the base period, and "base
4 period" means the 3 taxable years immediately preceding the
5 taxable year for which the determination is being made.
6 Any credit in excess of the tax liability for the taxable
7 year may be carried forward. A taxpayer may elect to have the
8 unused credit shown on its final completed return carried
9 over as a credit against the tax liability for the following
10 5 taxable years or until it has been fully used, whichever
11 occurs first.
12 If an unused credit is carried forward to a given year
13 from 2 or more earlier years, that credit arising in the
14 earliest year will be applied first against the tax liability
15 for the given year. If a tax liability for the given year
16 still remains, the credit from the next earliest year will
17 then be applied, and so on, until all credits have been used
18 or no tax liability for the given year remains. Any
19 remaining unused credit or credits then will be carried
20 forward to the next following year in which a tax liability
21 is incurred, except that no credit can be carried forward to
22 a year which is more than 5 years after the year in which the
23 expense for which the credit is given was incurred.
24 Unless extended by law, the credit shall not include
25 costs incurred after December 31, 2004, except for costs
26 incurred pursuant to a binding contract entered into on or
27 before December 31, 2004.
28 No inference shall be drawn from this amendatory Act of
29 the 91st General Assembly in construing this Section for
30 taxable years beginning before January 1, 1999.
31 (l) Environmental Remediation Tax Credit.
32 (i) For tax years ending after December 31, 1997
33 and on or before December 31, 2001, a taxpayer shall be
34 allowed a credit against the tax imposed by subsections
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1 (a) and (b) of this Section for certain amounts paid for
2 unreimbursed eligible remediation costs, as specified in
3 this subsection. For purposes of this Section,
4 "unreimbursed eligible remediation costs" means costs
5 approved by the Illinois Environmental Protection Agency
6 ("Agency") under Section 58.14 of the Environmental
7 Protection Act that were paid in performing environmental
8 remediation at a site for which a No Further Remediation
9 Letter was issued by the Agency and recorded under
10 Section 58.10 of the Environmental Protection Act. The
11 credit must be claimed for the taxable year in which
12 Agency approval of the eligible remediation costs is
13 granted. The credit is not available to any taxpayer if
14 the taxpayer or any related party caused or contributed
15 to, in any material respect, a release of regulated
16 substances on, in, or under the site that was identified
17 and addressed by the remedial action pursuant to the Site
18 Remediation Program of the Environmental Protection Act.
19 After the Pollution Control Board rules are adopted
20 pursuant to the Illinois Administrative Procedure Act for
21 the administration and enforcement of Section 58.9 of the
22 Environmental Protection Act, determinations as to credit
23 availability for purposes of this Section shall be made
24 consistent with those rules. For purposes of this
25 Section, "taxpayer" includes a person whose tax
26 attributes the taxpayer has succeeded to under Section
27 381 of the Internal Revenue Code and "related party"
28 includes the persons disallowed a deduction for losses by
29 paragraphs (b), (c), and (f)(1) of Section 267 of the
30 Internal Revenue Code by virtue of being a related
31 taxpayer, as well as any of its partners. The credit
32 allowed against the tax imposed by subsections (a) and
33 (b) shall be equal to 25% of the unreimbursed eligible
34 remediation costs in excess of $100,000 per site, except
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1 that the $100,000 threshold shall not apply to any site
2 contained in an enterprise zone as determined by the
3 Department of Commerce and Community Affairs. The total
4 credit allowed shall not exceed $40,000 per year with a
5 maximum total of $150,000 per site. For partners and
6 shareholders of subchapter S corporations, there shall be
7 allowed a credit under this subsection to be determined
8 in accordance with the determination of income and
9 distributive share of income under Sections 702 and 704
10 of subchapter S of the Internal Revenue Code.
11 (ii) A credit allowed under this subsection that is
12 unused in the year the credit is earned may be carried
13 forward to each of the 5 taxable years following the year
14 for which the credit is first earned until it is used.
15 The term "unused credit" does not include any amounts of
16 unreimbursed eligible remediation costs in excess of the
17 maximum credit per site authorized under paragraph (i).
18 This credit shall be applied first to the earliest year
19 for which there is a liability. If there is a credit
20 under this subsection from more than one tax year that is
21 available to offset a liability, the earliest credit
22 arising under this subsection shall be applied first. A
23 credit allowed under this subsection may be sold to a
24 buyer as part of a sale of all or part of the remediation
25 site for which the credit was granted. The purchaser of
26 a remediation site and the tax credit shall succeed to
27 the unused credit and remaining carry-forward period of
28 the seller. To perfect the transfer, the assignor shall
29 record the transfer in the chain of title for the site
30 and provide written notice to the Director of the
31 Illinois Department of Revenue of the assignor's intent
32 to sell the remediation site and the amount of the tax
33 credit to be transferred as a portion of the sale. In no
34 event may a credit be transferred to any taxpayer if the
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1 taxpayer or a related party would not be eligible under
2 the provisions of subsection (i).
3 (iii) For purposes of this Section, the term "site"
4 shall have the same meaning as under Section 58.2 of the
5 Environmental Protection Act.
6 (m) Education expense credit.
7 Beginning with tax years ending after December 31, 1999,
8 a taxpayer who is the custodian of one or more qualifying
9 pupils shall be allowed a credit against the tax imposed by
10 subsections (a) and (b) of this Section for qualified
11 education expenses incurred on behalf of the qualifying
12 pupils. The credit shall be equal to 25% of qualified
13 education expenses, but in no event may the total credit
14 under this Section claimed by a family that is the custodian
15 of qualifying pupils exceed $500. In no event shall a credit
16 under this subsection reduce the taxpayer's liability under
17 this Act to less than zero. This subsection is exempt from
18 the provisions of Section 250 of this Act.
19 For purposes of this subsection;
20 "Qualifying pupils" means individuals who (i) are
21 residents of the State of Illinois, (ii) are under the age of
22 21 at the close of the school year for which a credit is
23 sought, and (iii) during the school year for which a credit
24 is sought were full-time pupils enrolled in a kindergarten
25 through twelfth grade education program at any school, as
26 defined in this subsection.
27 "Qualified education expense" means the amount incurred
28 on behalf of a qualifying pupil in excess of $250 for
29 tuition, book fees, and lab fees at the school in which the
30 pupil is enrolled during the regular school year.
31 "School" means any public or nonpublic elementary or
32 secondary school in Illinois that is in compliance with Title
33 VI of the Civil Rights Act of 1964 and attendance at which
34 satisfies the requirements of Section 26-1 of the School
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1 Code, except that nothing shall be construed to require a
2 child to attend any particular public or nonpublic school to
3 qualify for the credit under this Section.
4 "Custodian" means, with respect to qualifying pupils, an
5 Illinois resident who is a parent, the parents, a legal
6 guardian, or the legal guardians of the qualifying pupils.
7 (Source: P.A. 90-123, eff. 7-21-97; 90-458, eff. 8-17-97;
8 90-605, eff. 6-30-98; 90-655, eff. 7-30-98; 90-717, eff.
9 8-7-98; 90-792, eff. 1-1-99; 91-9, eff. 1-1-00; 91-357, eff.
10 7-29-99; 91-643, eff. 8-20-99; 91-644, eff. 8-20-99; revised
11 8-27-99.)
12 (35 ILCS 5/203) (from Ch. 120, par. 2-203)
13 Sec. 203. Base income defined.
14 (a) Individuals.
15 (1) In general. In the case of an individual, base
16 income means an amount equal to the taxpayer's adjusted
17 gross income for the taxable year as modified by
18 paragraph (2).
19 (2) Modifications. The adjusted gross income
20 referred to in paragraph (1) shall be modified by adding
21 thereto the sum of the following amounts:
22 (A) An amount equal to all amounts paid or
23 accrued to the taxpayer as interest or dividends
24 during the taxable year to the extent excluded from
25 gross income in the computation of adjusted gross
26 income, except stock dividends of qualified public
27 utilities described in Section 305(e) of the
28 Internal Revenue Code;
29 (B) An amount equal to the amount of tax
30 imposed by this Act to the extent deducted from
31 gross income in the computation of adjusted gross
32 income for the taxable year;
33 (C) An amount equal to the amount received
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1 during the taxable year as a recovery or refund of
2 real property taxes paid with respect to the
3 taxpayer's principal residence under the Revenue Act
4 of 1939 and for which a deduction was previously
5 taken under subparagraph (L) of this paragraph (2)
6 prior to July 1, 1991, the retrospective application
7 date of Article 4 of Public Act 87-17. In the case
8 of multi-unit or multi-use structures and farm
9 dwellings, the taxes on the taxpayer's principal
10 residence shall be that portion of the total taxes
11 for the entire property which is attributable to
12 such principal residence;
13 (D) An amount equal to the amount of the
14 capital gain deduction allowable under the Internal
15 Revenue Code, to the extent deducted from gross
16 income in the computation of adjusted gross income;
17 (D-5) An amount, to the extent not included in
18 adjusted gross income, equal to the amount of money
19 withdrawn by the taxpayer in the taxable year from a
20 medical care savings account and the interest earned
21 on the account in the taxable year of a withdrawal
22 pursuant to subsection (b) of Section 20 of the
23 Medical Care Savings Account Act; and
24 (D-10) For taxable years ending after December
25 31, 1997, an amount equal to any eligible
26 remediation costs that the individual deducted in
27 computing adjusted gross income and for which the
28 individual claims a credit under subsection (l) of
29 Section 201;
30 and by deducting from the total so obtained the sum of
31 the following amounts:
32 (E) Any amount included in such total in
33 respect of any compensation (including but not
34 limited to any compensation paid or accrued to a
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1 serviceman while a prisoner of war or missing in
2 action) paid to a resident by reason of being on
3 active duty in the Armed Forces of the United States
4 and in respect of any compensation paid or accrued
5 to a resident who as a governmental employee was a
6 prisoner of war or missing in action, and in respect
7 of any compensation paid to a resident in 1971 or
8 thereafter for annual training performed pursuant to
9 Sections 502 and 503, Title 32, United States Code
10 as a member of the Illinois National Guard;
11 (F) An amount equal to all amounts included in
12 such total pursuant to the provisions of Sections
13 402(a), 402(c), 403(a), 403(b), 406(a), 407(a), and
14 408 of the Internal Revenue Code, or included in
15 such total as distributions under the provisions of
16 any retirement or disability plan for employees of
17 any governmental agency or unit, or retirement
18 payments to retired partners, which payments are
19 excluded in computing net earnings from self
20 employment by Section 1402 of the Internal Revenue
21 Code and regulations adopted pursuant thereto;
22 (G) The valuation limitation amount;
23 (H) An amount equal to the amount of any tax
24 imposed by this Act which was refunded to the
25 taxpayer and included in such total for the taxable
26 year;
27 (I) An amount equal to all amounts included in
28 such total pursuant to the provisions of Section 111
29 of the Internal Revenue Code as a recovery of items
30 previously deducted from adjusted gross income in
31 the computation of taxable income;
32 (J) An amount equal to those dividends
33 included in such total which were paid by a
34 corporation which conducts business operations in an
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1 Enterprise Zone or zones created under the Illinois
2 Enterprise Zone Act, and conducts substantially all
3 of its operations in an Enterprise Zone or zones;
4 (K) An amount equal to those dividends
5 included in such total that were paid by a
6 corporation that conducts business operations in a
7 federally designated Foreign Trade Zone or Sub-Zone
8 and that is designated a High Impact Business
9 located in Illinois; provided that dividends
10 eligible for the deduction provided in subparagraph
11 (J) of paragraph (2) of this subsection shall not be
12 eligible for the deduction provided under this
13 subparagraph (K);
14 (L) For taxable years ending after December
15 31, 1983, an amount equal to all social security
16 benefits and railroad retirement benefits included
17 in such total pursuant to Sections 72(r) and 86 of
18 the Internal Revenue Code;
19 (M) With the exception of any amounts
20 subtracted under subparagraph (N), an amount equal
21 to the sum of all amounts disallowed as deductions
22 by (i) Sections 171(a) (2), and 265(2) of the
23 Internal Revenue Code of 1954, as now or hereafter
24 amended, and all amounts of expenses allocable to
25 interest and disallowed as deductions by Section
26 265(1) of the Internal Revenue Code of 1954, as now
27 or hereafter amended; and (ii) for taxable years
28 ending on or after August 13, 1999 the effective
29 date of this amendatory Act of the 91st General
30 Assembly, Sections 171(a)(2), 265, 280C, and
31 832(b)(5)(B)(i) of the Internal Revenue Code; the
32 provisions of this subparagraph are exempt from the
33 provisions of Section 250;
34 (N) An amount equal to all amounts included in
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1 such total which are exempt from taxation by this
2 State either by reason of its statutes or
3 Constitution or by reason of the Constitution,
4 treaties or statutes of the United States; provided
5 that, in the case of any statute of this State that
6 exempts income derived from bonds or other
7 obligations from the tax imposed under this Act, the
8 amount exempted shall be the interest net of bond
9 premium amortization;
10 (O) An amount equal to any contribution made
11 to a job training project established pursuant to
12 the Tax Increment Allocation Redevelopment Act;
13 (P) An amount equal to the amount of the
14 deduction used to compute the federal income tax
15 credit for restoration of substantial amounts held
16 under claim of right for the taxable year pursuant
17 to Section 1341 of the Internal Revenue Code of
18 1986;
19 (Q) An amount equal to any amounts included in
20 such total, received by the taxpayer as an
21 acceleration in the payment of life, endowment or
22 annuity benefits in advance of the time they would
23 otherwise be payable as an indemnity for a terminal
24 illness;
25 (R) An amount equal to the amount of any
26 federal or State bonus paid to veterans of the
27 Persian Gulf War;
28 (S) An amount, to the extent included in
29 adjusted gross income, equal to the amount of a
30 contribution made in the taxable year on behalf of
31 the taxpayer to a medical care savings account
32 established under the Medical Care Savings Account
33 Act to the extent the contribution is accepted by
34 the account administrator as provided in that Act;
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1 (T) An amount, to the extent included in
2 adjusted gross income, equal to the amount of
3 interest earned in the taxable year on a medical
4 care savings account established under the Medical
5 Care Savings Account Act on behalf of the taxpayer,
6 other than interest added pursuant to item (D-5) of
7 this paragraph (2);
8 (U) For one taxable year beginning on or after
9 January 1, 1994, an amount equal to the total amount
10 of tax imposed and paid under subsections (a) and
11 (b) of Section 201 of this Act on grant amounts
12 received by the taxpayer under the Nursing Home
13 Grant Assistance Act during the taxpayer's taxable
14 years 1992 and 1993;
15 (V) Beginning with tax years ending on or
16 after December 31, 1995 and ending with tax years
17 ending on or before December 31, 2004, an amount
18 equal to the amount paid by a taxpayer who is a
19 self-employed taxpayer, a partner of a partnership,
20 or a shareholder in a Subchapter S corporation for
21 health insurance or long-term care insurance for
22 that taxpayer or that taxpayer's spouse or
23 dependents, to the extent that the amount paid for
24 that health insurance or long-term care insurance
25 may be deducted under Section 213 of the Internal
26 Revenue Code of 1986, has not been deducted on the
27 federal income tax return of the taxpayer, and does
28 not exceed the taxable income attributable to that
29 taxpayer's income, self-employment income, or
30 Subchapter S corporation income; except that no
31 deduction shall be allowed under this item (V) if
32 the taxpayer is eligible to participate in any
33 health insurance or long-term care insurance plan of
34 an employer of the taxpayer or the taxpayer's
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1 spouse. The amount of the health insurance and
2 long-term care insurance subtracted under this item
3 (V) shall be determined by multiplying total health
4 insurance and long-term care insurance premiums paid
5 by the taxpayer times a number that represents the
6 fractional percentage of eligible medical expenses
7 under Section 213 of the Internal Revenue Code of
8 1986 not actually deducted on the taxpayer's federal
9 income tax return;
10 (W) For taxable years beginning on or after
11 January 1, 1998, all amounts included in the
12 taxpayer's federal gross income in the taxable year
13 from amounts converted from a regular IRA to a Roth
14 IRA. This paragraph is exempt from the provisions of
15 Section 250; and
16 (X) For taxable year 1999 and thereafter, an
17 amount equal to the amount of any (i) distributions,
18 to the extent includible in gross income for federal
19 income tax purposes, made to the taxpayer because of
20 his or her status as a victim of persecution for
21 racial or religious reasons by Nazi Germany or any
22 other Axis regime or as an heir of the victim and
23 (ii) items of income, to the extent includible in
24 gross income for federal income tax purposes,
25 attributable to, derived from or in any way related
26 to assets stolen from, hidden from, or otherwise
27 lost to a victim of persecution for racial or
28 religious reasons by Nazi Germany or any other Axis
29 regime immediately prior to, during, and immediately
30 after World War II, including, but not limited to,
31 interest on the proceeds receivable as insurance
32 under policies issued to a victim of persecution for
33 racial or religious reasons by Nazi Germany or any
34 other Axis regime by European insurance companies
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1 immediately prior to and during World War II;
2 provided, however, this subtraction from federal
3 adjusted gross income does not apply to assets
4 acquired with such assets or with the proceeds from
5 the sale of such assets; provided, further, this
6 paragraph shall only apply to a taxpayer who was the
7 first recipient of such assets after their recovery
8 and who is a victim of persecution for racial or
9 religious reasons by Nazi Germany or any other Axis
10 regime or as an heir of the victim. The amount of
11 and the eligibility for any public assistance,
12 benefit, or similar entitlement is not affected by
13 the inclusion of items (i) and (ii) of this
14 paragraph in gross income for federal income tax
15 purposes. This paragraph is exempt from the
16 provisions of Section 250.
17 (b) Corporations.
18 (1) In general. In the case of a corporation, base
19 income means an amount equal to the taxpayer's taxable
20 income for the taxable year as modified by paragraph (2).
21 (2) Modifications. The taxable income referred to
22 in paragraph (1) shall be modified by adding thereto the
23 sum of the following amounts:
24 (A) An amount equal to all amounts paid or
25 accrued to the taxpayer as interest and all
26 distributions received from regulated investment
27 companies during the taxable year to the extent
28 excluded from gross income in the computation of
29 taxable income;
30 (B) An amount equal to the amount of tax
31 imposed by this Act to the extent deducted from
32 gross income in the computation of taxable income
33 for the taxable year;
34 (C) In the case of a regulated investment
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1 company, an amount equal to the excess of (i) the
2 net long-term capital gain for the taxable year,
3 over (ii) the amount of the capital gain dividends
4 designated as such in accordance with Section
5 852(b)(3)(C) of the Internal Revenue Code and any
6 amount designated under Section 852(b)(3)(D) of the
7 Internal Revenue Code, attributable to the taxable
8 year (this amendatory Act of 1995 (Public Act 89-89)
9 is declarative of existing law and is not a new
10 enactment);
11 (D) The amount of any net operating loss
12 deduction taken in arriving at taxable income, other
13 than a net operating loss carried forward from a
14 taxable year ending prior to December 31, 1986;
15 (E) For taxable years in which a net operating
16 loss carryback or carryforward from a taxable year
17 ending prior to December 31, 1986 is an element of
18 taxable income under paragraph (1) of subsection (e)
19 or subparagraph (E) of paragraph (2) of subsection
20 (e), the amount by which addition modifications
21 other than those provided by this subparagraph (E)
22 exceeded subtraction modifications in such earlier
23 taxable year, with the following limitations applied
24 in the order that they are listed:
25 (i) the addition modification relating to
26 the net operating loss carried back or forward
27 to the taxable year from any taxable year
28 ending prior to December 31, 1986 shall be
29 reduced by the amount of addition modification
30 under this subparagraph (E) which related to
31 that net operating loss and which was taken
32 into account in calculating the base income of
33 an earlier taxable year, and
34 (ii) the addition modification relating
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1 to the net operating loss carried back or
2 forward to the taxable year from any taxable
3 year ending prior to December 31, 1986 shall
4 not exceed the amount of such carryback or
5 carryforward;
6 For taxable years in which there is a net
7 operating loss carryback or carryforward from more
8 than one other taxable year ending prior to December
9 31, 1986, the addition modification provided in this
10 subparagraph (E) shall be the sum of the amounts
11 computed independently under the preceding
12 provisions of this subparagraph (E) for each such
13 taxable year; and
14 (E-5) For taxable years ending after December
15 31, 1997, an amount equal to any eligible
16 remediation costs that the corporation deducted in
17 computing adjusted gross income and for which the
18 corporation claims a credit under subsection (l) of
19 Section 201;
20 and by deducting from the total so obtained the sum of
21 the following amounts:
22 (F) An amount equal to the amount of any tax
23 imposed by this Act which was refunded to the
24 taxpayer and included in such total for the taxable
25 year;
26 (G) An amount equal to any amount included in
27 such total under Section 78 of the Internal Revenue
28 Code;
29 (H) In the case of a regulated investment
30 company, an amount equal to the amount of exempt
31 interest dividends as defined in subsection (b) (5)
32 of Section 852 of the Internal Revenue Code, paid to
33 shareholders for the taxable year;
34 (I) With the exception of any amounts
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1 subtracted under subparagraph (J), an amount equal
2 to the sum of all amounts disallowed as deductions
3 by (i) Sections 171(a) (2), and 265(a)(2) and
4 amounts disallowed as interest expense by Section
5 291(a)(3) of the Internal Revenue Code, as now or
6 hereafter amended, and all amounts of expenses
7 allocable to interest and disallowed as deductions
8 by Section 265(a)(1) of the Internal Revenue Code,
9 as now or hereafter amended; and (ii) for taxable
10 years ending on or after August 13, 1999 the
11 effective date of this amendatory Act of the 91st
12 General Assembly, Sections 171(a)(2), 265, 280C,
13 291(a)(3), and 832(b)(5)(B)(i) of the Internal
14 Revenue Code; the provisions of this subparagraph
15 are exempt from the provisions of Section 250;
16 (J) An amount equal to all amounts included in
17 such total which are exempt from taxation by this
18 State either by reason of its statutes or
19 Constitution or by reason of the Constitution,
20 treaties or statutes of the United States; provided
21 that, in the case of any statute of this State that
22 exempts income derived from bonds or other
23 obligations from the tax imposed under this Act, the
24 amount exempted shall be the interest net of bond
25 premium amortization;
26 (K) An amount equal to those dividends
27 included in such total which were paid by a
28 corporation which conducts business operations in an
29 Enterprise Zone or zones created under the Illinois
30 Enterprise Zone Act and conducts substantially all
31 of its operations in an Enterprise Zone or zones;
32 (L) An amount equal to those dividends
33 included in such total that were paid by a
34 corporation that conducts business operations in a
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1 federally designated Foreign Trade Zone or Sub-Zone
2 and that is designated a High Impact Business
3 located in Illinois; provided that dividends
4 eligible for the deduction provided in subparagraph
5 (K) of paragraph 2 of this subsection shall not be
6 eligible for the deduction provided under this
7 subparagraph (L);
8 (M) For any taxpayer that is a financial
9 organization within the meaning of Section 304(c) of
10 this Act, an amount included in such total as
11 interest income from a loan or loans made by such
12 taxpayer to a borrower, to the extent that such a
13 loan is secured by property which is eligible for
14 the Enterprise Zone Investment Credit. To determine
15 the portion of a loan or loans that is secured by
16 property eligible for a Section 201(h) investment
17 credit to the borrower, the entire principal amount
18 of the loan or loans between the taxpayer and the
19 borrower should be divided into the basis of the
20 Section 201(h) investment credit property which
21 secures the loan or loans, using for this purpose
22 the original basis of such property on the date that
23 it was placed in service in the Enterprise Zone.
24 The subtraction modification available to taxpayer
25 in any year under this subsection shall be that
26 portion of the total interest paid by the borrower
27 with respect to such loan attributable to the
28 eligible property as calculated under the previous
29 sentence;
30 (M-1) For any taxpayer that is a financial
31 organization within the meaning of Section 304(c) of
32 this Act, an amount included in such total as
33 interest income from a loan or loans made by such
34 taxpayer to a borrower, to the extent that such a
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1 loan is secured by property which is eligible for
2 the High Impact Business Investment Credit. To
3 determine the portion of a loan or loans that is
4 secured by property eligible for a Section 201(i)
5 investment credit to the borrower, the entire
6 principal amount of the loan or loans between the
7 taxpayer and the borrower should be divided into the
8 basis of the Section 201(i) investment credit
9 property which secures the loan or loans, using for
10 this purpose the original basis of such property on
11 the date that it was placed in service in a
12 federally designated Foreign Trade Zone or Sub-Zone
13 located in Illinois. No taxpayer that is eligible
14 for the deduction provided in subparagraph (M) of
15 paragraph (2) of this subsection shall be eligible
16 for the deduction provided under this subparagraph
17 (M-1). The subtraction modification available to
18 taxpayers in any year under this subsection shall be
19 that portion of the total interest paid by the
20 borrower with respect to such loan attributable to
21 the eligible property as calculated under the
22 previous sentence;
23 (N) Two times any contribution made during the
24 taxable year to a designated zone organization to
25 the extent that the contribution (i) qualifies as a
26 charitable contribution under subsection (c) of
27 Section 170 of the Internal Revenue Code and (ii)
28 must, by its terms, be used for a project approved
29 by the Department of Commerce and Community Affairs
30 under Section 11 of the Illinois Enterprise Zone
31 Act;
32 (O) An amount equal to: (i) 85% for taxable
33 years ending on or before December 31, 1992, or, a
34 percentage equal to the percentage allowable under
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1 Section 243(a)(1) of the Internal Revenue Code of
2 1986 for taxable years ending after December 31,
3 1992, of the amount by which dividends included in
4 taxable income and received from a corporation that
5 is not created or organized under the laws of the
6 United States or any state or political subdivision
7 thereof, including, for taxable years ending on or
8 after December 31, 1988, dividends received or
9 deemed received or paid or deemed paid under
10 Sections 951 through 964 of the Internal Revenue
11 Code, exceed the amount of the modification provided
12 under subparagraph (G) of paragraph (2) of this
13 subsection (b) which is related to such dividends;
14 plus (ii) 100% of the amount by which dividends,
15 included in taxable income and received, including,
16 for taxable years ending on or after December 31,
17 1988, dividends received or deemed received or paid
18 or deemed paid under Sections 951 through 964 of the
19 Internal Revenue Code, from any such corporation
20 specified in clause (i) that would but for the
21 provisions of Section 1504 (b) (3) of the Internal
22 Revenue Code be treated as a member of the
23 affiliated group which includes the dividend
24 recipient, exceed the amount of the modification
25 provided under subparagraph (G) of paragraph (2) of
26 this subsection (b) which is related to such
27 dividends;
28 (P) An amount equal to any contribution made
29 to a job training project established pursuant to
30 the Tax Increment Allocation Redevelopment Act;
31 (Q) An amount equal to the amount of the
32 deduction used to compute the federal income tax
33 credit for restoration of substantial amounts held
34 under claim of right for the taxable year pursuant
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1 to Section 1341 of the Internal Revenue Code of
2 1986; and
3 (R) In the case of an attorney-in-fact with
4 respect to whom an interinsurer or a reciprocal
5 insurer has made the election under Section 835 of
6 the Internal Revenue Code, 26 U.S.C. 835, an amount
7 equal to the excess, if any, of the amounts paid or
8 incurred by that interinsurer or reciprocal insurer
9 in the taxable year to the attorney-in-fact over the
10 deduction allowed to that interinsurer or reciprocal
11 insurer with respect to the attorney-in-fact under
12 Section 835(b) of the Internal Revenue Code for the
13 taxable year; and
14 (S) For taxable years ending on or after
15 December 31, 1997, in the case of a Subchapter S
16 corporation, an amount equal to all amounts of
17 income allocable to a shareholder subject to the
18 Personal Property Tax Replacement Income Tax imposed
19 by subsections (c) and (d) of Section 201 of this
20 Act, including amounts allocable to organizations
21 exempt from federal income tax by reason of Section
22 501(a) of the Internal Revenue Code.
23 (3) Special rule. For purposes of paragraph (2)
24 (A), "gross income" in the case of a life insurance
25 company, for tax years ending on and after December 31,
26 1994, shall mean the gross investment income for the
27 taxable year.
28 (c) Trusts and estates.
29 (1) In general. In the case of a trust or estate,
30 base income means an amount equal to the taxpayer's
31 taxable income for the taxable year as modified by
32 paragraph (2).
33 (2) Modifications. Subject to the provisions of
34 paragraph (3), the taxable income referred to in
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1 paragraph (1) shall be modified by adding thereto the sum
2 of the following amounts:
3 (A) An amount equal to all amounts paid or
4 accrued to the taxpayer as interest or dividends
5 during the taxable year to the extent excluded from
6 gross income in the computation of taxable income;
7 (B) In the case of (i) an estate, $600; (ii) a
8 trust which, under its governing instrument, is
9 required to distribute all of its income currently,
10 $300; and (iii) any other trust, $100, but in each
11 such case, only to the extent such amount was
12 deducted in the computation of taxable income;
13 (C) An amount equal to the amount of tax
14 imposed by this Act to the extent deducted from
15 gross income in the computation of taxable income
16 for the taxable year;
17 (D) The amount of any net operating loss
18 deduction taken in arriving at taxable income, other
19 than a net operating loss carried forward from a
20 taxable year ending prior to December 31, 1986;
21 (E) For taxable years in which a net operating
22 loss carryback or carryforward from a taxable year
23 ending prior to December 31, 1986 is an element of
24 taxable income under paragraph (1) of subsection (e)
25 or subparagraph (E) of paragraph (2) of subsection
26 (e), the amount by which addition modifications
27 other than those provided by this subparagraph (E)
28 exceeded subtraction modifications in such taxable
29 year, with the following limitations applied in the
30 order that they are listed:
31 (i) the addition modification relating to
32 the net operating loss carried back or forward
33 to the taxable year from any taxable year
34 ending prior to December 31, 1986 shall be
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1 reduced by the amount of addition modification
2 under this subparagraph (E) which related to
3 that net operating loss and which was taken
4 into account in calculating the base income of
5 an earlier taxable year, and
6 (ii) the addition modification relating
7 to the net operating loss carried back or
8 forward to the taxable year from any taxable
9 year ending prior to December 31, 1986 shall
10 not exceed the amount of such carryback or
11 carryforward;
12 For taxable years in which there is a net
13 operating loss carryback or carryforward from more
14 than one other taxable year ending prior to December
15 31, 1986, the addition modification provided in this
16 subparagraph (E) shall be the sum of the amounts
17 computed independently under the preceding
18 provisions of this subparagraph (E) for each such
19 taxable year;
20 (F) For taxable years ending on or after
21 January 1, 1989, an amount equal to the tax deducted
22 pursuant to Section 164 of the Internal Revenue Code
23 if the trust or estate is claiming the same tax for
24 purposes of the Illinois foreign tax credit under
25 Section 601 of this Act;
26 (G) An amount equal to the amount of the
27 capital gain deduction allowable under the Internal
28 Revenue Code, to the extent deducted from gross
29 income in the computation of taxable income; and
30 (G-5) For taxable years ending after December
31 31, 1997, an amount equal to any eligible
32 remediation costs that the trust or estate deducted
33 in computing adjusted gross income and for which the
34 trust or estate claims a credit under subsection (l)
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1 of Section 201;
2 and by deducting from the total so obtained the sum of
3 the following amounts:
4 (H) An amount equal to all amounts included in
5 such total pursuant to the provisions of Sections
6 402(a), 402(c), 403(a), 403(b), 406(a), 407(a) and
7 408 of the Internal Revenue Code or included in such
8 total as distributions under the provisions of any
9 retirement or disability plan for employees of any
10 governmental agency or unit, or retirement payments
11 to retired partners, which payments are excluded in
12 computing net earnings from self employment by
13 Section 1402 of the Internal Revenue Code and
14 regulations adopted pursuant thereto;
15 (I) The valuation limitation amount;
16 (J) An amount equal to the amount of any tax
17 imposed by this Act which was refunded to the
18 taxpayer and included in such total for the taxable
19 year;
20 (K) An amount equal to all amounts included in
21 taxable income as modified by subparagraphs (A),
22 (B), (C), (D), (E), (F) and (G) which are exempt
23 from taxation by this State either by reason of its
24 statutes or Constitution or by reason of the
25 Constitution, treaties or statutes of the United
26 States; provided that, in the case of any statute of
27 this State that exempts income derived from bonds or
28 other obligations from the tax imposed under this
29 Act, the amount exempted shall be the interest net
30 of bond premium amortization;
31 (L) With the exception of any amounts
32 subtracted under subparagraph (K), an amount equal
33 to the sum of all amounts disallowed as deductions
34 by (i) Sections 171(a) (2) and 265(a)(2) of the
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1 Internal Revenue Code, as now or hereafter amended,
2 and all amounts of expenses allocable to interest
3 and disallowed as deductions by Section 265(1) of
4 the Internal Revenue Code of 1954, as now or
5 hereafter amended; and (ii) for taxable years ending
6 on or after August 13, 1999 the effective date of
7 this amendatory Act of the 91st General Assembly,
8 Sections 171(a)(2), 265, 280C, and 832(b)(5)(B)(i)
9 of the Internal Revenue Code; the provisions of this
10 subparagraph are exempt from the provisions of
11 Section 250;
12 (M) An amount equal to those dividends
13 included in such total which were paid by a
14 corporation which conducts business operations in an
15 Enterprise Zone or zones created under the Illinois
16 Enterprise Zone Act and conducts substantially all
17 of its operations in an Enterprise Zone or Zones;
18 (N) An amount equal to any contribution made
19 to a job training project established pursuant to
20 the Tax Increment Allocation Redevelopment Act;
21 (O) An amount equal to those dividends
22 included in such total that were paid by a
23 corporation that conducts business operations in a
24 federally designated Foreign Trade Zone or Sub-Zone
25 and that is designated a High Impact Business
26 located in Illinois; provided that dividends
27 eligible for the deduction provided in subparagraph
28 (M) of paragraph (2) of this subsection shall not be
29 eligible for the deduction provided under this
30 subparagraph (O);
31 (P) An amount equal to the amount of the
32 deduction used to compute the federal income tax
33 credit for restoration of substantial amounts held
34 under claim of right for the taxable year pursuant
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1 to Section 1341 of the Internal Revenue Code of
2 1986; and
3 (Q) For taxable year 1999 and thereafter, an
4 amount equal to the amount of any (i) distributions,
5 to the extent includible in gross income for federal
6 income tax purposes, made to the taxpayer because of
7 his or her status as a victim of persecution for
8 racial or religious reasons by Nazi Germany or any
9 other Axis regime or as an heir of the victim and
10 (ii) items of income, to the extent includible in
11 gross income for federal income tax purposes,
12 attributable to, derived from or in any way related
13 to assets stolen from, hidden from, or otherwise
14 lost to a victim of persecution for racial or
15 religious reasons by Nazi Germany or any other Axis
16 regime immediately prior to, during, and immediately
17 after World War II, including, but not limited to,
18 interest on the proceeds receivable as insurance
19 under policies issued to a victim of persecution for
20 racial or religious reasons by Nazi Germany or any
21 other Axis regime by European insurance companies
22 immediately prior to and during World War II;
23 provided, however, this subtraction from federal
24 adjusted gross income does not apply to assets
25 acquired with such assets or with the proceeds from
26 the sale of such assets; provided, further, this
27 paragraph shall only apply to a taxpayer who was the
28 first recipient of such assets after their recovery
29 and who is a victim of persecution for racial or
30 religious reasons by Nazi Germany or any other Axis
31 regime or as an heir of the victim. The amount of
32 and the eligibility for any public assistance,
33 benefit, or similar entitlement is not affected by
34 the inclusion of items (i) and (ii) of this
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1 paragraph in gross income for federal income tax
2 purposes. This paragraph is exempt from the
3 provisions of Section 250.
4 (3) Limitation. The amount of any modification
5 otherwise required under this subsection shall, under
6 regulations prescribed by the Department, be adjusted by
7 any amounts included therein which were properly paid,
8 credited, or required to be distributed, or permanently
9 set aside for charitable purposes pursuant to Internal
10 Revenue Code Section 642(c) during the taxable year.
11 (d) Partnerships.
12 (1) In general. In the case of a partnership, base
13 income means an amount equal to the taxpayer's taxable
14 income for the taxable year as modified by paragraph (2).
15 (2) Modifications. The taxable income referred to
16 in paragraph (1) shall be modified by adding thereto the
17 sum of the following amounts:
18 (A) An amount equal to all amounts paid or
19 accrued to the taxpayer as interest or dividends
20 during the taxable year to the extent excluded from
21 gross income in the computation of taxable income;
22 (B) An amount equal to the amount of tax
23 imposed by this Act to the extent deducted from
24 gross income for the taxable year;
25 (C) The amount of deductions allowed to the
26 partnership pursuant to Section 707 (c) of the
27 Internal Revenue Code in calculating its taxable
28 income; and
29 (D) An amount equal to the amount of the
30 capital gain deduction allowable under the Internal
31 Revenue Code, to the extent deducted from gross
32 income in the computation of taxable income;
33 and by deducting from the total so obtained the following
34 amounts:
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1 (E) The valuation limitation amount;
2 (F) An amount equal to the amount of any tax
3 imposed by this Act which was refunded to the
4 taxpayer and included in such total for the taxable
5 year;
6 (G) An amount equal to all amounts included in
7 taxable income as modified by subparagraphs (A),
8 (B), (C) and (D) which are exempt from taxation by
9 this State either by reason of its statutes or
10 Constitution or by reason of the Constitution,
11 treaties or statutes of the United States; provided
12 that, in the case of any statute of this State that
13 exempts income derived from bonds or other
14 obligations from the tax imposed under this Act, the
15 amount exempted shall be the interest net of bond
16 premium amortization;
17 (H) Any income of the partnership which
18 constitutes personal service income as defined in
19 Section 1348 (b) (1) of the Internal Revenue Code
20 (as in effect December 31, 1981) or a reasonable
21 allowance for compensation paid or accrued for
22 services rendered by partners to the partnership,
23 whichever is greater;
24 (I) An amount equal to all amounts of income
25 distributable to an entity subject to the Personal
26 Property Tax Replacement Income Tax imposed by
27 subsections (c) and (d) of Section 201 of this Act
28 including amounts distributable to organizations
29 exempt from federal income tax by reason of Section
30 501(a) of the Internal Revenue Code;
31 (J) With the exception of any amounts
32 subtracted under subparagraph (G), an amount equal
33 to the sum of all amounts disallowed as deductions
34 by (i) Sections 171(a) (2), and 265(2) of the
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1 Internal Revenue Code of 1954, as now or hereafter
2 amended, and all amounts of expenses allocable to
3 interest and disallowed as deductions by Section
4 265(1) of the Internal Revenue Code, as now or
5 hereafter amended; and (ii) for taxable years ending
6 on or after August 13, 1999 the effective date of
7 this amendatory Act of the 91st General Assembly,
8 Sections 171(a)(2), 265, 280C, and 832(b)(5)(B)(i)
9 of the Internal Revenue Code; the provisions of this
10 subparagraph are exempt from the provisions of
11 Section 250;
12 (K) An amount equal to those dividends
13 included in such total which were paid by a
14 corporation which conducts business operations in an
15 Enterprise Zone or zones created under the Illinois
16 Enterprise Zone Act, enacted by the 82nd General
17 Assembly, and which does not conduct such operations
18 other than in an Enterprise Zone or Zones;
19 (L) An amount equal to any contribution made
20 to a job training project established pursuant to
21 the Real Property Tax Increment Allocation
22 Redevelopment Act;
23 (M) An amount equal to those dividends
24 included in such total that were paid by a
25 corporation that conducts business operations in a
26 federally designated Foreign Trade Zone or Sub-Zone
27 and that is designated a High Impact Business
28 located in Illinois; provided that dividends
29 eligible for the deduction provided in subparagraph
30 (K) of paragraph (2) of this subsection shall not be
31 eligible for the deduction provided under this
32 subparagraph (M); and
33 (N) An amount equal to the amount of the
34 deduction used to compute the federal income tax
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1 credit for restoration of substantial amounts held
2 under claim of right for the taxable year pursuant
3 to Section 1341 of the Internal Revenue Code of
4 1986.
5 (e) Gross income; adjusted gross income; taxable income.
6 (1) In general. Subject to the provisions of
7 paragraph (2) and subsection (b) (3), for purposes of
8 this Section and Section 803(e), a taxpayer's gross
9 income, adjusted gross income, or taxable income for the
10 taxable year shall mean the amount of gross income,
11 adjusted gross income or taxable income properly
12 reportable for federal income tax purposes for the
13 taxable year under the provisions of the Internal Revenue
14 Code. Taxable income may be less than zero. However, for
15 taxable years ending on or after December 31, 1986, net
16 operating loss carryforwards from taxable years ending
17 prior to December 31, 1986, may not exceed the sum of
18 federal taxable income for the taxable year before net
19 operating loss deduction, plus the excess of addition
20 modifications over subtraction modifications for the
21 taxable year. For taxable years ending prior to December
22 31, 1986, taxable income may never be an amount in excess
23 of the net operating loss for the taxable year as defined
24 in subsections (c) and (d) of Section 172 of the Internal
25 Revenue Code, provided that when taxable income of a
26 corporation (other than a Subchapter S corporation),
27 trust, or estate is less than zero and addition
28 modifications, other than those provided by subparagraph
29 (E) of paragraph (2) of subsection (b) for corporations
30 or subparagraph (E) of paragraph (2) of subsection (c)
31 for trusts and estates, exceed subtraction modifications,
32 an addition modification must be made under those
33 subparagraphs for any other taxable year to which the
34 taxable income less than zero (net operating loss) is
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1 applied under Section 172 of the Internal Revenue Code or
2 under subparagraph (E) of paragraph (2) of this
3 subsection (e) applied in conjunction with Section 172 of
4 the Internal Revenue Code.
5 (2) Special rule. For purposes of paragraph (1) of
6 this subsection, the taxable income properly reportable
7 for federal income tax purposes shall mean:
8 (A) Certain life insurance companies. In the
9 case of a life insurance company subject to the tax
10 imposed by Section 801 of the Internal Revenue Code,
11 life insurance company taxable income, plus the
12 amount of distribution from pre-1984 policyholder
13 surplus accounts as calculated under Section 815a of
14 the Internal Revenue Code;
15 (B) Certain other insurance companies. In the
16 case of mutual insurance companies subject to the
17 tax imposed by Section 831 of the Internal Revenue
18 Code, insurance company taxable income;
19 (C) Regulated investment companies. In the
20 case of a regulated investment company subject to
21 the tax imposed by Section 852 of the Internal
22 Revenue Code, investment company taxable income;
23 (D) Real estate investment trusts. In the
24 case of a real estate investment trust subject to
25 the tax imposed by Section 857 of the Internal
26 Revenue Code, real estate investment trust taxable
27 income;
28 (E) Consolidated corporations. In the case of
29 a corporation which is a member of an affiliated
30 group of corporations filing a consolidated income
31 tax return for the taxable year for federal income
32 tax purposes, taxable income determined as if such
33 corporation had filed a separate return for federal
34 income tax purposes for the taxable year and each
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1 preceding taxable year for which it was a member of
2 an affiliated group. For purposes of this
3 subparagraph, the taxpayer's separate taxable income
4 shall be determined as if the election provided by
5 Section 243(b) (2) of the Internal Revenue Code had
6 been in effect for all such years;
7 (F) Cooperatives. In the case of a
8 cooperative corporation or association, the taxable
9 income of such organization determined in accordance
10 with the provisions of Section 1381 through 1388 of
11 the Internal Revenue Code;
12 (G) Subchapter S corporations. In the case
13 of: (i) a Subchapter S corporation for which there
14 is in effect an election for the taxable year under
15 Section 1362 of the Internal Revenue Code, the
16 taxable income of such corporation determined in
17 accordance with Section 1363(b) of the Internal
18 Revenue Code, except that taxable income shall take
19 into account those items which are required by
20 Section 1363(b)(1) of the Internal Revenue Code to
21 be separately stated; and (ii) a Subchapter S
22 corporation for which there is in effect a federal
23 election to opt out of the provisions of the
24 Subchapter S Revision Act of 1982 and have applied
25 instead the prior federal Subchapter S rules as in
26 effect on July 1, 1982, the taxable income of such
27 corporation determined in accordance with the
28 federal Subchapter S rules as in effect on July 1,
29 1982; and
30 (H) Partnerships. In the case of a
31 partnership, taxable income determined in accordance
32 with Section 703 of the Internal Revenue Code,
33 except that taxable income shall take into account
34 those items which are required by Section 703(a)(1)
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1 to be separately stated but which would be taken
2 into account by an individual in calculating his
3 taxable income.
4 (f) Valuation limitation amount.
5 (1) In general. The valuation limitation amount
6 referred to in subsections (a) (2) (G), (c) (2) (I) and
7 (d)(2) (E) is an amount equal to:
8 (A) The sum of the pre-August 1, 1969
9 appreciation amounts (to the extent consisting of
10 gain reportable under the provisions of Section 1245
11 or 1250 of the Internal Revenue Code) for all
12 property in respect of which such gain was reported
13 for the taxable year; plus
14 (B) The lesser of (i) the sum of the
15 pre-August 1, 1969 appreciation amounts (to the
16 extent consisting of capital gain) for all property
17 in respect of which such gain was reported for
18 federal income tax purposes for the taxable year, or
19 (ii) the net capital gain for the taxable year,
20 reduced in either case by any amount of such gain
21 included in the amount determined under subsection
22 (a) (2) (F) or (c) (2) (H).
23 (2) Pre-August 1, 1969 appreciation amount.
24 (A) If the fair market value of property
25 referred to in paragraph (1) was readily
26 ascertainable on August 1, 1969, the pre-August 1,
27 1969 appreciation amount for such property is the
28 lesser of (i) the excess of such fair market value
29 over the taxpayer's basis (for determining gain) for
30 such property on that date (determined under the
31 Internal Revenue Code as in effect on that date), or
32 (ii) the total gain realized and reportable for
33 federal income tax purposes in respect of the sale,
34 exchange or other disposition of such property.
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1 (B) If the fair market value of property
2 referred to in paragraph (1) was not readily
3 ascertainable on August 1, 1969, the pre-August 1,
4 1969 appreciation amount for such property is that
5 amount which bears the same ratio to the total gain
6 reported in respect of the property for federal
7 income tax purposes for the taxable year, as the
8 number of full calendar months in that part of the
9 taxpayer's holding period for the property ending
10 July 31, 1969 bears to the number of full calendar
11 months in the taxpayer's entire holding period for
12 the property.
13 (C) The Department shall prescribe such
14 regulations as may be necessary to carry out the
15 purposes of this paragraph.
16 (g) Double deductions. Unless specifically provided
17 otherwise, nothing in this Section shall permit the same item
18 to be deducted more than once.
19 (h) Legislative intention. Except as expressly provided
20 by this Section there shall be no modifications or
21 limitations on the amounts of income, gain, loss or deduction
22 taken into account in determining gross income, adjusted
23 gross income or taxable income for federal income tax
24 purposes for the taxable year, or in the amount of such items
25 entering into the computation of base income and net income
26 under this Act for such taxable year, whether in respect of
27 property values as of August 1, 1969 or otherwise.
28 (Source: P.A. 90-491, eff. 1-1-98; 90-717, eff. 8-7-98;
29 90-770, eff. 8-14-98; 91-192, eff. 7-20-99; 91-205, eff.
30 7-20-99; 91-357, eff. 7-29-99; 91-541, eff. 8-13-99; 91-676,
31 eff. 12-23-99; revised 1-5-00.)
32 (35 ILCS 5/405)
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1 Sec. 405. Carryovers in certain acquisitions.
2 (a) In the case of the acquisition of assets of a
3 corporation by another corporation described in Section
4 381(a) of the Internal Revenue Code, the acquiring
5 corporation shall succeed to and take into account, as of the
6 close of the day of distribution or transfer, all Article 2
7 credits and net losses under Section 207 of the corporation
8 from which the assets were where acquired, without limitation
9 under Section 382 of the Internal Revenue Code or the
10 separate return limitation year regulations promulgated under
11 Section 1502 of the Internal Revenue Code.
12 (b) In the case of the acquisition of assets of a
13 partnership by another partnership in a transaction in which
14 the acquiring partnership is considered to be a continuation
15 of the partnership from which the assets were acquired under
16 the provisions of Section 708 of the Internal Revenue Code
17 and any regulations promulgated under that Section, the
18 acquiring partnership shall succeed to and take into account,
19 as of the close of the day of distribution or transfer, all
20 Article 2 credits and net losses under Section 207 of the
21 partnership from which the assets were acquired.
22 (b-5) No limitation under Section 382 of the Internal
23 Revenue Code or the separate return limitation year
24 regulations promulgated under Section 1502 of the Internal
25 Revenue Code shall apply to the carryover of any Article 2
26 credit or net loss allowable under Section 207.
27 (c) The provisions of this amendatory Act of the 91st
28 General Assembly shall apply to all acquisitions occurring in
29 taxable years ending on or after December 31, 1986; provided
30 that if a taxpayer's Illinois income tax liability for any
31 taxable year, as assessed under Section 903 prior to January
32 1, 1999, was computed without taking into account all of the
33 Article 2 credits and net losses under Section 207 as allowed
34 by this Section:
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1 (1) no refund shall be payable to the taxpayer for
2 that taxable year as the result of allowing any portion
3 of the Article 2 credits or net losses under Section 207
4 that were not taken into account in computing the tax
5 assessed prior to January 1, 1999;
6 (2) any deficiency which has not been paid may be
7 reduced (but not below zero) by the allowance of some or
8 all of the Article 2 credits or net losses under Section
9 207 that were not taken into account in computing the tax
10 assessed prior to January 1, 1999; and
11 (3) in the case of any Article 2 credit or net loss
12 under Section 207 that, pursuant to this subsection (c),
13 could not be taken into account either in computing the
14 tax assessed prior to January 1, 1999 for a taxable year
15 or in reducing a deficiency for that taxable year under
16 paragraph (2) of subsection (c), the allowance of such
17 credit or loss in any other taxable year shall not be
18 denied on the grounds that such credit or loss should
19 properly have been claimed in that taxable year under
20 subsection (a) or (b).
21 (Source: P.A. 91-541, eff. 8-13-99.)
22 (35 ILCS 5/803) (from Ch. 120, par. 8-803)
23 Sec. 803. Payment of Estimated Tax.
24 (a) Every taxpayer other than an estate, trust,
25 partnership, Subchapter S corporation or farmer is required
26 to pay estimated tax for the taxable year, in such amount and
27 with such forms as the Department shall prescribe, if the
28 amount payable as estimated tax can reasonably be expected to
29 be more than (i) $250 for taxable years ending before
30 December 31, 2001 and $500 for taxable years ending on or
31 after December 31, 2001 or (ii) $400 for corporations.
32 (b) Estimated tax defined. The term "estimated tax"
33 means the excess of:
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1 (1) The amount which the taxpayer estimates to be his
2 tax under this Act for the taxable year, over
3 (2) The amount which he estimates to be the sum of any
4 amounts to be withheld on account of or credited against such
5 tax.
6 (c) Joint payment. If they are eligible to do so for
7 federal tax purposes, a husband and wife may pay estimated
8 tax as if they were one taxpayer, in which case the liability
9 with respect to the estimated tax shall be joint and several.
10 If a joint payment is made but the husband and wife elect to
11 determine their taxes under this Act separately, the
12 estimated tax for such year may be treated as the estimated
13 tax of either husband or wife, or may be divided between
14 them, as they may elect.
15 (d) There shall be paid 4 equal installments of
16 estimated tax for each taxable year, payable as follows:
17 Required Installment: Due Date:
18 1st April 15
19 2nd June 15
20 3rd September 15
21 4th Individuals: January 15 of the
22 following taxable year
23 Corporations: December 15
24 (e) Farmers. An individual, having gross income from
25 farming for the taxable year which is at least 2/3 of his
26 total estimated gross income for such year.
27 (f) Application to short taxable years. The application
28 of this section to taxable years of less than 12 months shall
29 be in accordance with regulations prescribed by the
30 Department.
31 (g) Fiscal years. In the application of this section to
32 the case of a taxable year beginning on any date other than
33 January 1, there shall be substituted, for the months
34 specified in subsections (d) and (e), the months which
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1 correspond thereto.
2 (h) Installments paid in advance. Any installment of
3 estimated tax may be paid before the date prescribed for its
4 payment.
5 The changes in this Section made by this amendatory Act
6 of 1985 shall apply to taxable years ending on or after
7 January 1, 1986.
8 (Source: P.A. 86-678.)
9 (35 ILCS 5/1501) (from Ch. 120, par. 15-1501)
10 Sec. 1501. Definitions.
11 (a) In general. When used in this Act, where not
12 otherwise distinctly expressed or manifestly incompatible
13 with the intent thereof:
14 (1) Business income. The term "business income"
15 means income arising from transactions and activity in
16 the regular course of the taxpayer's trade or business,
17 net of the deductions allocable thereto, and includes
18 income from tangible and intangible property if the
19 acquisition, management, and disposition of the property
20 constitute integral parts of the taxpayer's regular trade
21 or business operations. Such term does not include
22 compensation or the deductions allocable thereto.
23 (2) Commercial domicile. The term "commercial
24 domicile" means the principal place from which the trade
25 or business of the taxpayer is directed or managed.
26 (3) Compensation. The term "compensation" means
27 wages, salaries, commissions and any other form of
28 remuneration paid to employees for personal services.
29 (4) Corporation. The term "corporation" includes
30 associations, joint-stock companies, insurance companies
31 and cooperatives. Any entity, including a limited
32 liability company formed under the Illinois Limited
33 Liability Company Act, shall be treated as a corporation
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1 if it is so classified for federal income tax purposes.
2 (5) Department. The term "Department" means the
3 Department of Revenue of this State.
4 (6) Director. The term "Director" means the
5 Director of Revenue of this State.
6 (7) Fiduciary. The term "fiduciary" means a
7 guardian, trustee, executor, administrator, receiver, or
8 any person acting in any fiduciary capacity for any
9 person.
10 (8) Financial organization.
11 (A) The term "financial organization" means
12 any bank, bank holding company, trust company,
13 savings bank, industrial bank, land bank, safe
14 deposit company, private banker, savings and loan
15 association, building and loan association, credit
16 union, currency exchange, cooperative bank, small
17 loan company, sales finance company, investment
18 company, or any person which is owned by a bank or
19 bank holding company. For the purpose of this
20 Section a "person" will include only those persons
21 which a bank holding company may acquire and hold an
22 interest in, directly or indirectly, under the
23 provisions of the Bank Holding Company Act of 1956
24 (12 U.S.C. 1841, et seq.), except where interests in
25 any person must be disposed of within certain
26 required time limits under the Bank Holding Company
27 Act of 1956.
28 (B) For purposes of subparagraph (A) of this
29 paragraph, the term "bank" includes (i) any entity
30 that is regulated by the Comptroller of the Currency
31 under the National Bank Act, or by the Federal
32 Reserve Board, or by the Federal Deposit Insurance
33 Corporation and (ii) any federally or State
34 chartered bank operating as a credit card bank.
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1 (C) For purposes of subparagraph (A) of this
2 paragraph, the term "sales finance company" has the
3 meaning provided in the following item (i) or (ii):
4 (i) A person primarily engaged in one or
5 more of the following businesses: the business
6 of purchasing customer receivables, the
7 business of making loans upon the security of
8 customer receivables, the business of making
9 loans for the express purpose of funding
10 purchases of tangible personal property or
11 services by the borrower, or the business of
12 finance leasing. For purposes of this item
13 (i), "customer receivable" means:
14 (a) a retail installment contract or
15 retail charge agreement within the meaning of
16 the Sales Finance Agency Act, the Retail
17 Installment Sales Act, or the Motor Vehicle
18 Retail Installment Sales Act;
19 (b) an installment, charge, credit, or
20 similar contract or agreement arising from the
21 sale of tangible personal property or services
22 in a transaction involving a deferred payment
23 price payable in one or more installments
24 subsequent to the sale; or
25 (c) the outstanding balance of a contract
26 or agreement described in provisions (a) or (b)
27 of this item (i).
28 A customer receivable need not provide for
29 payment of interest on deferred payments. A sales
30 finance company may purchase a customer receivable
31 from, or make a loan secured by a customer
32 receivable to, the seller in the original
33 transaction or to a person who purchased the
34 customer receivable directly or indirectly from that
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1 seller.
2 (ii) A corporation meeting each of the
3 following criteria:
4 (a) the corporation must be a member of
5 an "affiliated group" within the meaning of
6 Section 1504(a) of the Internal Revenue Code,
7 determined without regard to Section 1504(b) of
8 the Internal Revenue Code;
9 (b) more than 50% of the gross income of
10 the corporation for the taxable year must be
11 interest income derived from qualifying loans.
12 A "qualifying loan" is a loan made to a member
13 of the corporation's affiliated group that
14 originates customer receivables (within the
15 meaning of item (i)) or to whom customer
16 receivables originated by a member of the
17 affiliated group have been transferred, to the
18 extent the average outstanding balance of loans
19 from that corporation to members of its
20 affiliated group during the taxable year do not
21 exceed the limitation amount for that
22 corporation. The "limitation amount" for a
23 corporation is the average outstanding balances
24 during the taxable year of customer receivables
25 (within the meaning of item (i)) originated by
26 all members of the affiliated group. If the
27 average outstanding balances of the loans made
28 by a corporation to members of its affiliated
29 group exceed the limitation amount, the
30 interest income of that corporation from
31 qualifying loans shall be equal to its interest
32 income from loans to members of its affiliated
33 groups times a fraction equal to the limitation
34 amount divided by the average outstanding
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1 balances of the loans made by that corporation
2 to members of its affiliated group;
3 (c) the total of all shareholder's equity
4 (including, without limitation, paid-in capital
5 on common and preferred stock and retained
6 earnings) of the corporation plus the total of
7 all of its loans, advances, and other
8 obligations payable or owed to members of its
9 affiliated group may not exceed 20% of the
10 total assets of the corporation at any time
11 during the tax year; and
12 (d) more than 50% of all interest-bearing
13 obligations of the affiliated group payable to
14 persons outside the group determined in
15 accordance with generally accepted accounting
16 principles must be obligations of the
17 corporation.
18 This amendatory Act of the 91st General Assembly is
19 declaratory of existing law.
20 (D) Subparagraphs (B) and (C) of this
21 paragraph are declaratory of existing law and apply
22 retroactively, for all tax years beginning on or
23 before December 31, 1996, to all original returns,
24 to all amended returns filed no later than 30 days
25 after the effective date of this amendatory Act of
26 1996, and to all notices issued on or before the
27 effective date of this amendatory Act of 1996 under
28 subsection (a) of Section 903, subsection (a) of
29 Section 904, subsection (e) of Section 909, or
30 Section 912. A taxpayer that is a "financial
31 organization" that engages in any transaction with
32 an affiliate shall be a "financial organization" for
33 all purposes of this Act.
34 (E) For all tax years beginning on or before
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1 December 31, 1996, a taxpayer that falls within the
2 definition of a "financial organization" under
3 subparagraphs (B) or (C) of this paragraph, but who
4 does not fall within the definition of a "financial
5 organization" under the Proposed Regulations issued
6 by the Department of Revenue on July 19, 1996, may
7 irrevocably elect to apply the Proposed Regulations
8 for all of those years as though the Proposed
9 Regulations had been lawfully promulgated, adopted,
10 and in effect for all of those years. For purposes
11 of applying subparagraphs (B) or (C) of this
12 paragraph to all of those years, the election
13 allowed by this subparagraph applies only to the
14 taxpayer making the election and to those members of
15 the taxpayer's unitary business group who are
16 ordinarily required to apportion business income
17 under the same subsection of Section 304 of this Act
18 as the taxpayer making the election. No election
19 allowed by this subparagraph shall be made under a
20 claim filed under subsection (d) of Section 909 more
21 than 30 days after the effective date of this
22 amendatory Act of 1996.
23 (F) Finance Leases. For purposes of this
24 subsection, a finance lease shall be treated as a
25 loan or other extension of credit, rather than as a
26 lease, regardless of how the transaction is
27 characterized for any other purpose, including the
28 purposes of any regulatory agency to which the
29 lessor is subject. A finance lease is any
30 transaction in the form of a lease in which the
31 lessee is treated as the owner of the leased asset
32 entitled to any deduction for depreciation allowed
33 under Section 167 of the Internal Revenue Code.
34 (9) Fiscal year. The term "fiscal year" means an
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1 accounting period of 12 months ending on the last day of
2 any month other than December.
3 (10) Includes and including. The terms "includes"
4 and "including" when used in a definition contained in
5 this Act shall not be deemed to exclude other things
6 otherwise within the meaning of the term defined.
7 (11) Internal Revenue Code. The term "Internal
8 Revenue Code" means the United States Internal Revenue
9 Code of 1954 or any successor law or laws relating to
10 federal income taxes in effect for the taxable year.
11 (12) Mathematical error. The term "mathematical
12 error" includes the following types of errors, omissions,
13 or defects in a return filed by a taxpayer which prevents
14 acceptance of the return as filed for processing:
15 (A) arithmetic errors or incorrect
16 computations on the return or supporting schedules;
17 (B) entries on the wrong lines;
18 (C) omission of required supporting forms or
19 schedules or the omission of the information in
20 whole or in part called for thereon; and
21 (D) an attempt to claim, exclude, deduct, or
22 improperly report, in a manner directly contrary to
23 the provisions of the Act and regulations thereunder
24 any item of income, exemption, deduction, or credit.
25 (13) Nonbusiness income. The term "nonbusiness
26 income" means all income other than business income or
27 compensation.
28 (14) Nonresident. The term "nonresident" means a
29 person who is not a resident.
30 (15) Paid, incurred and accrued. The terms "paid",
31 "incurred" and "accrued" shall be construed according to
32 the method of accounting upon the basis of which the
33 person's base income is computed under this Act.
34 (16) Partnership and partner. The term
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1 "partnership" includes a syndicate, group, pool, joint
2 venture or other unincorporated organization, through or
3 by means of which any business, financial operation, or
4 venture is carried on, and which is not, within the
5 meaning of this Act, a trust or estate or a corporation;
6 and the term "partner" includes a member in such
7 syndicate, group, pool, joint venture or organization.
8 The term "partnership" includes any entity,
9 including a limited liability company formed under the
10 Illinois Limited Liability Company Act, shall be treated
11 as a partnership if it is so classified as a partnership
12 for federal income tax purposes.
13 For purposes of the tax imposed at subsection (c) of
14 Section 201 of this Act, The term "partnership" does not
15 include a syndicate, group, pool, joint venture, or other
16 unincorporated organization established for the sole
17 purpose of playing the Illinois State Lottery or any
18 entity that is excluded from the application of
19 Subchapter K of the Internal Revenue Code pursuant to an
20 election under Section 761(a) of the Internal Revenue
21 Code.
22 (17) Part-year resident. The term "part-year
23 resident" means an individual who became a resident
24 during the taxable year or ceased to be a resident during
25 the taxable year. Under Section 1501 (a) (20) (A) (i)
26 residence commences with presence in this State for other
27 than a temporary or transitory purpose and ceases with
28 absence from this State for other than a temporary or
29 transitory purpose. Under Section 1501 (a) (20) (A) (ii)
30 residence commences with the establishment of domicile in
31 this State and ceases with the establishment of domicile
32 in another State.
33 (18) Person. The term "person" shall be construed
34 to mean and include an individual, a trust, estate,
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1 partnership, association, firm, company, corporation,
2 limited liability company, or fiduciary. For purposes of
3 Section 1301 and 1302 of this Act, a "person" means (i)
4 an individual, (ii) a corporation, (iii) an officer,
5 agent, or employee of a corporation, (iv) a member, agent
6 or employee of a partnership, or (v) a member, manager,
7 employee, officer, director, or agent of a limited
8 liability company who in such capacity commits an offense
9 specified in Section 1301 and 1302.
10 (18A) Records. The term "records" includes all
11 data maintained by the taxpayer, whether on paper,
12 microfilm, microfiche, or any type of machine-sensible
13 data compilation.
14 (19) Regulations. The term "regulations" includes
15 rules promulgated and forms prescribed by the Department.
16 (20) Resident. The term "resident" means:
17 (A) an individual (i) who is in this State for
18 other than a temporary or transitory purpose during
19 the taxable year; or (ii) who is domiciled in this
20 State but is absent from the State for a temporary
21 or transitory purpose during the taxable year;
22 (B) The estate of a decedent who at his or her
23 death was domiciled in this State;
24 (C) A trust created by a will of a decedent
25 who at his death was domiciled in this State; and
26 (D) An irrevocable trust, the grantor of which
27 was domiciled in this State at the time such trust
28 became irrevocable. For purpose of this
29 subparagraph, a trust shall be considered
30 irrevocable to the extent that the grantor is not
31 treated as the owner thereof under Sections 671
32 through 678 of the Internal Revenue Code.
33 (21) Sales. The term "sales" means all gross
34 receipts of the taxpayer not allocated under Sections
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1 301, 302 and 303.
2 (22) State. The term "state" when applied to a
3 jurisdiction other than this State means any state of the
4 United States, the District of Columbia, the Commonwealth
5 of Puerto Rico, any Territory or Possession of the United
6 States, and any foreign country, or any political
7 subdivision of any of the foregoing. For purposes of the
8 foreign tax credit under Section 601, the term "state"
9 means any state of the United States, the District of
10 Columbia, the Commonwealth of Puerto Rico, and any
11 territory or possession of the United States, or any
12 political subdivision of any of the foregoing, effective
13 for tax years ending on or after December 31, 1989.
14 (23) Taxable year. The term "taxable year" means
15 the calendar year, or the fiscal year ending during such
16 calendar year, upon the basis of which the base income is
17 computed under this Act. "Taxable year" means, in the
18 case of a return made for a fractional part of a year
19 under the provisions of this Act, the period for which
20 such return is made.
21 (24) Taxpayer. The term "taxpayer" means any person
22 subject to the tax imposed by this Act.
23 (25) International banking facility. The term
24 international banking facility shall have the same
25 meaning as is set forth in the Illinois Banking Act or as
26 is set forth in the laws of the United States or
27 regulations of the Board of Governors of the Federal
28 Reserve System.
29 (26) Income Tax Return Preparer.
30 (A) The term "income tax return preparer"
31 means any person who prepares for compensation, or
32 who employs one or more persons to prepare for
33 compensation, any return of tax imposed by this Act
34 or any claim for refund of tax imposed by this Act.
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1 The preparation of a substantial portion of a return
2 or claim for refund shall be treated as the
3 preparation of that return or claim for refund.
4 (B) A person is not an income tax return
5 preparer if all he or she does is
6 (i) furnish typing, reproducing, or other
7 mechanical assistance;
8 (ii) prepare returns or claims for
9 refunds for the employer by whom he or she is
10 regularly and continuously employed;
11 (iii) prepare as a fiduciary returns or
12 claims for refunds for any person; or
13 (iv) prepare claims for refunds for a
14 taxpayer in response to any notice of
15 deficiency issued to that taxpayer or in
16 response to any waiver of restriction after the
17 commencement of an audit of that taxpayer or of
18 another taxpayer if a determination in the
19 audit of the other taxpayer directly or
20 indirectly affects the tax liability of the
21 taxpayer whose claims he or she is preparing.
22 (27) Unitary business group. The term "unitary
23 business group" means a group of persons related through
24 common ownership whose business activities are integrated
25 with, dependent upon and contribute to each other. The
26 group will not include those members whose business
27 activity outside the United States is 80% or more of any
28 such member's total business activity; for purposes of
29 this paragraph and clause (a) (3) (B) (ii) of Section
30 304, business activity within the United States shall be
31 measured by means of the factors ordinarily applicable
32 under subsections (a), (b), (c), (d), or (h) of Section
33 304 except that, in the case of members ordinarily
34 required to apportion business income by means of the 3
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1 factor formula of property, payroll and sales specified
2 in subsection (a) of Section 304, including the formula
3 as weighted in subsection (h) of Section 304, such
4 members shall not use the sales factor in the computation
5 and the results of the property and payroll factor
6 computations of subsection (a) of Section 304 shall be
7 divided by 2 (by one if either the property or payroll
8 factor has a denominator of zero). The computation
9 required by the preceding sentence shall, in each case,
10 involve the division of the member's property, payroll,
11 or revenue miles in the United States, insurance premiums
12 on property or risk in the United States, or financial
13 organization business income from sources within the
14 United States, as the case may be, by the respective
15 worldwide figures for such items. Common ownership in
16 the case of corporations is the direct or indirect
17 control or ownership of more than 50% of the outstanding
18 voting stock of the persons carrying on unitary business
19 activity. Unitary business activity can ordinarily be
20 illustrated where the activities of the members are: (1)
21 in the same general line (such as manufacturing,
22 wholesaling, retailing of tangible personal property,
23 insurance, transportation or finance); or (2) are steps
24 in a vertically structured enterprise or process (such as
25 the steps involved in the production of natural
26 resources, which might include exploration, mining,
27 refining, and marketing); and, in either instance, the
28 members are functionally integrated through the exercise
29 of strong centralized management (where, for example,
30 authority over such matters as purchasing, financing, tax
31 compliance, product line, personnel, marketing and
32 capital investment is not left to each member). In no
33 event, however, will any unitary business group include
34 members which are ordinarily required to apportion
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1 business income under different subsections of Section
2 304 except that for tax years ending on or after December
3 31, 1987 this prohibition shall not apply to a unitary
4 business group composed of one or more taxpayers all of
5 which apportion business income pursuant to subsection
6 (b) of Section 304, or all of which apportion business
7 income pursuant to subsection (d) of Section 304, and a
8 holding company of such single-factor taxpayers (see
9 definition of "financial organization" for rule regarding
10 holding companies of financial organizations). If a
11 unitary business group would, but for the preceding
12 sentence, include members that are ordinarily required to
13 apportion business income under different subsections of
14 Section 304, then for each subsection of Section 304 for
15 which there are two or more members, there shall be a
16 separate unitary business group composed of such members.
17 For purposes of the preceding two sentences, a member is
18 "ordinarily required to apportion business income" under
19 a particular subsection of Section 304 if it would be
20 required to use the apportionment method prescribed by
21 such subsection except for the fact that it derives
22 business income solely from Illinois. If the unitary
23 business group members' accounting periods differ, the
24 common parent's accounting period or, if there is no
25 common parent, the accounting period of the member that
26 is expected to have, on a recurring basis, the greatest
27 Illinois income tax liability must be used to determine
28 whether to use the apportionment method provided in
29 subsection (a) or subsection (h) of Section 304. The
30 prohibition against membership in a unitary business
31 group for taxpayers ordinarily required to apportion
32 income under different subsections of Section 304 does
33 not apply to taxpayers required to apportion income under
34 subsection (a) and subsection (h) of Section 304. The
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1 provisions of this amendatory Act of 1998 apply to tax
2 years ending on or after December 31, 1998.
3 (28) Subchapter S corporation. The term
4 "Subchapter S corporation" means a corporation for which
5 there is in effect an election under Section 1362 of the
6 Internal Revenue Code, or for which there is a federal
7 election to opt out of the provisions of the Subchapter S
8 Revision Act of 1982 and have applied instead the prior
9 federal Subchapter S rules as in effect on July 1, 1982.
10 (b) Other definitions.
11 (1) Words denoting number, gender, and so forth,
12 when used in this Act, where not otherwise distinctly
13 expressed or manifestly incompatible with the intent
14 thereof:
15 (A) Words importing the singular include and
16 apply to several persons, parties or things;
17 (B) Words importing the plural include the
18 singular; and
19 (C) Words importing the masculine gender
20 include the feminine as well.
21 (2) "Company" or "association" as including
22 successors and assigns. The word "company" or
23 "association", when used in reference to a corporation,
24 shall be deemed to embrace the words "successors and
25 assigns of such company or association", and in like
26 manner as if these last-named words, or words of similar
27 import, were expressed.
28 (3) Other terms. Any term used in any Section of
29 this Act with respect to the application of, or in
30 connection with, the provisions of any other Section of
31 this Act shall have the same meaning as in such other
32 Section.
33 (Source: P.A. 90-613, eff. 7-9-98; 91-535, eff. 1-1-00)
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1 Section 10. The Use Tax Act is amended by changing
2 Sections 3-5, 3-70, 9, 10, and 22 as follows:
3 (35 ILCS 105/3-5) (from Ch. 120, par. 439.3-5)
4 Sec. 3-5. Exemptions. Use of the following tangible
5 personal property is exempt from the tax imposed by this Act:
6 (1) Personal property purchased from a corporation,
7 society, association, foundation, institution, or
8 organization, other than a limited liability company, that is
9 organized and operated as a not-for-profit service enterprise
10 for the benefit of persons 65 years of age or older if the
11 personal property was not purchased by the enterprise for the
12 purpose of resale by the enterprise.
13 (2) Personal property purchased by a not-for-profit
14 Illinois county fair association for use in conducting,
15 operating, or promoting the county fair.
16 (3) Personal property purchased by a not-for-profit arts
17 or cultural organization that establishes, by proof required
18 by the Department by rule, that it has received an exemption
19 under Section 501(c)(3) of the Internal Revenue Code and that
20 is organized and operated for the presentation or support of
21 arts or cultural programming, activities, or services. These
22 organizations include, but are not limited to, music and
23 dramatic arts organizations such as symphony orchestras and
24 theatrical groups, arts and cultural service organizations,
25 local arts councils, visual arts organizations, and media
26 arts organizations.
27 (4) Personal property purchased by a governmental body,
28 by a corporation, society, association, foundation, or
29 institution organized and operated exclusively for
30 charitable, religious, or educational purposes, or by a
31 not-for-profit corporation, society, association, foundation,
32 institution, or organization that has no compensated officers
33 or employees and that is organized and operated primarily for
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1 the recreation of persons 55 years of age or older. A limited
2 liability company may qualify for the exemption under this
3 paragraph only if the limited liability company is organized
4 and operated exclusively for educational purposes. On and
5 after July 1, 1987, however, no entity otherwise eligible for
6 this exemption shall make tax-free purchases unless it has an
7 active exemption identification number issued by the
8 Department.
9 (5) A passenger car that is a replacement vehicle to the
10 extent that the purchase price of the car is subject to the
11 Replacement Vehicle Tax.
12 (6) Graphic arts machinery and equipment, including
13 repair and replacement parts, both new and used, and
14 including that manufactured on special order, certified by
15 the purchaser to be used primarily for graphic arts
16 production, and including machinery and equipment purchased
17 for lease.
18 (7) Farm chemicals.
19 (8) Legal tender, currency, medallions, or gold or
20 silver coinage issued by the State of Illinois, the
21 government of the United States of America, or the government
22 of any foreign country, and bullion.
23 (9) Personal property purchased from a teacher-sponsored
24 student organization affiliated with an elementary or
25 secondary school located in Illinois.
26 (10) A motor vehicle of the first division, a motor
27 vehicle of the second division that is a self-contained motor
28 vehicle designed or permanently converted to provide living
29 quarters for recreational, camping, or travel use, with
30 direct walk through to the living quarters from the driver's
31 seat, or a motor vehicle of the second division that is of
32 the van configuration designed for the transportation of not
33 less than 7 nor more than 16 passengers, as defined in
34 Section 1-146 of the Illinois Vehicle Code, that is used for
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1 automobile renting, as defined in the Automobile Renting
2 Occupation and Use Tax Act.
3 (11) Farm machinery and equipment, both new and used,
4 including that manufactured on special order, certified by
5 the purchaser to be used primarily for production agriculture
6 or State or federal agricultural programs, including
7 individual replacement parts for the machinery and equipment,
8 including machinery and equipment purchased for lease, and
9 including implements of husbandry defined in Section 1-130 of
10 the Illinois Vehicle Code, farm machinery and agricultural
11 chemical and fertilizer spreaders, and nurse wagons required
12 to be registered under Section 3-809 of the Illinois Vehicle
13 Code, but excluding other motor vehicles required to be
14 registered under the Illinois Vehicle Code. Horticultural
15 polyhouses or hoop houses used for propagating, growing, or
16 overwintering plants shall be considered farm machinery and
17 equipment under this item (11). Agricultural chemical tender
18 tanks and dry boxes shall include units sold separately from
19 a motor vehicle required to be licensed and units sold
20 mounted on a motor vehicle required to be licensed if the
21 selling price of the tender is separately stated.
22 Farm machinery and equipment shall include precision
23 farming equipment that is installed or purchased to be
24 installed on farm machinery and equipment including, but not
25 limited to, tractors, harvesters, sprayers, planters,
26 seeders, or spreaders. Precision farming equipment includes,
27 but is not limited to, soil testing sensors, computers,
28 monitors, software, global positioning and mapping systems,
29 and other such equipment.
30 Farm machinery and equipment also includes computers,
31 sensors, software, and related equipment used primarily in
32 the computer-assisted operation of production agriculture
33 facilities, equipment, and activities such as, but not
34 limited to, the collection, monitoring, and correlation of
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1 animal and crop data for the purpose of formulating animal
2 diets and agricultural chemicals. This item (11) is exempt
3 from the provisions of Section 3-90.
4 (12) Fuel and petroleum products sold to or used by an
5 air common carrier, certified by the carrier to be used for
6 consumption, shipment, or storage in the conduct of its
7 business as an air common carrier, for a flight destined for
8 or returning from a location or locations outside the United
9 States without regard to previous or subsequent domestic
10 stopovers.
11 (13) Proceeds of mandatory service charges separately
12 stated on customers' bills for the purchase and consumption
13 of food and beverages purchased at retail from a retailer, to
14 the extent that the proceeds of the service charge are in
15 fact turned over as tips or as a substitute for tips to the
16 employees who participate directly in preparing, serving,
17 hosting or cleaning up the food or beverage function with
18 respect to which the service charge is imposed.
19 (14) Oil field exploration, drilling, and production
20 equipment, including (i) rigs and parts of rigs, rotary rigs,
21 cable tool rigs, and workover rigs, (ii) pipe and tubular
22 goods, including casing and drill strings, (iii) pumps and
23 pump-jack units, (iv) storage tanks and flow lines, (v) any
24 individual replacement part for oil field exploration,
25 drilling, and production equipment, and (vi) machinery and
26 equipment purchased for lease; but excluding motor vehicles
27 required to be registered under the Illinois Vehicle Code.
28 (15) Photoprocessing machinery and equipment, including
29 repair and replacement parts, both new and used, including
30 that manufactured on special order, certified by the
31 purchaser to be used primarily for photoprocessing, and
32 including photoprocessing machinery and equipment purchased
33 for lease.
34 (16) Coal exploration, mining, offhighway hauling,
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1 processing, maintenance, and reclamation equipment, including
2 replacement parts and equipment, and including equipment
3 purchased for lease, but excluding motor vehicles required to
4 be registered under the Illinois Vehicle Code.
5 (17) Distillation machinery and equipment, sold as a
6 unit or kit, assembled or installed by the retailer,
7 certified by the user to be used only for the production of
8 ethyl alcohol that will be used for consumption as motor fuel
9 or as a component of motor fuel for the personal use of the
10 user, and not subject to sale or resale.
11 (18) Manufacturing and assembling machinery and
12 equipment used primarily in the process of manufacturing or
13 assembling tangible personal property for wholesale or retail
14 sale or lease, whether that sale or lease is made directly by
15 the manufacturer or by some other person, whether the
16 materials used in the process are owned by the manufacturer
17 or some other person, or whether that sale or lease is made
18 apart from or as an incident to the seller's engaging in the
19 service occupation of producing machines, tools, dies, jigs,
20 patterns, gauges, or other similar items of no commercial
21 value on special order for a particular purchaser.
22 (19) Personal property delivered to a purchaser or
23 purchaser's donee inside Illinois when the purchase order for
24 that personal property was received by a florist located
25 outside Illinois who has a florist located inside Illinois
26 deliver the personal property.
27 (20) Semen used for artificial insemination of livestock
28 for direct agricultural production.
29 (21) Horses, or interests in horses, registered with and
30 meeting the requirements of any of the Arabian Horse Club
31 Registry of America, Appaloosa Horse Club, American Quarter
32 Horse Association, United States Trotting Association, or
33 Jockey Club, as appropriate, used for purposes of breeding or
34 racing for prizes.
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1 (22) Computers and communications equipment utilized for
2 any hospital purpose and equipment used in the diagnosis,
3 analysis, or treatment of hospital patients purchased by a
4 lessor who leases the equipment, under a lease of one year or
5 longer executed or in effect at the time the lessor would
6 otherwise be subject to the tax imposed by this Act, to a
7 hospital that has been issued an active tax exemption
8 identification number by the Department under Section 1g of
9 the Retailers' Occupation Tax Act. If the equipment is
10 leased in a manner that does not qualify for this exemption
11 or is used in any other non-exempt manner, the lessor shall
12 be liable for the tax imposed under this Act or the Service
13 Use Tax Act, as the case may be, based on the fair market
14 value of the property at the time the non-qualifying use
15 occurs. No lessor shall collect or attempt to collect an
16 amount (however designated) that purports to reimburse that
17 lessor for the tax imposed by this Act or the Service Use Tax
18 Act, as the case may be, if the tax has not been paid by the
19 lessor. If a lessor improperly collects any such amount from
20 the lessee, the lessee shall have a legal right to claim a
21 refund of that amount from the lessor. If, however, that
22 amount is not refunded to the lessee for any reason, the
23 lessor is liable to pay that amount to the Department.
24 (23) Personal property purchased by a lessor who leases
25 the property, under a lease of one year or longer executed
26 or in effect at the time the lessor would otherwise be
27 subject to the tax imposed by this Act, to a governmental
28 body that has been issued an active sales tax exemption
29 identification number by the Department under Section 1g of
30 the Retailers' Occupation Tax Act. If the property is leased
31 in a manner that does not qualify for this exemption or used
32 in any other non-exempt manner, the lessor shall be liable
33 for the tax imposed under this Act or the Service Use Tax
34 Act, as the case may be, based on the fair market value of
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1 the property at the time the non-qualifying use occurs. No
2 lessor shall collect or attempt to collect an amount (however
3 designated) that purports to reimburse that lessor for the
4 tax imposed by this Act or the Service Use Tax Act, as the
5 case may be, if the tax has not been paid by the lessor. If
6 a lessor improperly collects any such amount from the lessee,
7 the lessee shall have a legal right to claim a refund of that
8 amount from the lessor. If, however, that amount is not
9 refunded to the lessee for any reason, the lessor is liable
10 to pay that amount to the Department.
11 (24) Beginning with taxable years ending on or after
12 December 31, 1995 and ending with taxable years ending on or
13 before December 31, 2004, personal property that is donated
14 for disaster relief to be used in a State or federally
15 declared disaster area in Illinois or bordering Illinois by a
16 manufacturer or retailer that is registered in this State to
17 a corporation, society, association, foundation, or
18 institution that has been issued a sales tax exemption
19 identification number by the Department that assists victims
20 of the disaster who reside within the declared disaster area.
21 (25) Beginning with taxable years ending on or after
22 December 31, 1995 and ending with taxable years ending on or
23 before December 31, 2004, personal property that is used in
24 the performance of infrastructure repairs in this State,
25 including but not limited to municipal roads and streets,
26 access roads, bridges, sidewalks, waste disposal systems,
27 water and sewer line extensions, water distribution and
28 purification facilities, storm water drainage and retention
29 facilities, and sewage treatment facilities, resulting from a
30 State or federally declared disaster in Illinois or bordering
31 Illinois when such repairs are initiated on facilities
32 located in the declared disaster area within 6 months after
33 the disaster.
34 (26) Beginning July 1, 1999, game or game birds
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1 purchased at a "game breeding and hunting preserve area" or
2 an "exotic game hunting area" as those terms are used in the
3 Wildlife Code or at a hunting enclosure approved through
4 rules adopted by the Department of Natural Resources. This
5 paragraph is exempt from the provisions of Section 3-90.
6 (27) (26) A motor vehicle, as that term is defined in
7 Section 1-146 of the Illinois Vehicle Code, that is donated
8 to a corporation, limited liability company, society,
9 association, foundation, or institution that is determined by
10 the Department to be organized and operated exclusively for
11 educational purposes. For purposes of this exemption, "a
12 corporation, limited liability company, society, association,
13 foundation, or institution organized and operated exclusively
14 for educational purposes" means all tax-supported public
15 schools, private schools that offer systematic instruction in
16 useful branches of learning by methods common to public
17 schools and that compare favorably in their scope and
18 intensity with the course of study presented in tax-supported
19 schools, and vocational or technical schools or institutes
20 organized and operated exclusively to provide a course of
21 study of not less than 6 weeks duration and designed to
22 prepare individuals to follow a trade or to pursue a manual,
23 technical, mechanical, industrial, business, or commercial
24 occupation.
25 (28) (27) Beginning January 1, 2000, personal property,
26 including food, purchased through fundraising events for the
27 benefit of a public or private elementary or secondary
28 school, a group of those schools, or one or more school
29 districts if the events are sponsored by an entity recognized
30 by the school district that consists primarily of volunteers
31 and includes parents and teachers of the school children.
32 This paragraph does not apply to fundraising events (i) for
33 the benefit of private home instruction or (ii) for which the
34 fundraising entity purchases the personal property sold at
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1 the events from another individual or entity that sold the
2 property for the purpose of resale by the fundraising entity
3 and that profits from the sale to the fundraising entity.
4 This paragraph is exempt from the provisions of Section 3-90.
5 (29) (26) Beginning January 1, 2000, new or used
6 automatic vending machines that prepare and serve hot food
7 and beverages, including coffee, soup, and other items, and
8 replacement parts for these machines. This paragraph is
9 exempt from the provisions of Section 3-90.
10 (30) Food for human consumption that is to be consumed
11 off the premises where it is sold (other than alcoholic
12 beverages, soft drinks, and food that has been prepared for
13 immediate consumption) and prescription and nonprescription
14 medicines, drugs, medical appliances, and insulin, urine
15 testing materials, syringes, and needles used by diabetics,
16 for human use, when purchased for use by a person receiving
17 medical assistance under Article 5 of the Illinois Public Aid
18 Code who resides in a licensed long-term care facility, as
19 defined in the Nursing Home Care Act.
20 (Source: P.A. 90-14, eff. 7-1-97; 90-552, eff. 12-12-97;
21 90-605, eff. 6-30-98; 91-51, eff. 6-30-99; 91-200, eff.
22 7-20-99; 91-439, eff. 8-6-99; 91-637, eff. 8-20-99; 91-644,
23 eff. 8-20-99; revised 9-29-99.)
24 (35 ILCS 105/3-70) (from Ch. 120, par. 439.3-70)
25 Sec. 3-70. Property acquired by nonresident. The tax
26 imposed by this Act does not apply to the use, in this State,
27 of tangible personal property that is acquired outside this
28 State by a nonresident individual who then brings the
29 property to this State for use here and who has used the
30 property outside this State for at least 3 months before
31 bringing the property to this State.
32 Where a business that is not operated in Illinois, but is
33 operated in another State, is moved to Illinois or opens an
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1 office, plant, or other business facility in Illinois, that
2 business shall not be taxed on its use, in Illinois, of used
3 tangible personal property, other than items of tangible
4 personal property that must be titled or registered with the
5 State of Illinois or whose registration with the United
6 States Government must be filed with the State of Illinois,
7 that the business bought outside Illinois and used outside
8 Illinois in the operation of the business for at least 3
9 months before moving the used property to Illinois for use in
10 this State.
11 "Acquired outside this State", whenever used in this Act,
12 in addition to its usual and popular meaning, also means the
13 delivery, outside Illinois, of tangible personal property
14 that is purchased in this State and delivered from a point in
15 this State to a point of delivery outside this State.
16 (Source: P.A. 91-51, eff. 6-30-99.)
17 (35 ILCS 105/9) (from Ch. 120, par. 439.9)
18 Sec. 9. Except as to motor vehicles, watercraft,
19 aircraft, and trailers that are required to be registered
20 with an agency of this State, each retailer required or
21 authorized to collect the tax imposed by this Act shall pay
22 to the Department the amount of such tax (except as otherwise
23 provided) at the time when he is required to file his return
24 for the period during which such tax was collected, less a
25 discount of 2.1% prior to January 1, 1990, and 1.75% on and
26 after January 1, 1990, or $5 per calendar year, whichever is
27 greater, which is allowed to reimburse the retailer for
28 expenses incurred in collecting the tax, keeping records,
29 preparing and filing returns, remitting the tax and supplying
30 data to the Department on request. In the case of retailers
31 who report and pay the tax on a transaction by transaction
32 basis, as provided in this Section, such discount shall be
33 taken with each such tax remittance instead of when such
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1 retailer files his periodic return. A retailer need not
2 remit that part of any tax collected by him to the extent
3 that he is required to remit and does remit the tax imposed
4 by the Retailers' Occupation Tax Act, with respect to the
5 sale of the same property.
6 Where such tangible personal property is sold under a
7 conditional sales contract, or under any other form of sale
8 wherein the payment of the principal sum, or a part thereof,
9 is extended beyond the close of the period for which the
10 return is filed, the retailer, in collecting the tax (except
11 as to motor vehicles, watercraft, aircraft, and trailers that
12 are required to be registered with an agency of this State),
13 may collect for each tax return period, only the tax
14 applicable to that part of the selling price actually
15 received during such tax return period.
16 Except as provided in this Section, on or before the
17 twentieth day of each calendar month, such retailer shall
18 file a return for the preceding calendar month. Such return
19 shall be filed on forms prescribed by the Department and
20 shall furnish such information as the Department may
21 reasonably require.
22 The Department may require returns to be filed on a
23 quarterly basis. If so required, a return for each calendar
24 quarter shall be filed on or before the twentieth day of the
25 calendar month following the end of such calendar quarter.
26 The taxpayer shall also file a return with the Department for
27 each of the first two months of each calendar quarter, on or
28 before the twentieth day of the following calendar month,
29 stating:
30 1. The name of the seller;
31 2. The address of the principal place of business
32 from which he engages in the business of selling tangible
33 personal property at retail in this State;
34 3. The total amount of taxable receipts received by
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1 him during the preceding calendar month from sales of
2 tangible personal property by him during such preceding
3 calendar month, including receipts from charge and time
4 sales, but less all deductions allowed by law;
5 4. The amount of credit provided in Section 2d of
6 this Act;
7 5. The amount of tax due;
8 5-5. The signature of the taxpayer; and
9 6. Such other reasonable information as the
10 Department may require.
11 If a taxpayer fails to sign a return within 30 days after
12 the proper notice and demand for signature by the Department,
13 the return shall be considered valid and any amount shown to
14 be due on the return shall be deemed assessed.
15 Beginning October 1, 1993, a taxpayer who has an average
16 monthly tax liability of $150,000 or more shall make all
17 payments required by rules of the Department by electronic
18 funds transfer. Beginning October 1, 1994, a taxpayer who has
19 an average monthly tax liability of $100,000 or more shall
20 make all payments required by rules of the Department by
21 electronic funds transfer. Beginning October 1, 1995, a
22 taxpayer who has an average monthly tax liability of $50,000
23 or more shall make all payments required by rules of the
24 Department by electronic funds transfer. Beginning October 1,
25 2000, a taxpayer who has an annual tax liability of $200,000
26 or more shall make all payments required by rules of the
27 Department by electronic funds transfer. The term "annual
28 tax liability" shall be the sum of the taxpayer's liabilities
29 under this Act, and under all other State and local
30 occupation and use tax laws administered by the Department,
31 for the immediately preceding calendar year. The term
32 "average monthly tax liability" means the sum of the
33 taxpayer's liabilities under this Act, and under all other
34 State and local occupation and use tax laws administered by
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1 the Department, for the immediately preceding calendar year
2 divided by 12.
3 Before August 1 of each year beginning in 1993, the
4 Department shall notify all taxpayers required to make
5 payments by electronic funds transfer. All taxpayers required
6 to make payments by electronic funds transfer shall make
7 those payments for a minimum of one year beginning on October
8 1.
9 Any taxpayer not required to make payments by electronic
10 funds transfer may make payments by electronic funds transfer
11 with the permission of the Department.
12 All taxpayers required to make payment by electronic
13 funds transfer and any taxpayers authorized to voluntarily
14 make payments by electronic funds transfer shall make those
15 payments in the manner authorized by the Department.
16 The Department shall adopt such rules as are necessary to
17 effectuate a program of electronic funds transfer and the
18 requirements of this Section.
19 Before October 1, 2000, if the taxpayer's average monthly
20 tax liability to the Department under this Act, the
21 Retailers' Occupation Tax Act, the Service Occupation Tax
22 Act, the Service Use Tax Act was $10,000 or more during the
23 preceding 4 complete calendar quarters, he shall file a
24 return with the Department each month by the 20th day of the
25 month next following the month during which such tax
26 liability is incurred and shall make payments to the
27 Department on or before the 7th, 15th, 22nd and last day of
28 the month during which such liability is incurred. On and
29 after October 1, 2000, if the taxpayer's average monthly tax
30 liability to the Department under this Act, the Retailers'
31 Occupation Tax Act, the Service Occupation Tax Act, and the
32 Service Use Tax Act was $20,000 or more during the preceding
33 4 complete calendar quarters, he shall file a return with the
34 Department each month by the 20th day of the month next
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1 following the month during which such tax liability is
2 incurred and shall make payment to the Department on or
3 before the 7th, 15th, 22nd and last day of or the month
4 during which such liability is incurred. If the month during
5 which such tax liability is incurred began prior to January
6 1, 1985, each payment shall be in an amount equal to 1/4 of
7 the taxpayer's actual liability for the month or an amount
8 set by the Department not to exceed 1/4 of the average
9 monthly liability of the taxpayer to the Department for the
10 preceding 4 complete calendar quarters (excluding the month
11 of highest liability and the month of lowest liability in
12 such 4 quarter period). If the month during which such tax
13 liability is incurred begins on or after January 1, 1985, and
14 prior to January 1, 1987, each payment shall be in an amount
15 equal to 22.5% of the taxpayer's actual liability for the
16 month or 27.5% of the taxpayer's liability for the same
17 calendar month of the preceding year. If the month during
18 which such tax liability is incurred begins on or after
19 January 1, 1987, and prior to January 1, 1988, each payment
20 shall be in an amount equal to 22.5% of the taxpayer's actual
21 liability for the month or 26.25% of the taxpayer's liability
22 for the same calendar month of the preceding year. If the
23 month during which such tax liability is incurred begins on
24 or after January 1, 1988, and prior to January 1, 1989, or
25 begins on or after January 1, 1996, each payment shall be in
26 an amount equal to 22.5% of the taxpayer's actual liability
27 for the month or 25% of the taxpayer's liability for the same
28 calendar month of the preceding year. If the month during
29 which such tax liability is incurred begins on or after
30 January 1, 1989, and prior to January 1, 1996, each payment
31 shall be in an amount equal to 22.5% of the taxpayer's actual
32 liability for the month or 25% of the taxpayer's liability
33 for the same calendar month of the preceding year or 100% of
34 the taxpayer's actual liability for the quarter monthly
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1 reporting period. The amount of such quarter monthly
2 payments shall be credited against the final tax liability of
3 the taxpayer's return for that month. Before October 1,
4 2000, once applicable, the requirement of the making of
5 quarter monthly payments to the Department shall continue
6 until such taxpayer's average monthly liability to the
7 Department during the preceding 4 complete calendar quarters
8 (excluding the month of highest liability and the month of
9 lowest liability) is less than $9,000, or until such
10 taxpayer's average monthly liability to the Department as
11 computed for each calendar quarter of the 4 preceding
12 complete calendar quarter period is less than $10,000.
13 However, if a taxpayer can show the Department that a
14 substantial change in the taxpayer's business has occurred
15 which causes the taxpayer to anticipate that his average
16 monthly tax liability for the reasonably foreseeable future
17 will fall below the $10,000 threshold stated above, then such
18 taxpayer may petition the Department for change in such
19 taxpayer's reporting status. On and after October 1, 2000,
20 once applicable, the requirement of the making of quarter
21 monthly payments to the Department shall continue until such
22 taxpayer's average monthly liability to the Department during
23 the preceding 4 complete calendar quarters (excluding the
24 month of highest liability and the month of lowest liability)
25 is less than $19,000 or until such taxpayer's average monthly
26 liability to the Department as computed for each calendar
27 quarter of the 4 preceding complete calendar quarter period
28 is less than $20,000. However, if a taxpayer can show the
29 Department that a substantial change in the taxpayer's
30 business has occurred which causes the taxpayer to anticipate
31 that his average monthly tax liability for the reasonably
32 foreseeable future will fall below the $20,000 threshold
33 stated above, then such taxpayer may petition the Department
34 for a change in such taxpayer's reporting status. The
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1 Department shall change such taxpayer's reporting status
2 unless it finds that such change is seasonal in nature and
3 not likely to be long term. If any such quarter monthly
4 payment is not paid at the time or in the amount required by
5 this Section, then the taxpayer shall be liable for penalties
6 and interest on the difference between the minimum amount due
7 and the amount of such quarter monthly payment actually and
8 timely paid, except insofar as the taxpayer has previously
9 made payments for that month to the Department in excess of
10 the minimum payments previously due as provided in this
11 Section. The Department shall make reasonable rules and
12 regulations to govern the quarter monthly payment amount and
13 quarter monthly payment dates for taxpayers who file on other
14 than a calendar monthly basis.
15 If any such payment provided for in this Section exceeds
16 the taxpayer's liabilities under this Act, the Retailers'
17 Occupation Tax Act, the Service Occupation Tax Act and the
18 Service Use Tax Act, as shown by an original monthly return,
19 the Department shall issue to the taxpayer a credit
20 memorandum no later than 30 days after the date of payment,
21 which memorandum may be submitted by the taxpayer to the
22 Department in payment of tax liability subsequently to be
23 remitted by the taxpayer to the Department or be assigned by
24 the taxpayer to a similar taxpayer under this Act, the
25 Retailers' Occupation Tax Act, the Service Occupation Tax Act
26 or the Service Use Tax Act, in accordance with reasonable
27 rules and regulations to be prescribed by the Department,
28 except that if such excess payment is shown on an original
29 monthly return and is made after December 31, 1986, no credit
30 memorandum shall be issued, unless requested by the taxpayer.
31 If no such request is made, the taxpayer may credit such
32 excess payment against tax liability subsequently to be
33 remitted by the taxpayer to the Department under this Act,
34 the Retailers' Occupation Tax Act, the Service Occupation Tax
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1 Act or the Service Use Tax Act, in accordance with reasonable
2 rules and regulations prescribed by the Department. If the
3 Department subsequently determines that all or any part of
4 the credit taken was not actually due to the taxpayer, the
5 taxpayer's 2.1% or 1.75% vendor's discount shall be reduced
6 by 2.1% or 1.75% of the difference between the credit taken
7 and that actually due, and the taxpayer shall be liable for
8 penalties and interest on such difference.
9 If the retailer is otherwise required to file a monthly
10 return and if the retailer's average monthly tax liability to
11 the Department does not exceed $200, the Department may
12 authorize his returns to be filed on a quarter annual basis,
13 with the return for January, February, and March of a given
14 year being due by April 20 of such year; with the return for
15 April, May and June of a given year being due by July 20 of
16 such year; with the return for July, August and September of
17 a given year being due by October 20 of such year, and with
18 the return for October, November and December of a given year
19 being due by January 20 of the following year.
20 If the retailer is otherwise required to file a monthly
21 or quarterly return and if the retailer's average monthly tax
22 liability to the Department does not exceed $50, the
23 Department may authorize his returns to be filed on an annual
24 basis, with the return for a given year being due by January
25 20 of the following year.
26 Such quarter annual and annual returns, as to form and
27 substance, shall be subject to the same requirements as
28 monthly returns.
29 Notwithstanding any other provision in this Act
30 concerning the time within which a retailer may file his
31 return, in the case of any retailer who ceases to engage in a
32 kind of business which makes him responsible for filing
33 returns under this Act, such retailer shall file a final
34 return under this Act with the Department not more than one
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1 month after discontinuing such business.
2 In addition, with respect to motor vehicles, watercraft,
3 aircraft, and trailers that are required to be registered
4 with an agency of this State, every retailer selling this
5 kind of tangible personal property shall file, with the
6 Department, upon a form to be prescribed and supplied by the
7 Department, a separate return for each such item of tangible
8 personal property which the retailer sells, except that if
9 where, in the same transaction, (i) a retailer of aircraft,
10 watercraft, motor vehicles or trailers transfers more than
11 one aircraft, watercraft, motor vehicle or trailer to another
12 aircraft, watercraft, motor vehicle or trailer retailer for
13 the purpose of resale or (ii) a retailer of aircraft,
14 watercraft, motor vehicles, or trailers transfers more than
15 one aircraft, watercraft, motor vehicle, or trailer to a
16 purchaser for use as a qualifying rolling stock as provided
17 in Section 3-55 of this Act, then that seller for resale may
18 report the transfer of all the aircraft, watercraft, motor
19 vehicles or trailers involved in that transaction to the
20 Department on the same uniform invoice-transaction reporting
21 return form. For purposes of this Section, "watercraft"
22 means a Class 2, Class 3, or Class 4 watercraft as defined in
23 Section 3-2 of the Boat Registration and Safety Act, a
24 personal watercraft, or any boat equipped with an inboard
25 motor.
26 The transaction reporting return in the case of motor
27 vehicles or trailers that are required to be registered with
28 an agency of this State, shall be the same document as the
29 Uniform Invoice referred to in Section 5-402 of the Illinois
30 Vehicle Code and must show the name and address of the
31 seller; the name and address of the purchaser; the amount of
32 the selling price including the amount allowed by the
33 retailer for traded-in property, if any; the amount allowed
34 by the retailer for the traded-in tangible personal property,
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1 if any, to the extent to which Section 2 of this Act allows
2 an exemption for the value of traded-in property; the balance
3 payable after deducting such trade-in allowance from the
4 total selling price; the amount of tax due from the retailer
5 with respect to such transaction; the amount of tax collected
6 from the purchaser by the retailer on such transaction (or
7 satisfactory evidence that such tax is not due in that
8 particular instance, if that is claimed to be the fact); the
9 place and date of the sale; a sufficient identification of
10 the property sold; such other information as is required in
11 Section 5-402 of the Illinois Vehicle Code, and such other
12 information as the Department may reasonably require.
13 The transaction reporting return in the case of
14 watercraft and aircraft must show the name and address of the
15 seller; the name and address of the purchaser; the amount of
16 the selling price including the amount allowed by the
17 retailer for traded-in property, if any; the amount allowed
18 by the retailer for the traded-in tangible personal property,
19 if any, to the extent to which Section 2 of this Act allows
20 an exemption for the value of traded-in property; the balance
21 payable after deducting such trade-in allowance from the
22 total selling price; the amount of tax due from the retailer
23 with respect to such transaction; the amount of tax collected
24 from the purchaser by the retailer on such transaction (or
25 satisfactory evidence that such tax is not due in that
26 particular instance, if that is claimed to be the fact); the
27 place and date of the sale, a sufficient identification of
28 the property sold, and such other information as the
29 Department may reasonably require.
30 Such transaction reporting return shall be filed not
31 later than 20 days after the date of delivery of the item
32 that is being sold, but may be filed by the retailer at any
33 time sooner than that if he chooses to do so. The
34 transaction reporting return and tax remittance or proof of
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1 exemption from the tax that is imposed by this Act may be
2 transmitted to the Department by way of the State agency with
3 which, or State officer with whom, the tangible personal
4 property must be titled or registered (if titling or
5 registration is required) if the Department and such agency
6 or State officer determine that this procedure will expedite
7 the processing of applications for title or registration.
8 With each such transaction reporting return, the retailer
9 shall remit the proper amount of tax due (or shall submit
10 satisfactory evidence that the sale is not taxable if that is
11 the case), to the Department or its agents, whereupon the
12 Department shall issue, in the purchaser's name, a tax
13 receipt (or a certificate of exemption if the Department is
14 satisfied that the particular sale is tax exempt) which such
15 purchaser may submit to the agency with which, or State
16 officer with whom, he must title or register the tangible
17 personal property that is involved (if titling or
18 registration is required) in support of such purchaser's
19 application for an Illinois certificate or other evidence of
20 title or registration to such tangible personal property.
21 No retailer's failure or refusal to remit tax under this
22 Act precludes a user, who has paid the proper tax to the
23 retailer, from obtaining his certificate of title or other
24 evidence of title or registration (if titling or registration
25 is required) upon satisfying the Department that such user
26 has paid the proper tax (if tax is due) to the retailer. The
27 Department shall adopt appropriate rules to carry out the
28 mandate of this paragraph.
29 If the user who would otherwise pay tax to the retailer
30 wants the transaction reporting return filed and the payment
31 of tax or proof of exemption made to the Department before
32 the retailer is willing to take these actions and such user
33 has not paid the tax to the retailer, such user may certify
34 to the fact of such delay by the retailer, and may (upon the
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1 Department being satisfied of the truth of such
2 certification) transmit the information required by the
3 transaction reporting return and the remittance for tax or
4 proof of exemption directly to the Department and obtain his
5 tax receipt or exemption determination, in which event the
6 transaction reporting return and tax remittance (if a tax
7 payment was required) shall be credited by the Department to
8 the proper retailer's account with the Department, but
9 without the 2.1% or 1.75% discount provided for in this
10 Section being allowed. When the user pays the tax directly
11 to the Department, he shall pay the tax in the same amount
12 and in the same form in which it would be remitted if the tax
13 had been remitted to the Department by the retailer.
14 Where a retailer collects the tax with respect to the
15 selling price of tangible personal property which he sells
16 and the purchaser thereafter returns such tangible personal
17 property and the retailer refunds the selling price thereof
18 to the purchaser, such retailer shall also refund, to the
19 purchaser, the tax so collected from the purchaser. When
20 filing his return for the period in which he refunds such tax
21 to the purchaser, the retailer may deduct the amount of the
22 tax so refunded by him to the purchaser from any other use
23 tax which such retailer may be required to pay or remit to
24 the Department, as shown by such return, if the amount of the
25 tax to be deducted was previously remitted to the Department
26 by such retailer. If the retailer has not previously
27 remitted the amount of such tax to the Department, he is
28 entitled to no deduction under this Act upon refunding such
29 tax to the purchaser.
30 Any retailer filing a return under this Section shall
31 also include (for the purpose of paying tax thereon) the
32 total tax covered by such return upon the selling price of
33 tangible personal property purchased by him at retail from a
34 retailer, but as to which the tax imposed by this Act was not
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1 collected from the retailer filing such return, and such
2 retailer shall remit the amount of such tax to the Department
3 when filing such return.
4 If experience indicates such action to be practicable,
5 the Department may prescribe and furnish a combination or
6 joint return which will enable retailers, who are required to
7 file returns hereunder and also under the Retailers'
8 Occupation Tax Act, to furnish all the return information
9 required by both Acts on the one form.
10 Where the retailer has more than one business registered
11 with the Department under separate registration under this
12 Act, such retailer may not file each return that is due as a
13 single return covering all such registered businesses, but
14 shall file separate returns for each such registered
15 business.
16 Beginning January 1, 1990, each month the Department
17 shall pay into the State and Local Sales Tax Reform Fund, a
18 special fund in the State Treasury which is hereby created,
19 the net revenue realized for the preceding month from the 1%
20 tax on sales of food for human consumption which is to be
21 consumed off the premises where it is sold (other than
22 alcoholic beverages, soft drinks and food which has been
23 prepared for immediate consumption) and prescription and
24 nonprescription medicines, drugs, medical appliances and
25 insulin, urine testing materials, syringes and needles used
26 by diabetics.
27 Beginning January 1, 1990, each month the Department
28 shall pay into the County and Mass Transit District Fund 4%
29 of the net revenue realized for the preceding month from the
30 6.25% general rate on the selling price of tangible personal
31 property which is purchased outside Illinois at retail from a
32 retailer and which is titled or registered by an agency of
33 this State's government.
34 Beginning January 1, 1990, each month the Department
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1 shall pay into the State and Local Sales Tax Reform Fund, a
2 special fund in the State Treasury, 20% of the net revenue
3 realized for the preceding month from the 6.25% general rate
4 on the selling price of tangible personal property, other
5 than tangible personal property which is purchased outside
6 Illinois at retail from a retailer and which is titled or
7 registered by an agency of this State's government.
8 Beginning January 1, 1990, each month the Department
9 shall pay into the Local Government Tax Fund 16% of the net
10 revenue realized for the preceding month from the 6.25%
11 general rate on the selling price of tangible personal
12 property which is purchased outside Illinois at retail from a
13 retailer and which is titled or registered by an agency of
14 this State's government.
15 Of the remainder of the moneys received by the Department
16 pursuant to this Act, (a) 1.75% thereof shall be paid into
17 the Build Illinois Fund and (b) prior to July 1, 1989, 2.2%
18 and on and after July 1, 1989, 3.8% thereof shall be paid
19 into the Build Illinois Fund; provided, however, that if in
20 any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%,
21 as the case may be, of the moneys received by the Department
22 and required to be paid into the Build Illinois Fund pursuant
23 to Section 3 of the Retailers' Occupation Tax Act, Section 9
24 of the Use Tax Act, Section 9 of the Service Use Tax Act, and
25 Section 9 of the Service Occupation Tax Act, such Acts being
26 hereinafter called the "Tax Acts" and such aggregate of 2.2%
27 or 3.8%, as the case may be, of moneys being hereinafter
28 called the "Tax Act Amount", and (2) the amount transferred
29 to the Build Illinois Fund from the State and Local Sales Tax
30 Reform Fund shall be less than the Annual Specified Amount
31 (as defined in Section 3 of the Retailers' Occupation Tax
32 Act), an amount equal to the difference shall be immediately
33 paid into the Build Illinois Fund from other moneys received
34 by the Department pursuant to the Tax Acts; and further
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1 provided, that if on the last business day of any month the
2 sum of (1) the Tax Act Amount required to be deposited into
3 the Build Illinois Bond Account in the Build Illinois Fund
4 during such month and (2) the amount transferred during such
5 month to the Build Illinois Fund from the State and Local
6 Sales Tax Reform Fund shall have been less than 1/12 of the
7 Annual Specified Amount, an amount equal to the difference
8 shall be immediately paid into the Build Illinois Fund from
9 other moneys received by the Department pursuant to the Tax
10 Acts; and, further provided, that in no event shall the
11 payments required under the preceding proviso result in
12 aggregate payments into the Build Illinois Fund pursuant to
13 this clause (b) for any fiscal year in excess of the greater
14 of (i) the Tax Act Amount or (ii) the Annual Specified Amount
15 for such fiscal year; and, further provided, that the amounts
16 payable into the Build Illinois Fund under this clause (b)
17 shall be payable only until such time as the aggregate amount
18 on deposit under each trust indenture securing Bonds issued
19 and outstanding pursuant to the Build Illinois Bond Act is
20 sufficient, taking into account any future investment income,
21 to fully provide, in accordance with such indenture, for the
22 defeasance of or the payment of the principal of, premium, if
23 any, and interest on the Bonds secured by such indenture and
24 on any Bonds expected to be issued thereafter and all fees
25 and costs payable with respect thereto, all as certified by
26 the Director of the Bureau of the Budget. If on the last
27 business day of any month in which Bonds are outstanding
28 pursuant to the Build Illinois Bond Act, the aggregate of the
29 moneys deposited in the Build Illinois Bond Account in the
30 Build Illinois Fund in such month shall be less than the
31 amount required to be transferred in such month from the
32 Build Illinois Bond Account to the Build Illinois Bond
33 Retirement and Interest Fund pursuant to Section 13 of the
34 Build Illinois Bond Act, an amount equal to such deficiency
-92- LRB9110442SMdvB
1 shall be immediately paid from other moneys received by the
2 Department pursuant to the Tax Acts to the Build Illinois
3 Fund; provided, however, that any amounts paid to the Build
4 Illinois Fund in any fiscal year pursuant to this sentence
5 shall be deemed to constitute payments pursuant to clause (b)
6 of the preceding sentence and shall reduce the amount
7 otherwise payable for such fiscal year pursuant to clause (b)
8 of the preceding sentence. The moneys received by the
9 Department pursuant to this Act and required to be deposited
10 into the Build Illinois Fund are subject to the pledge, claim
11 and charge set forth in Section 12 of the Build Illinois Bond
12 Act.
13 Subject to payment of amounts into the Build Illinois
14 Fund as provided in the preceding paragraph or in any
15 amendment thereto hereafter enacted, the following specified
16 monthly installment of the amount requested in the
17 certificate of the Chairman of the Metropolitan Pier and
18 Exposition Authority provided under Section 8.25f of the
19 State Finance Act, but not in excess of the sums designated
20 as "Total Deposit", shall be deposited in the aggregate from
21 collections under Section 9 of the Use Tax Act, Section 9 of
22 the Service Use Tax Act, Section 9 of the Service Occupation
23 Tax Act, and Section 3 of the Retailers' Occupation Tax Act
24 into the McCormick Place Expansion Project Fund in the
25 specified fiscal years.
26 Fiscal Year Total Deposit
27 1993 $0
28 1994 53,000,000
29 1995 58,000,000
30 1996 61,000,000
31 1997 64,000,000
32 1998 68,000,000
33 1999 71,000,000
34 2000 75,000,000
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1 2001 80,000,000
2 2002 84,000,000
3 2003 89,000,000
4 2004 93,000,000
5 2005 97,000,000
6 2006 102,000,000
7 2007 108,000,000
8 2008 115,000,000
9 2009 120,000,000
10 2010 126,000,000
11 2011 132,000,000
12 2012 138,000,000
13 2013 and 145,000,000
14 each fiscal year
15 thereafter that bonds
16 are outstanding under
17 Section 13.2 of the
18 Metropolitan Pier and
19 Exposition Authority
20 Act, but not after fiscal year 2029.
21 Beginning July 20, 1993 and in each month of each fiscal
22 year thereafter, one-eighth of the amount requested in the
23 certificate of the Chairman of the Metropolitan Pier and
24 Exposition Authority for that fiscal year, less the amount
25 deposited into the McCormick Place Expansion Project Fund by
26 the State Treasurer in the respective month under subsection
27 (g) of Section 13 of the Metropolitan Pier and Exposition
28 Authority Act, plus cumulative deficiencies in the deposits
29 required under this Section for previous months and years,
30 shall be deposited into the McCormick Place Expansion Project
31 Fund, until the full amount requested for the fiscal year,
32 but not in excess of the amount specified above as "Total
33 Deposit", has been deposited.
34 Subject to payment of amounts into the Build Illinois
-94- LRB9110442SMdvB
1 Fund and the McCormick Place Expansion Project Fund pursuant
2 to the preceding paragraphs or in any amendment thereto
3 hereafter enacted, each month the Department shall pay into
4 the Local Government Distributive Fund .4% of the net revenue
5 realized for the preceding month from the 5% general rate, or
6 .4% of 80% of the net revenue realized for the preceding
7 month from the 6.25% general rate, as the case may be, on the
8 selling price of tangible personal property which amount
9 shall, subject to appropriation, be distributed as provided
10 in Section 2 of the State Revenue Sharing Act. No payments or
11 distributions pursuant to this paragraph shall be made if the
12 tax imposed by this Act on photoprocessing products is
13 declared unconstitutional, or if the proceeds from such tax
14 are unavailable for distribution because of litigation.
15 Subject to payment of amounts into the Build Illinois
16 Fund, the McCormick Place Expansion Project Fund, and the
17 Local Government Distributive Fund pursuant to the preceding
18 paragraphs or in any amendments thereto hereafter enacted,
19 beginning July 1, 1993, the Department shall each month pay
20 into the Illinois Tax Increment Fund 0.27% of 80% of the net
21 revenue realized for the preceding month from the 6.25%
22 general rate on the selling price of tangible personal
23 property.
24 Of the remainder of the moneys received by the Department
25 pursuant to this Act, 75% thereof shall be paid into the
26 State Treasury and 25% shall be reserved in a special account
27 and used only for the transfer to the Common School Fund as
28 part of the monthly transfer from the General Revenue Fund in
29 accordance with Section 8a of the State Finance Act.
30 As soon as possible after the first day of each month,
31 upon certification of the Department of Revenue, the
32 Comptroller shall order transferred and the Treasurer shall
33 transfer from the General Revenue Fund to the Motor Fuel Tax
34 Fund an amount equal to 1.7% of 80% of the net revenue
-95- LRB9110442SMdvB
1 realized under this Act for the second preceding month.
2 Beginning April 1, 2000, this transfer is no longer required
3 and shall not be made.
4 Net revenue realized for a month shall be the revenue
5 collected by the State pursuant to this Act, less the amount
6 paid out during that month as refunds to taxpayers for
7 overpayment of liability.
8 For greater simplicity of administration, manufacturers,
9 importers and wholesalers whose products are sold at retail
10 in Illinois by numerous retailers, and who wish to do so, may
11 assume the responsibility for accounting and paying to the
12 Department all tax accruing under this Act with respect to
13 such sales, if the retailers who are affected do not make
14 written objection to the Department to this arrangement.
15 (Source: P.A. 90-491, eff. 1-1-99; 90-612, eff. 7-8-98;
16 91-37, eff. 7-1-99; 91-51, eff. 6-30-99; 91-101, eff.
17 7-12-99; 91-541, eff. 8-13-99; revised 9-29-99.)
18 (35 ILCS 105/10) (from Ch. 120, par. 439.10)
19 Sec. 10. Except as to motor vehicles, and aircraft,
20 watercraft, and trailers, when tangible personal property is
21 purchased from a retailer for use in this State by a
22 purchaser who did not pay the tax imposed by this Act to the
23 retailer, and who does not file returns with the Department
24 as a retailer under Section 9 of this Act, such purchaser (by
25 the last day of the month following the calendar month in
26 which such purchaser makes any payment upon the selling price
27 of such property) shall, except as provided in this Section,
28 file a return with the Department and pay the tax upon that
29 portion of the selling price so paid by the purchaser during
30 the preceding calendar month. When tangible personal
31 property, including but not limited to motor vehicles and
32 aircraft, is purchased by a lessor, under a lease for one
33 year or longer, executed or in effect at the time of purchase
-96- LRB9110442SMdvB
1 to an interstate carrier for hire, who did not pay the tax
2 imposed by this Act to the retailer, such lessor (by the last
3 day of the month following the calendar month in which such
4 property reverts to the use of such lessor) shall file a
5 return with the Department and pay the tax upon the fair
6 market value of such property on the date of such reversion.
7 However, in determining the fair market value at the time of
8 reversion, the fair market value of such property shall not
9 exceed the original purchase price of the property that was
10 paid by the lessor at the time of purchase. Such return shall
11 be filed on a form prescribed by the Department and shall
12 contain such information as the Department may reasonably
13 require. Such return and payment from the purchaser shall be
14 submitted to the Department sooner than the last day of the
15 month after the month in which the purchase is made to the
16 extent that that may be necessary in order to secure the
17 title to a motor vehicle or the certificate of registration
18 for an aircraft. However, except as to motor vehicles and
19 aircraft, if the purchaser's annual use tax liability does
20 not exceed $600, the purchaser may file the return on an
21 annual basis on or before April 15th of the year following
22 the year use tax liability was incurred.
23 In addition with respect to motor vehicles, and aircraft,
24 watercraft, and trailers, a purchaser of such tangible
25 personal property for use in this State, who purchases such
26 tangible personal property from an out-of-state retailer,
27 shall file with the Department, upon a form to be prescribed
28 and supplied by the Department, a return for each such item
29 of tangible personal property purchased, except that if, in
30 the same transaction, (i) a purchaser of motor vehicles,
31 aircraft, watercraft, or trailers who is a retailer of motor
32 vehicles, aircraft, watercraft, or trailers purchases more
33 than one motor vehicle, aircraft, watercraft, or trailer for
34 the purpose of resale or (ii) a purchaser of motor vehicles,
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1 aircraft, watercraft, or trailers purchases more than one
2 motor vehicle, aircraft, watercraft, or trailer for use as
3 qualifying rolling stock as provided in Section 3-55 of this
4 Act, then the purchaser may report the purchase of all motor
5 vehicles, aircraft, watercraft, or trailers involved in that
6 transaction to the Department on a single return prescribed
7 by the Department. Such return in the case of motor vehicles
8 and aircraft must show the name and address of the seller,
9 the name, address of purchaser, the amount of the selling
10 price including the amount allowed by the retailer for traded
11 in property, if any; the amount allowed by the retailer for
12 the traded-in tangible personal property, if any, to the
13 extent to which Section 2 of this Act allows an exemption for
14 the value of traded-in property; the balance payable after
15 deducting such trade-in allowance from the total selling
16 price; the amount of tax due from the purchaser with respect
17 to such transaction; the amount of tax collected from the
18 purchaser by the retailer on such transaction (or
19 satisfactory evidence that such tax is not due in that
20 particular instance if that is claimed to be the fact); the
21 place and date of the sale, a sufficient identification of
22 the property sold, and such other information as the
23 Department may reasonably require.
24 Such return shall be filed not later than 30 days after
25 such motor vehicle or aircraft is brought into this State for
26 use.
27 For purposes of this Section, "watercraft" means a Class
28 2, Class 3, or Class 4 watercraft as defined in Section 3-2
29 of the Boat Registration and Safety Act, a personal
30 watercraft, or any boat equipped with an inboard motor.
31 The return and tax remittance or proof of exemption from
32 the tax that is imposed by this Act may be transmitted to the
33 Department by way of the State agency with which, or State
34 officer with whom, the tangible personal property must be
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1 titled or registered (if titling or registration is required)
2 if the Department and such agency or State officer determine
3 that this procedure will expedite the processing of
4 applications for title or registration.
5 With each such return, the purchaser shall remit the
6 proper amount of tax due (or shall submit satisfactory
7 evidence that the sale is not taxable if that is the case),
8 to the Department or its agents, whereupon the Department
9 shall issue, in the purchaser's name, a tax receipt (or a
10 certificate of exemption if the Department is satisfied that
11 the particular sale is tax exempt) which such purchaser may
12 submit to the agency with which, or State officer with whom,
13 he must title or register the tangible personal property that
14 is involved (if titling or registration is required) in
15 support of such purchaser's application for an Illinois
16 certificate or other evidence of title or registration to
17 such tangible personal property.
18 When a purchaser pays a tax imposed by this Act directly
19 to the Department, the Department (upon request therefor from
20 such purchaser) shall issue an appropriate receipt to such
21 purchaser showing that he has paid such tax to the
22 Department. Such receipt shall be sufficient to relieve the
23 purchaser from further liability for the tax to which such
24 receipt may refer.
25 A user who is liable to pay use tax directly to the
26 Department only occasionally and not on a frequently
27 recurring basis, and who is not required to file returns with
28 the Department as a retailer under Section 9 of this Act, or
29 under the "Retailers' Occupation Tax Act", or as a registrant
30 with the Department under the "Service Occupation Tax Act" or
31 the "Service Use Tax Act", need not register with the
32 Department. However, if such a user has a frequently
33 recurring direct use tax liability to pay to the Department,
34 such user shall be required to register with the Department
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1 on forms prescribed by the Department and to obtain and
2 display a certificate of registration from the Department.
3 In that event, all of the provisions of Section 9 of this Act
4 concerning the filing of regular monthly, quarterly or annual
5 tax returns and all of the provisions of Section 2a of the
6 "Retailers' Occupation Tax Act" concerning the requirements
7 for registrants to post bond or other security with the
8 Department, as the provisions of such sections now exist or
9 may hereafter be amended, shall apply to such users to the
10 same extent as if such provisions were included herein.
11 (Source: P.A. 91-541, eff. 8-13-99.)
12 (35 ILCS 105/22) (from Ch. 120, par. 439.22)
13 Sec. 22. If it is determined that the Department should
14 issue a credit or refund under this Act, the Department may
15 first apply the amount thereof against any amount of tax or
16 penalty or interest due hereunder, or under the "Retailers'
17 Occupation Tax Act", the "Service Occupation Tax Act", the
18 "Service Use Tax Act", any local occupation or use tax
19 administered by the Department the "Municipal Retailers'
20 Occupation Tax Act", the "Municipal Use Tax Act", the
21 "Municipal Service Occupation Tax Act", the "County
22 Retailers' Occupation Tax Act", the "County Supplementary
23 Retailers' Occupation Tax Act", the "County Service
24 Occupation Tax Act", the "County Supplementary Service
25 Occupation Tax Act", the "County Use Tax Act", the "County
26 Supplementary Use Tax Act", Section 4 of the "Water
27 Commission Act of 1985", subsections (b), (c) and (d) of
28 Section 5.01 of the "Local Mass Transit District Act", or
29 subsections (e), (f) and (g) of Section 4.03 of the "Regional
30 Transportation Authority Act", from the person entitled to
31 such credit or refund. For this purpose, if proceedings are
32 pending to determine whether or not any tax or penalty or
33 interest is due under this Act or under the "Retailers'
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1 Occupation Tax Act", the "Service Occupation Tax Act", the
2 "Service Use Tax Act", any local occupation or use tax
3 administered by the Department the "Municipal Retailers'
4 Occupation Tax Act", the "Municipal Use Tax Act", the
5 "Municipal Service Occupation Tax Act", the "County
6 Retailers' Occupation Tax Act", the "County Supplementary
7 Retailers' Occupation Tax Act", the "County Service
8 Occupation Tax Act", the "County Supplementary Service
9 Occupation Tax Act", the "County Use Tax Act", the "County
10 Supplementary Use Tax Act", Section 4 of the "Water
11 Commission Act of 1985", subsections (b), (c) and (d) of
12 Section 5.01 of the "Local Mass Transit District Act", or
13 subsections (e), (f) and (g) of Section 4.03 of the "Regional
14 Transportation Authority Act", from such person, the
15 Department may withhold issuance of the credit or refund
16 pending the final disposition of such proceedings and may
17 apply such credit or refund against any amount found to be
18 due to the Department as a result of such proceedings. The
19 balance, if any, of the credit or refund shall be issued to
20 the person entitled thereto.
21 Any credit memorandum issued hereunder may be used by the
22 authorized holder thereof to pay any tax or penalty or
23 interest due or to become due under this Act or under the
24 "Retailers' Occupation Tax Act", the "Service Occupation Tax
25 Act", the "Service Use Tax Act", any local occupation or use
26 tax administered by the Department the "Municipal Retailers'
27 Occupation Tax Act", the "Municipal Use Tax Act", the
28 "Municipal Service Occupation Tax Act", the "County
29 Retailers' Occupation Tax Act", the "County Supplementary
30 Retailers' Occupation Tax Act", the "County Service
31 Occupation Tax Act", the "County Supplementary Service
32 Occupation Tax Act", the "County Use Tax Act", the "County
33 Supplementary Use Tax Act", Section 4 of the "Water
34 Commission Act of 1985", subsections (b), (c) and (d) of
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1 Section 5.01 of the "Local Mass Transit District Act", or
2 subsections (e), (f) and (g) of Section 4.03 of the "Regional
3 Transportation Authority Act", from such holder. Subject to
4 reasonable rules of the Department, a credit memorandum
5 issued hereunder may be assigned by the holder thereof to any
6 other person for use in paying tax or penalty or interest
7 which may be due or become due under this Act or under the
8 "Retailers' Occupation Tax Act", the "Service Occupation Tax
9 Act" or the "Service Use Tax Act", from the assignee.
10 In any case in which there has been an erroneous refund
11 of tax payable under this Act, a notice of tax liability may
12 be issued at any time within 3 years from the making of that
13 refund, or within 5 years from the making of that refund if
14 it appears that any part of the refund was induced by fraud
15 or the misrepresentation of a material fact. The amount of
16 any proposed assessment set forth in the notice shall be
17 limited to the amount of the erroneous refund.
18 (Source: P.A. 87-876.)
19 Section 15. The Service Use Tax Act is amended by
20 changing Section 20 as follows:
21 (35 ILCS 110/20) (from Ch. 120, par. 439.50)
22 Sec. 20. If it is determined that the Department should
23 issue a credit or refund hereunder, the Department may first
24 apply the amount thereof against any amount of tax or penalty
25 or interest due hereunder, or under the Service Occupation
26 Tax Act, the Retailers' Occupation Tax Act, the Use Tax Act,
27 any local occupation or use tax administered by the
28 Department the Municipal Retailers' Occupation Tax Act, the
29 Municipal Use Tax Act, the Municipal Service Occupation Tax
30 Act, the County Retailers' Occupation Tax Act, the County
31 Supplementary Retailers' Occupation Tax Act, the County
32 Service Occupation Tax Act, the County Supplementary Service
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1 Occupation Tax Act, the County Use Tax Act, the County
2 Supplementary Use Tax Act, Section 4 of the Water Commission
3 Act of 1985, subsections (b), (c) and (d) of Section 5.01 of
4 the Local Mass Transit District Act, or subsections (e), (f)
5 and (g) of Section 4.03 of the Regional Transportation
6 Authority Act, from the person entitled to such credit or
7 refund. For this purpose, if proceedings are pending to
8 determine whether or not any tax or penalty or interest is
9 due hereunder, or under the Service Occupation Tax Act, the
10 Retailers' Occupation Tax Act, the Use Tax Act, any local
11 occupation or use tax administered by the Department the
12 Municipal Retailers' Occupation Tax Act, the Municipal Use
13 Tax Act, the Municipal Service Occupation Tax Act, the County
14 Retailers' Occupation Tax Act, the County Supplementary
15 Retailers' Occupation Tax Act, the County Service Occupation
16 Tax Act, the County Supplementary Service Occupation Tax Act,
17 the County Use Tax Act, the County Supplementary Use Tax Act,
18 Section 4 of the Water Commission Act of 1985, subsections
19 (b), (c) and (d) of Section 5.01 of the Local Mass Transit
20 District Act, or subsections (e), (f) and (g) of Section 4.03
21 of the Regional Transportation Authority Act, from such
22 person, the Department may withhold issuance of the credit or
23 refund pending the final disposition of such proceedings and
24 may apply such credit or refund against any amount found to
25 be due to the Department as a result of such proceedings. The
26 balance, if any, of the credit or refund shall be issued to
27 the person entitled thereto.
28 Any credit memorandum issued hereunder may be used by the
29 authorized holder thereof to pay any tax or penalty or
30 interest due or to become due under this Act, the Service
31 Occupation Tax Act, the Retailers' Occupation Tax Act, the
32 Use Tax Act, any local occupation or use tax administered by
33 the Department the Municipal Retailers' Occupation Tax Act,
34 the Municipal Use Tax Act, the Municipal Service Occupation
-103- LRB9110442SMdvB
1 Tax Act, the County Retailers' Occupation Tax Act, the County
2 Supplementary Retailers' Occupation Tax Act, the County
3 Service Occupation Tax Act, the County Supplementary Service
4 Occupation Tax Act, the County Use Tax Act, the County
5 Supplementary Use Tax Act, Section 4 of the Water Commission
6 Act of 1985, subsections (b), (c) and (d) of Section 5.01 of
7 the Local Mass Transit District Act, or subsections (e), (f)
8 and (g) of Section 4.03 of the Regional Transportation
9 Authority Act, from such holder. Subject to reasonable rules
10 of the Department, a credit memorandum issued hereunder may
11 be assigned by the holder thereof to any other person for use
12 in paying tax or penalty or interest which may be due or
13 become due under this Act, the Service Occupation Tax Act,
14 the Retailers' Occupation Tax Act, the Use Tax Act, any local
15 occupation or use tax administered by the Department the
16 Municipal Retailers' Occupation Tax Act, the Municipal Use
17 Tax Act, the Municipal Service Occupation Tax Act, the County
18 Retailers' Occupation Tax Act, the County Supplementary
19 Retailers' Occupation Tax Act, the County Service Occupation
20 Tax Act, the County Supplementary Service Occupation Tax Act,
21 the County Use Tax Act, the County Supplementary Use Tax Act,
22 Section 4 of the Water Commission Act of 1985, subsections
23 (b), (c) and (d) of Section 5.01 of the Local Mass Transit
24 District Act, or subsections (e), (f) and (g) of Section 4.03
25 of the Regional Transportation Authority Act, from the
26 assignee.
27 In any case which there has been an erroneous refund of
28 tax payable under this Act, a notice of tax liability may be
29 issued at any time within 3 years from the making of that
30 refund, or within 5 years from the making of that refund if
31 it appears that any part of the refund was induced by fraud
32 or the misrepresentation of a material fact. The amount of
33 any proposed assessment set forth in the notice shall be
34 limited to the amount of the erroneous refund.
-104- LRB9110442SMdvB
1 (Source: P.A. 87-876.)
2 Section 20. The Service Occupation Tax Act is amended by
3 changing Sections 3-5 and 20 as follows:
4 (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
5 Sec. 3-5. Exemptions. The following tangible personal
6 property is exempt from the tax imposed by this Act:
7 (1) Personal property sold by a corporation, society,
8 association, foundation, institution, or organization, other
9 than a limited liability company, that is organized and
10 operated as a not-for-profit service enterprise for the
11 benefit of persons 65 years of age or older if the personal
12 property was not purchased by the enterprise for the purpose
13 of resale by the enterprise.
14 (2) Personal property purchased by a not-for-profit
15 Illinois county fair association for use in conducting,
16 operating, or promoting the county fair.
17 (3) Personal property purchased by any not-for-profit
18 arts or cultural organization that establishes, by proof
19 required by the Department by rule, that it has received an
20 exemption under Section 501(c)(3) of the Internal Revenue
21 Code and that is organized and operated for the presentation
22 or support of arts or cultural programming, activities, or
23 services. These organizations include, but are not limited
24 to, music and dramatic arts organizations such as symphony
25 orchestras and theatrical groups, arts and cultural service
26 organizations, local arts councils, visual arts
27 organizations, and media arts organizations.
28 (4) Legal tender, currency, medallions, or gold or
29 silver coinage issued by the State of Illinois, the
30 government of the United States of America, or the government
31 of any foreign country, and bullion.
32 (5) Graphic arts machinery and equipment, including
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1 repair and replacement parts, both new and used, and
2 including that manufactured on special order or purchased for
3 lease, certified by the purchaser to be used primarily for
4 graphic arts production.
5 (6) Personal property sold by a teacher-sponsored
6 student organization affiliated with an elementary or
7 secondary school located in Illinois.
8 (7) Farm machinery and equipment, both new and used,
9 including that manufactured on special order, certified by
10 the purchaser to be used primarily for production agriculture
11 or State or federal agricultural programs, including
12 individual replacement parts for the machinery and equipment,
13 including machinery and equipment purchased for lease, and
14 including implements of husbandry defined in Section 1-130 of
15 the Illinois Vehicle Code, farm machinery and agricultural
16 chemical and fertilizer spreaders, and nurse wagons required
17 to be registered under Section 3-809 of the Illinois Vehicle
18 Code, but excluding other motor vehicles required to be
19 registered under the Illinois Vehicle Code. Horticultural
20 polyhouses or hoop houses used for propagating, growing, or
21 overwintering plants shall be considered farm machinery and
22 equipment under this item (7). Agricultural chemical tender
23 tanks and dry boxes shall include units sold separately from
24 a motor vehicle required to be licensed and units sold
25 mounted on a motor vehicle required to be licensed if the
26 selling price of the tender is separately stated.
27 Farm machinery and equipment shall include precision
28 farming equipment that is installed or purchased to be
29 installed on farm machinery and equipment including, but not
30 limited to, tractors, harvesters, sprayers, planters,
31 seeders, or spreaders. Precision farming equipment includes,
32 but is not limited to, soil testing sensors, computers,
33 monitors, software, global positioning and mapping systems,
34 and other such equipment.
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1 Farm machinery and equipment also includes computers,
2 sensors, software, and related equipment used primarily in
3 the computer-assisted operation of production agriculture
4 facilities, equipment, and activities such as, but not
5 limited to, the collection, monitoring, and correlation of
6 animal and crop data for the purpose of formulating animal
7 diets and agricultural chemicals. This item (7) is exempt
8 from the provisions of Section 3-55.
9 (8) Fuel and petroleum products sold to or used by an
10 air common carrier, certified by the carrier to be used for
11 consumption, shipment, or storage in the conduct of its
12 business as an air common carrier, for a flight destined for
13 or returning from a location or locations outside the United
14 States without regard to previous or subsequent domestic
15 stopovers.
16 (9) Proceeds of mandatory service charges separately
17 stated on customers' bills for the purchase and consumption
18 of food and beverages, to the extent that the proceeds of the
19 service charge are in fact turned over as tips or as a
20 substitute for tips to the employees who participate directly
21 in preparing, serving, hosting or cleaning up the food or
22 beverage function with respect to which the service charge is
23 imposed.
24 (10) Oil field exploration, drilling, and production
25 equipment, including (i) rigs and parts of rigs, rotary rigs,
26 cable tool rigs, and workover rigs, (ii) pipe and tubular
27 goods, including casing and drill strings, (iii) pumps and
28 pump-jack units, (iv) storage tanks and flow lines, (v) any
29 individual replacement part for oil field exploration,
30 drilling, and production equipment, and (vi) machinery and
31 equipment purchased for lease; but excluding motor vehicles
32 required to be registered under the Illinois Vehicle Code.
33 (11) Photoprocessing machinery and equipment, including
34 repair and replacement parts, both new and used, including
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1 that manufactured on special order, certified by the
2 purchaser to be used primarily for photoprocessing, and
3 including photoprocessing machinery and equipment purchased
4 for lease.
5 (12) Coal exploration, mining, offhighway hauling,
6 processing, maintenance, and reclamation equipment, including
7 replacement parts and equipment, and including equipment
8 purchased for lease, but excluding motor vehicles required to
9 be registered under the Illinois Vehicle Code.
10 (13) (Blank). Food for human consumption that is to be
11 consumed off the premises where it is sold (other than
12 alcoholic beverages, soft drinks and food that has been
13 prepared for immediate consumption) and prescription and
14 non-prescription medicines, drugs, medical appliances, and
15 insulin, urine testing materials, syringes, and needles used
16 by diabetics, for human use, when purchased for use by a
17 person receiving medical assistance under Article 5 of the
18 Illinois Public Aid Code who resides in a licensed long-term
19 care facility, as defined in the Nursing Home Care Act.
20 (14) Semen used for artificial insemination of livestock
21 for direct agricultural production.
22 (15) Horses, or interests in horses, registered with and
23 meeting the requirements of any of the Arabian Horse Club
24 Registry of America, Appaloosa Horse Club, American Quarter
25 Horse Association, United States Trotting Association, or
26 Jockey Club, as appropriate, used for purposes of breeding or
27 racing for prizes.
28 (16) Computers and communications equipment utilized for
29 any hospital purpose and equipment used in the diagnosis,
30 analysis, or treatment of hospital patients sold to a lessor
31 who leases the equipment, under a lease of one year or longer
32 executed or in effect at the time of the purchase, to a
33 hospital that has been issued an active tax exemption
34 identification number by the Department under Section 1g of
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1 the Retailers' Occupation Tax Act.
2 (17) Personal property sold to a lessor who leases the
3 property, under a lease of one year or longer executed or in
4 effect at the time of the purchase, to a governmental body
5 that has been issued an active tax exemption identification
6 number by the Department under Section 1g of the Retailers'
7 Occupation Tax Act.
8 (18) Beginning with taxable years ending on or after
9 December 31, 1995 and ending with taxable years ending on or
10 before December 31, 2004, personal property that is donated
11 for disaster relief to be used in a State or federally
12 declared disaster area in Illinois or bordering Illinois by a
13 manufacturer or retailer that is registered in this State to
14 a corporation, society, association, foundation, or
15 institution that has been issued a sales tax exemption
16 identification number by the Department that assists victims
17 of the disaster who reside within the declared disaster area.
18 (19) Beginning with taxable years ending on or after
19 December 31, 1995 and ending with taxable years ending on or
20 before December 31, 2004, personal property that is used in
21 the performance of infrastructure repairs in this State,
22 including but not limited to municipal roads and streets,
23 access roads, bridges, sidewalks, waste disposal systems,
24 water and sewer line extensions, water distribution and
25 purification facilities, storm water drainage and retention
26 facilities, and sewage treatment facilities, resulting from a
27 State or federally declared disaster in Illinois or bordering
28 Illinois when such repairs are initiated on facilities
29 located in the declared disaster area within 6 months after
30 the disaster.
31 (20) Beginning July 1, 1999, game or game birds sold at
32 a "game breeding and hunting preserve area" or an "exotic
33 game hunting area" as those terms are used in the Wildlife
34 Code or at a hunting enclosure approved through rules adopted
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1 by the Department of Natural Resources. This paragraph is
2 exempt from the provisions of Section 3-55.
3 (21) (20) A motor vehicle, as that term is defined in
4 Section 1-146 of the Illinois Vehicle Code, that is donated
5 to a corporation, limited liability company, society,
6 association, foundation, or institution that is determined by
7 the Department to be organized and operated exclusively for
8 educational purposes. For purposes of this exemption, "a
9 corporation, limited liability company, society, association,
10 foundation, or institution organized and operated exclusively
11 for educational purposes" means all tax-supported public
12 schools, private schools that offer systematic instruction in
13 useful branches of learning by methods common to public
14 schools and that compare favorably in their scope and
15 intensity with the course of study presented in tax-supported
16 schools, and vocational or technical schools or institutes
17 organized and operated exclusively to provide a course of
18 study of not less than 6 weeks duration and designed to
19 prepare individuals to follow a trade or to pursue a manual,
20 technical, mechanical, industrial, business, or commercial
21 occupation.
22 (22) (21) Beginning January 1, 2000, personal property,
23 including food, purchased through fundraising events for the
24 benefit of a public or private elementary or secondary
25 school, a group of those schools, or one or more school
26 districts if the events are sponsored by an entity recognized
27 by the school district that consists primarily of volunteers
28 and includes parents and teachers of the school children.
29 This paragraph does not apply to fundraising events (i) for
30 the benefit of private home instruction or (ii) for which the
31 fundraising entity purchases the personal property sold at
32 the events from another individual or entity that sold the
33 property for the purpose of resale by the fundraising entity
34 and that profits from the sale to the fundraising entity.
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1 This paragraph is exempt from the provisions of Section 3-55.
2 (23) (20) Beginning January 1, 2000, new or used
3 automatic vending machines that prepare and serve hot food
4 and beverages, including coffee, soup, and other items, and
5 replacement parts for these machines. This paragraph is
6 exempt from the provisions of Section 3-55.
7 (Source: P.A. 90-14, eff. 7-1-97; 90-552, eff. 12-12-97;
8 90-605, eff. 6-30-98; 91-51, eff. 6-30-99; 91-200, eff.
9 7-20-99; 91-439, eff. 8-6-99; 91-533, eff. 8-13-99; 91-637,
10 eff. 8-20-99; 91-644, eff. 8-20-99; revised 9-29-99.)
11 (35 ILCS 115/20) (from Ch. 120, par. 439.120)
12 Sec. 20. If it is determined that the Department should
13 issue a credit or refund hereunder, the Department may first
14 apply the amount thereof against any amount of tax or penalty
15 or interest due hereunder, or under the Service Use Tax Act,
16 the Retailers' Occupation Tax Act, the Use Tax Act, any local
17 occupation or use tax administered by the Department the
18 Municipal Retailers' Occupation Tax Act, the Municipal Use
19 Tax Act, the Municipal Service Occupation Tax Act, the County
20 Retailers' Occupation Tax Act, the County Supplementary
21 Retailers' Occupation Tax Act, the County Service Occupation
22 Tax Act, the County Supplementary Service Occupation Tax Act,
23 the County Use Tax Act, the County Supplementary Use Tax Act,
24 Section 4 of the Water Commission Act of 1985, subsections
25 (b), (c) and (d) of Section 5.01 of the Local Mass Transit
26 District Act, or subsections (e), (f) and (g) of Section 4.03
27 of the Regional Transportation Authority Act, from the person
28 entitled to such credit or refund. For this purpose, if
29 proceedings are pending to determine whether or not any tax
30 or penalty or interest is due hereunder, or under the Service
31 Use Tax Act, the Retailers' Occupation Tax Act, the Use Tax
32 Act, any local occupation or use tax administered by the
33 Department the Municipal Retailers' Occupation Tax Act, the
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1 Municipal Use Tax Act, the Municipal Service Occupation Tax
2 Act, the County Retailers' Occupation Tax Act, the County
3 Supplementary Retailers' Occupation Tax Act, the County
4 Service Occupation Tax Act, the County Supplementary Service
5 Occupation Tax Act, the County Use Tax Act, the County
6 Supplementary Use Tax Act, Section 4 of the Water Commission
7 Act of 1985, subsections (b), (c) and (d) of Section 5.01 of
8 the Local Mass Transit District Act, or subsections (e), (f)
9 and (g) of Section 4.03 of the Regional Transportation
10 Authority Act, from such person, the Department may withhold
11 issuance of the credit or refund pending the final
12 disposition of such proceedings and may apply such credit or
13 refund against any amount found to be due to the Department
14 as a result of such proceedings. The balance, if any, of the
15 credit or refund shall be issued to the person entitled
16 thereto.
17 Any credit memorandum issued hereunder may be used by the
18 authorized holder thereof to pay any tax or penalty or
19 interest due or to become due under this Act, or under the
20 Service Use Tax Act, the Retailers' Occupation Tax Act, the
21 Use Tax Act, any local occupation or use tax administered by
22 the Department the Municipal Retailers' Occupation Tax Act,
23 the Municipal Use Tax Act, the Municipal Service Occupation
24 Tax Act, the County Retailers' Occupation Tax Act, the County
25 Supplementary Retailers' Occupation Tax Act, the County
26 Service Occupation Tax Act, the County Supplementary Service
27 Occupation Tax Act, the County Use Tax Act, the County
28 Supplementary Use Tax Act, Section 4 of the Water Commission
29 Act of 1985, subsections (b), (c) and (d) of Section 5.01 of
30 the Local Mass Transit District Act, or subsections (e), (f)
31 and (g) of Section 4.03 of the Regional Transportation
32 Authority Act, from such holder. Subject to reasonable rules
33 of the Department, a credit memorandum issued hereunder may
34 be assigned by the holder thereof to any other person for use
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1 in paying tax or penalty or interest which may be due or
2 become due under this Act, the Service Use Tax Act, the
3 Retailers' Occupation Tax Act, the Use Tax Act, any local
4 occupation or use tax administered by the Department the
5 Municipal Retailers' Occupation Tax Act, the Municipal Use
6 Tax Act, the Municipal Service Occupation Tax Act, the County
7 Retailers' Occupation Tax Act, the County Supplementary
8 Retailers' Occupation Tax Act, the County Service Occupation
9 Tax Act, the County Supplementary Service Occupation Tax Act,
10 the County Use Tax Act, the County Supplementary Use Tax Act,
11 Section 4 of the Water Commission Act of 1985, subsections
12 (b), (c) and (d) of Section 5.01 of the Local Mass Transit
13 District Act, or subsections (e), (f) and (g) of Section 4.03
14 of the Regional Transportation Authority Act, from the
15 assignee.
16 In any case in which there has been an erroneous refund
17 of tax payable under this Act, a notice of tax liability may
18 be issued at any time within 3 years from the making of that
19 refund, or within 5 years from the making of that refund if
20 it appears that any part of the refund was induced by fraud
21 or the misrepresentation of a material fact. The amount of
22 any proposed assessment set forth in the notice shall be
23 limited to the amount of the erroneous refund.
24 (Source: P.A. 87-876.)
25 Section 25. The Retailers' Occupation Tax Act is amended
26 by changing Sections 3 and 6 as follows:
27 (35 ILCS 120/3) (from Ch. 120, par. 442)
28 Sec. 3. Except as provided in this Section, on or before
29 the twentieth day of each calendar month, every person
30 engaged in the business of selling tangible personal property
31 at retail in this State during the preceding calendar month
32 shall file a return with the Department, stating:
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1 1. The name of the seller;
2 2. His residence address and the address of his
3 principal place of business and the address of the
4 principal place of business (if that is a different
5 address) from which he engages in the business of selling
6 tangible personal property at retail in this State;
7 3. Total amount of receipts received by him during
8 the preceding calendar month or quarter, as the case may
9 be, from sales of tangible personal property, and from
10 services furnished, by him during such preceding calendar
11 month or quarter;
12 4. Total amount received by him during the
13 preceding calendar month or quarter on charge and time
14 sales of tangible personal property, and from services
15 furnished, by him prior to the month or quarter for which
16 the return is filed;
17 5. Deductions allowed by law;
18 6. Gross receipts which were received by him during
19 the preceding calendar month or quarter and upon the
20 basis of which the tax is imposed;
21 7. The amount of credit provided in Section 2d of
22 this Act;
23 8. The amount of tax due;
24 9. The signature of the taxpayer; and
25 10. Such other reasonable information as the
26 Department may require.
27 If a taxpayer fails to sign a return within 30 days after
28 the proper notice and demand for signature by the Department,
29 the return shall be considered valid and any amount shown to
30 be due on the return shall be deemed assessed.
31 Each return shall be accompanied by the statement of
32 prepaid tax issued pursuant to Section 2e for which credit is
33 claimed.
34 A retailer may accept a Manufacturer's Purchase Credit
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1 certification from a purchaser in satisfaction of Use Tax as
2 provided in Section 3-85 of the Use Tax Act if the purchaser
3 provides the appropriate documentation as required by Section
4 3-85 of the Use Tax Act. A Manufacturer's Purchase Credit
5 certification, accepted by a retailer as provided in Section
6 3-85 of the Use Tax Act, may be used by that retailer to
7 satisfy Retailers' Occupation Tax liability in the amount
8 claimed in the certification, not to exceed 6.25% of the
9 receipts subject to tax from a qualifying purchase.
10 The Department may require returns to be filed on a
11 quarterly basis. If so required, a return for each calendar
12 quarter shall be filed on or before the twentieth day of the
13 calendar month following the end of such calendar quarter.
14 The taxpayer shall also file a return with the Department for
15 each of the first two months of each calendar quarter, on or
16 before the twentieth day of the following calendar month,
17 stating:
18 1. The name of the seller;
19 2. The address of the principal place of business
20 from which he engages in the business of selling tangible
21 personal property at retail in this State;
22 3. The total amount of taxable receipts received by
23 him during the preceding calendar month from sales of
24 tangible personal property by him during such preceding
25 calendar month, including receipts from charge and time
26 sales, but less all deductions allowed by law;
27 4. The amount of credit provided in Section 2d of
28 this Act;
29 5. The amount of tax due; and
30 6. Such other reasonable information as the
31 Department may require.
32 If a total amount of less than $1 is payable, refundable
33 or creditable, such amount shall be disregarded if it is less
34 than 50 cents and shall be increased to $1 if it is 50 cents
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1 or more.
2 Beginning October 1, 1993, a taxpayer who has an average
3 monthly tax liability of $150,000 or more shall make all
4 payments required by rules of the Department by electronic
5 funds transfer. Beginning October 1, 1994, a taxpayer who
6 has an average monthly tax liability of $100,000 or more
7 shall make all payments required by rules of the Department
8 by electronic funds transfer. Beginning October 1, 1995, a
9 taxpayer who has an average monthly tax liability of $50,000
10 or more shall make all payments required by rules of the
11 Department by electronic funds transfer. Beginning October
12 1, 2000, a taxpayer who has an annual tax liability of
13 $200,000 or more shall make all payments required by rules of
14 the Department by electronic funds transfer. The term
15 "annual tax liability" shall be the sum of the taxpayer's
16 liabilities under this Act, and under all other State and
17 local occupation and use tax laws administered by the
18 Department, for the immediately preceding calendar year. The
19 term "average monthly tax liability" shall be the sum of the
20 taxpayer's liabilities under this Act, and under all other
21 State and local occupation and use tax laws administered by
22 the Department, for the immediately preceding calendar year
23 divided by 12.
24 Before August 1 of each year beginning in 1993, the
25 Department shall notify all taxpayers required to make
26 payments by electronic funds transfer. All taxpayers
27 required to make payments by electronic funds transfer shall
28 make those payments for a minimum of one year beginning on
29 October 1.
30 Any taxpayer not required to make payments by electronic
31 funds transfer may make payments by electronic funds transfer
32 with the permission of the Department.
33 All taxpayers required to make payment by electronic
34 funds transfer and any taxpayers authorized to voluntarily
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1 make payments by electronic funds transfer shall make those
2 payments in the manner authorized by the Department.
3 The Department shall adopt such rules as are necessary to
4 effectuate a program of electronic funds transfer and the
5 requirements of this Section.
6 Any amount which is required to be shown or reported on
7 any return or other document under this Act shall, if such
8 amount is not a whole-dollar amount, be increased to the
9 nearest whole-dollar amount in any case where the fractional
10 part of a dollar is 50 cents or more, and decreased to the
11 nearest whole-dollar amount where the fractional part of a
12 dollar is less than 50 cents.
13 If the retailer is otherwise required to file a monthly
14 return and if the retailer's average monthly tax liability to
15 the Department does not exceed $200, the Department may
16 authorize his returns to be filed on a quarter annual basis,
17 with the return for January, February and March of a given
18 year being due by April 20 of such year; with the return for
19 April, May and June of a given year being due by July 20 of
20 such year; with the return for July, August and September of
21 a given year being due by October 20 of such year, and with
22 the return for October, November and December of a given year
23 being due by January 20 of the following year.
24 If the retailer is otherwise required to file a monthly
25 or quarterly return and if the retailer's average monthly tax
26 liability with the Department does not exceed $50, the
27 Department may authorize his returns to be filed on an annual
28 basis, with the return for a given year being due by January
29 20 of the following year.
30 Such quarter annual and annual returns, as to form and
31 substance, shall be subject to the same requirements as
32 monthly returns.
33 Notwithstanding any other provision in this Act
34 concerning the time within which a retailer may file his
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1 return, in the case of any retailer who ceases to engage in a
2 kind of business which makes him responsible for filing
3 returns under this Act, such retailer shall file a final
4 return under this Act with the Department not more than one
5 month after discontinuing such business.
6 Where the same person has more than one business
7 registered with the Department under separate registrations
8 under this Act, such person may not file each return that is
9 due as a single return covering all such registered
10 businesses, but shall file separate returns for each such
11 registered business.
12 In addition, with respect to motor vehicles, watercraft,
13 aircraft, and trailers that are required to be registered
14 with an agency of this State, every retailer selling this
15 kind of tangible personal property shall file, with the
16 Department, upon a form to be prescribed and supplied by the
17 Department, a separate return for each such item of tangible
18 personal property which the retailer sells, except that if
19 where, in the same transaction, (i) a retailer of aircraft,
20 watercraft, motor vehicles or trailers transfers more than
21 one aircraft, watercraft, motor vehicle or trailer to another
22 aircraft, watercraft, motor vehicle retailer or trailer
23 retailer for the purpose of resale or (ii) a retailer of
24 aircraft, watercraft, motor vehicles, or trailers transfers
25 more than one aircraft, watercraft, motor vehicle, or trailer
26 to a purchaser for use as a qualifying rolling stock as
27 provided in Section 2-5 of this Act, then that seller for
28 resale may report the transfer of all aircraft, watercraft,
29 motor vehicles or trailers involved in that transaction to
30 the Department on the same uniform invoice-transaction
31 reporting return form. For purposes of this Section,
32 "watercraft" means a Class 2, Class 3, or Class 4 watercraft
33 as defined in Section 3-2 of the Boat Registration and Safety
34 Act, a personal watercraft, or any boat equipped with an
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1 inboard motor.
2 Any retailer who sells only motor vehicles, watercraft,
3 aircraft, or trailers that are required to be registered with
4 an agency of this State, so that all retailers' occupation
5 tax liability is required to be reported, and is reported, on
6 such transaction reporting returns and who is not otherwise
7 required to file monthly or quarterly returns, need not file
8 monthly or quarterly returns. However, those retailers shall
9 be required to file returns on an annual basis.
10 The transaction reporting return, in the case of motor
11 vehicles or trailers that are required to be registered with
12 an agency of this State, shall be the same document as the
13 Uniform Invoice referred to in Section 5-402 of The Illinois
14 Vehicle Code and must show the name and address of the
15 seller; the name and address of the purchaser; the amount of
16 the selling price including the amount allowed by the
17 retailer for traded-in property, if any; the amount allowed
18 by the retailer for the traded-in tangible personal property,
19 if any, to the extent to which Section 1 of this Act allows
20 an exemption for the value of traded-in property; the balance
21 payable after deducting such trade-in allowance from the
22 total selling price; the amount of tax due from the retailer
23 with respect to such transaction; the amount of tax collected
24 from the purchaser by the retailer on such transaction (or
25 satisfactory evidence that such tax is not due in that
26 particular instance, if that is claimed to be the fact); the
27 place and date of the sale; a sufficient identification of
28 the property sold; such other information as is required in
29 Section 5-402 of The Illinois Vehicle Code, and such other
30 information as the Department may reasonably require.
31 The transaction reporting return in the case of
32 watercraft or aircraft must show the name and address of the
33 seller; the name and address of the purchaser; the amount of
34 the selling price including the amount allowed by the
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1 retailer for traded-in property, if any; the amount allowed
2 by the retailer for the traded-in tangible personal property,
3 if any, to the extent to which Section 1 of this Act allows
4 an exemption for the value of traded-in property; the balance
5 payable after deducting such trade-in allowance from the
6 total selling price; the amount of tax due from the retailer
7 with respect to such transaction; the amount of tax collected
8 from the purchaser by the retailer on such transaction (or
9 satisfactory evidence that such tax is not due in that
10 particular instance, if that is claimed to be the fact); the
11 place and date of the sale, a sufficient identification of
12 the property sold, and such other information as the
13 Department may reasonably require.
14 Such transaction reporting return shall be filed not
15 later than 20 days after the day of delivery of the item that
16 is being sold, but may be filed by the retailer at any time
17 sooner than that if he chooses to do so. The transaction
18 reporting return and tax remittance or proof of exemption
19 from the Illinois use tax may be transmitted to the
20 Department by way of the State agency with which, or State
21 officer with whom the tangible personal property must be
22 titled or registered (if titling or registration is required)
23 if the Department and such agency or State officer determine
24 that this procedure will expedite the processing of
25 applications for title or registration.
26 With each such transaction reporting return, the retailer
27 shall remit the proper amount of tax due (or shall submit
28 satisfactory evidence that the sale is not taxable if that is
29 the case), to the Department or its agents, whereupon the
30 Department shall issue, in the purchaser's name, a use tax
31 receipt (or a certificate of exemption if the Department is
32 satisfied that the particular sale is tax exempt) which such
33 purchaser may submit to the agency with which, or State
34 officer with whom, he must title or register the tangible
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1 personal property that is involved (if titling or
2 registration is required) in support of such purchaser's
3 application for an Illinois certificate or other evidence of
4 title or registration to such tangible personal property.
5 No retailer's failure or refusal to remit tax under this
6 Act precludes a user, who has paid the proper tax to the
7 retailer, from obtaining his certificate of title or other
8 evidence of title or registration (if titling or registration
9 is required) upon satisfying the Department that such user
10 has paid the proper tax (if tax is due) to the retailer. The
11 Department shall adopt appropriate rules to carry out the
12 mandate of this paragraph.
13 If the user who would otherwise pay tax to the retailer
14 wants the transaction reporting return filed and the payment
15 of the tax or proof of exemption made to the Department
16 before the retailer is willing to take these actions and such
17 user has not paid the tax to the retailer, such user may
18 certify to the fact of such delay by the retailer and may
19 (upon the Department being satisfied of the truth of such
20 certification) transmit the information required by the
21 transaction reporting return and the remittance for tax or
22 proof of exemption directly to the Department and obtain his
23 tax receipt or exemption determination, in which event the
24 transaction reporting return and tax remittance (if a tax
25 payment was required) shall be credited by the Department to
26 the proper retailer's account with the Department, but
27 without the 2.1% or 1.75% discount provided for in this
28 Section being allowed. When the user pays the tax directly
29 to the Department, he shall pay the tax in the same amount
30 and in the same form in which it would be remitted if the tax
31 had been remitted to the Department by the retailer.
32 Refunds made by the seller during the preceding return
33 period to purchasers, on account of tangible personal
34 property returned to the seller, shall be allowed as a
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1 deduction under subdivision 5 of his monthly or quarterly
2 return, as the case may be, in case the seller had
3 theretofore included the receipts from the sale of such
4 tangible personal property in a return filed by him and had
5 paid the tax imposed by this Act with respect to such
6 receipts.
7 Where the seller is a corporation, the return filed on
8 behalf of such corporation shall be signed by the president,
9 vice-president, secretary or treasurer or by the properly
10 accredited agent of such corporation.
11 Where the seller is a limited liability company, the
12 return filed on behalf of the limited liability company shall
13 be signed by a manager, member, or properly accredited agent
14 of the limited liability company.
15 Except as provided in this Section, the retailer filing
16 the return under this Section shall, at the time of filing
17 such return, pay to the Department the amount of tax imposed
18 by this Act less a discount of 2.1% prior to January 1, 1990
19 and 1.75% on and after January 1, 1990, or $5 per calendar
20 year, whichever is greater, which is allowed to reimburse the
21 retailer for the expenses incurred in keeping records,
22 preparing and filing returns, remitting the tax and supplying
23 data to the Department on request. Any prepayment made
24 pursuant to Section 2d of this Act shall be included in the
25 amount on which such 2.1% or 1.75% discount is computed. In
26 the case of retailers who report and pay the tax on a
27 transaction by transaction basis, as provided in this
28 Section, such discount shall be taken with each such tax
29 remittance instead of when such retailer files his periodic
30 return.
31 Before October 1, 2000, if the taxpayer's average monthly
32 tax liability to the Department under this Act, the Use Tax
33 Act, the Service Occupation Tax Act, and the Service Use Tax
34 Act, excluding any liability for prepaid sales tax to be
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1 remitted in accordance with Section 2d of this Act, was
2 $10,000 or more during the preceding 4 complete calendar
3 quarters, he shall file a return with the Department each
4 month by the 20th day of the month next following the month
5 during which such tax liability is incurred and shall make
6 payments to the Department on or before the 7th, 15th, 22nd
7 and last day of the month during which such liability is
8 incurred. On and after October 1, 2000, if the taxpayer's
9 average monthly tax liability to the Department under this
10 Act, the Use Tax Act, the Service Occupation Tax Act, and the
11 Service Use Tax Act, excluding any liability for prepaid
12 sales tax to be remitted in accordance with Section 2d of
13 this Act, was $20,000 or more during the preceding 4 complete
14 calendar quarters, he shall file a return with the Department
15 each month by the 20th day of the month next following the
16 month during which such tax liability is incurred and shall
17 make payment to the Department on or before the 7th, 15th,
18 22nd and last day of the month during which such liability is
19 incurred. If the month during which such tax liability is
20 incurred began prior to January 1, 1985, each payment shall
21 be in an amount equal to 1/4 of the taxpayer's actual
22 liability for the month or an amount set by the Department
23 not to exceed 1/4 of the average monthly liability of the
24 taxpayer to the Department for the preceding 4 complete
25 calendar quarters (excluding the month of highest liability
26 and the month of lowest liability in such 4 quarter period).
27 If the month during which such tax liability is incurred
28 begins on or after January 1, 1985 and prior to January 1,
29 1987, each payment shall be in an amount equal to 22.5% of
30 the taxpayer's actual liability for the month or 27.5% of the
31 taxpayer's liability for the same calendar month of the
32 preceding year. If the month during which such tax liability
33 is incurred begins on or after January 1, 1987 and prior to
34 January 1, 1988, each payment shall be in an amount equal to
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1 22.5% of the taxpayer's actual liability for the month or
2 26.25% of the taxpayer's liability for the same calendar
3 month of the preceding year. If the month during which such
4 tax liability is incurred begins on or after January 1, 1988,
5 and prior to January 1, 1989, or begins on or after January
6 1, 1996, each payment shall be in an amount equal to 22.5% of
7 the taxpayer's actual liability for the month or 25% of the
8 taxpayer's liability for the same calendar month of the
9 preceding year. If the month during which such tax liability
10 is incurred begins on or after January 1, 1989, and prior to
11 January 1, 1996, each payment shall be in an amount equal to
12 22.5% of the taxpayer's actual liability for the month or 25%
13 of the taxpayer's liability for the same calendar month of
14 the preceding year or 100% of the taxpayer's actual liability
15 for the quarter monthly reporting period. The amount of such
16 quarter monthly payments shall be credited against the final
17 tax liability of the taxpayer's return for that month.
18 Before October 1, 2000, once applicable, the requirement of
19 the making of quarter monthly payments to the Department by
20 taxpayers having an average monthly tax liability of $10,000
21 or more as determined in the manner provided above shall
22 continue until such taxpayer's average monthly liability to
23 the Department during the preceding 4 complete calendar
24 quarters (excluding the month of highest liability and the
25 month of lowest liability) is less than $9,000, or until such
26 taxpayer's average monthly liability to the Department as
27 computed for each calendar quarter of the 4 preceding
28 complete calendar quarter period is less than $10,000.
29 However, if a taxpayer can show the Department that a
30 substantial change in the taxpayer's business has occurred
31 which causes the taxpayer to anticipate that his average
32 monthly tax liability for the reasonably foreseeable future
33 will fall below the $10,000 threshold stated above, then such
34 taxpayer may petition the Department for a change in such
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1 taxpayer's reporting status. On and after October 1, 2000,
2 once applicable, the requirement of the making of quarter
3 monthly payments to the Department by taxpayers having an
4 average monthly tax liability of $20,000 or more as
5 determined in the manner provided above shall continue until
6 such taxpayer's average monthly liability to the Department
7 during the preceding 4 complete calendar quarters (excluding
8 the month of highest liability and the month of lowest
9 liability) is less than $19,000 or until such taxpayer's
10 average monthly liability to the Department as computed for
11 each calendar quarter of the 4 preceding complete calendar
12 quarter period is less than $20,000. However, if a taxpayer
13 can show the Department that a substantial change in the
14 taxpayer's business has occurred which causes the taxpayer to
15 anticipate that his average monthly tax liability for the
16 reasonably foreseeable future will fall below the $20,000
17 threshold stated above, then such taxpayer may petition the
18 Department for a change in such taxpayer's reporting status.
19 The Department shall change such taxpayer's reporting status
20 unless it finds that such change is seasonal in nature and
21 not likely to be long term. If any such quarter monthly
22 payment is not paid at the time or in the amount required by
23 this Section, then the taxpayer shall be liable for penalties
24 and interest on the difference between the minimum amount due
25 as a payment and the amount of such quarter monthly payment
26 actually and timely paid, except insofar as the taxpayer has
27 previously made payments for that month to the Department in
28 excess of the minimum payments previously due as provided in
29 this Section. The Department shall make reasonable rules and
30 regulations to govern the quarter monthly payment amount and
31 quarter monthly payment dates for taxpayers who file on other
32 than a calendar monthly basis.
33 Without regard to whether a taxpayer is required to make
34 quarter monthly payments as specified above, any taxpayer who
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1 is required by Section 2d of this Act to collect and remit
2 prepaid taxes and has collected prepaid taxes which average
3 in excess of $25,000 per month during the preceding 2
4 complete calendar quarters, shall file a return with the
5 Department as required by Section 2f and shall make payments
6 to the Department on or before the 7th, 15th, 22nd and last
7 day of the month during which such liability is incurred. If
8 the month during which such tax liability is incurred began
9 prior to the effective date of this amendatory Act of 1985,
10 each payment shall be in an amount not less than 22.5% of the
11 taxpayer's actual liability under Section 2d. If the month
12 during which such tax liability is incurred begins on or
13 after January 1, 1986, each payment shall be in an amount
14 equal to 22.5% of the taxpayer's actual liability for the
15 month or 27.5% of the taxpayer's liability for the same
16 calendar month of the preceding calendar year. If the month
17 during which such tax liability is incurred begins on or
18 after January 1, 1987, each payment shall be in an amount
19 equal to 22.5% of the taxpayer's actual liability for the
20 month or 26.25% of the taxpayer's liability for the same
21 calendar month of the preceding year. The amount of such
22 quarter monthly payments shall be credited against the final
23 tax liability of the taxpayer's return for that month filed
24 under this Section or Section 2f, as the case may be. Once
25 applicable, the requirement of the making of quarter monthly
26 payments to the Department pursuant to this paragraph shall
27 continue until such taxpayer's average monthly prepaid tax
28 collections during the preceding 2 complete calendar quarters
29 is $25,000 or less. If any such quarter monthly payment is
30 not paid at the time or in the amount required, the taxpayer
31 shall be liable for penalties and interest on such
32 difference, except insofar as the taxpayer has previously
33 made payments for that month in excess of the minimum
34 payments previously due.
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1 If any payment provided for in this Section exceeds the
2 taxpayer's liabilities under this Act, the Use Tax Act, the
3 Service Occupation Tax Act and the Service Use Tax Act, as
4 shown on an original monthly return, the Department shall, if
5 requested by the taxpayer, issue to the taxpayer a credit
6 memorandum no later than 30 days after the date of payment.
7 The credit evidenced by such credit memorandum may be
8 assigned by the taxpayer to a similar taxpayer under this
9 Act, the Use Tax Act, the Service Occupation Tax Act or the
10 Service Use Tax Act, in accordance with reasonable rules and
11 regulations to be prescribed by the Department. If no such
12 request is made, the taxpayer may credit such excess payment
13 against tax liability subsequently to be remitted to the
14 Department under this Act, the Use Tax Act, the Service
15 Occupation Tax Act or the Service Use Tax Act, in accordance
16 with reasonable rules and regulations prescribed by the
17 Department. If the Department subsequently determined that
18 all or any part of the credit taken was not actually due to
19 the taxpayer, the taxpayer's 2.1% and 1.75% vendor's discount
20 shall be reduced by 2.1% or 1.75% of the difference between
21 the credit taken and that actually due, and that taxpayer
22 shall be liable for penalties and interest on such
23 difference.
24 If a retailer of motor fuel is entitled to a credit under
25 Section 2d of this Act which exceeds the taxpayer's liability
26 to the Department under this Act for the month which the
27 taxpayer is filing a return, the Department shall issue the
28 taxpayer a credit memorandum for the excess.
29 Beginning January 1, 1990, each month the Department
30 shall pay into the Local Government Tax Fund, a special fund
31 in the State treasury which is hereby created, the net
32 revenue realized for the preceding month from the 1% tax on
33 sales of food for human consumption which is to be consumed
34 off the premises where it is sold (other than alcoholic
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1 beverages, soft drinks and food which has been prepared for
2 immediate consumption) and prescription and nonprescription
3 medicines, drugs, medical appliances and insulin, urine
4 testing materials, syringes and needles used by diabetics.
5 Beginning January 1, 1990, each month the Department
6 shall pay into the County and Mass Transit District Fund, a
7 special fund in the State treasury which is hereby created,
8 4% of the net revenue realized for the preceding month from
9 the 6.25% general rate.
10 Beginning January 1, 1990, each month the Department
11 shall pay into the Local Government Tax Fund 16% of the net
12 revenue realized for the preceding month from the 6.25%
13 general rate on the selling price of tangible personal
14 property.
15 Of the remainder of the moneys received by the Department
16 pursuant to this Act, (a) 1.75% thereof shall be paid into
17 the Build Illinois Fund and (b) prior to July 1, 1989, 2.2%
18 and on and after July 1, 1989, 3.8% thereof shall be paid
19 into the Build Illinois Fund; provided, however, that if in
20 any fiscal year the sum of (1) the aggregate of 2.2% or 3.8%,
21 as the case may be, of the moneys received by the Department
22 and required to be paid into the Build Illinois Fund pursuant
23 to this Act, Section 9 of the Use Tax Act, Section 9 of the
24 Service Use Tax Act, and Section 9 of the Service Occupation
25 Tax Act, such Acts being hereinafter called the "Tax Acts"
26 and such aggregate of 2.2% or 3.8%, as the case may be, of
27 moneys being hereinafter called the "Tax Act Amount", and (2)
28 the amount transferred to the Build Illinois Fund from the
29 State and Local Sales Tax Reform Fund shall be less than the
30 Annual Specified Amount (as hereinafter defined), an amount
31 equal to the difference shall be immediately paid into the
32 Build Illinois Fund from other moneys received by the
33 Department pursuant to the Tax Acts; the "Annual Specified
34 Amount" means the amounts specified below for fiscal years
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1 1986 through 1993:
2 Fiscal Year Annual Specified Amount
3 1986 $54,800,000
4 1987 $76,650,000
5 1988 $80,480,000
6 1989 $88,510,000
7 1990 $115,330,000
8 1991 $145,470,000
9 1992 $182,730,000
10 1993 $206,520,000;
11 and means the Certified Annual Debt Service Requirement (as
12 defined in Section 13 of the Build Illinois Bond Act) or the
13 Tax Act Amount, whichever is greater, for fiscal year 1994
14 and each fiscal year thereafter; and further provided, that
15 if on the last business day of any month the sum of (1) the
16 Tax Act Amount required to be deposited into the Build
17 Illinois Bond Account in the Build Illinois Fund during such
18 month and (2) the amount transferred to the Build Illinois
19 Fund from the State and Local Sales Tax Reform Fund shall
20 have been less than 1/12 of the Annual Specified Amount, an
21 amount equal to the difference shall be immediately paid into
22 the Build Illinois Fund from other moneys received by the
23 Department pursuant to the Tax Acts; and, further provided,
24 that in no event shall the payments required under the
25 preceding proviso result in aggregate payments into the Build
26 Illinois Fund pursuant to this clause (b) for any fiscal year
27 in excess of the greater of (i) the Tax Act Amount or (ii)
28 the Annual Specified Amount for such fiscal year. The
29 amounts payable into the Build Illinois Fund under clause (b)
30 of the first sentence in this paragraph shall be payable only
31 until such time as the aggregate amount on deposit under each
32 trust indenture securing Bonds issued and outstanding
33 pursuant to the Build Illinois Bond Act is sufficient, taking
34 into account any future investment income, to fully provide,
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1 in accordance with such indenture, for the defeasance of or
2 the payment of the principal of, premium, if any, and
3 interest on the Bonds secured by such indenture and on any
4 Bonds expected to be issued thereafter and all fees and costs
5 payable with respect thereto, all as certified by the
6 Director of the Bureau of the Budget. If on the last
7 business day of any month in which Bonds are outstanding
8 pursuant to the Build Illinois Bond Act, the aggregate of
9 moneys deposited in the Build Illinois Bond Account in the
10 Build Illinois Fund in such month shall be less than the
11 amount required to be transferred in such month from the
12 Build Illinois Bond Account to the Build Illinois Bond
13 Retirement and Interest Fund pursuant to Section 13 of the
14 Build Illinois Bond Act, an amount equal to such deficiency
15 shall be immediately paid from other moneys received by the
16 Department pursuant to the Tax Acts to the Build Illinois
17 Fund; provided, however, that any amounts paid to the Build
18 Illinois Fund in any fiscal year pursuant to this sentence
19 shall be deemed to constitute payments pursuant to clause (b)
20 of the first sentence of this paragraph and shall reduce the
21 amount otherwise payable for such fiscal year pursuant to
22 that clause (b). The moneys received by the Department
23 pursuant to this Act and required to be deposited into the
24 Build Illinois Fund are subject to the pledge, claim and
25 charge set forth in Section 12 of the Build Illinois Bond
26 Act.
27 Subject to payment of amounts into the Build Illinois
28 Fund as provided in the preceding paragraph or in any
29 amendment thereto hereafter enacted, the following specified
30 monthly installment of the amount requested in the
31 certificate of the Chairman of the Metropolitan Pier and
32 Exposition Authority provided under Section 8.25f of the
33 State Finance Act, but not in excess of sums designated as
34 "Total Deposit", shall be deposited in the aggregate from
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1 collections under Section 9 of the Use Tax Act, Section 9 of
2 the Service Use Tax Act, Section 9 of the Service Occupation
3 Tax Act, and Section 3 of the Retailers' Occupation Tax Act
4 into the McCormick Place Expansion Project Fund in the
5 specified fiscal years.
6 Fiscal Year Total Deposit
7 1993 $0
8 1994 53,000,000
9 1995 58,000,000
10 1996 61,000,000
11 1997 64,000,000
12 1998 68,000,000
13 1999 71,000,000
14 2000 75,000,000
15 2001 80,000,000
16 2002 84,000,000
17 2003 89,000,000
18 2004 93,000,000
19 2005 97,000,000
20 2006 102,000,000
21 2007 108,000,000
22 2008 115,000,000
23 2009 120,000,000
24 2010 126,000,000
25 2011 132,000,000
26 2012 138,000,000
27 2013 and 145,000,000
28 each fiscal year
29 thereafter that bonds
30 are outstanding under
31 Section 13.2 of the
32 Metropolitan Pier and
33 Exposition Authority
34 Act, but not after fiscal year 2029.
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1 Beginning July 20, 1993 and in each month of each fiscal
2 year thereafter, one-eighth of the amount requested in the
3 certificate of the Chairman of the Metropolitan Pier and
4 Exposition Authority for that fiscal year, less the amount
5 deposited into the McCormick Place Expansion Project Fund by
6 the State Treasurer in the respective month under subsection
7 (g) of Section 13 of the Metropolitan Pier and Exposition
8 Authority Act, plus cumulative deficiencies in the deposits
9 required under this Section for previous months and years,
10 shall be deposited into the McCormick Place Expansion Project
11 Fund, until the full amount requested for the fiscal year,
12 but not in excess of the amount specified above as "Total
13 Deposit", has been deposited.
14 Subject to payment of amounts into the Build Illinois
15 Fund and the McCormick Place Expansion Project Fund pursuant
16 to the preceding paragraphs or in any amendment thereto
17 hereafter enacted, each month the Department shall pay into
18 the Local Government Distributive Fund 0.4% of the net
19 revenue realized for the preceding month from the 5% general
20 rate or 0.4% of 80% of the net revenue realized for the
21 preceding month from the 6.25% general rate, as the case may
22 be, on the selling price of tangible personal property which
23 amount shall, subject to appropriation, be distributed as
24 provided in Section 2 of the State Revenue Sharing Act. No
25 payments or distributions pursuant to this paragraph shall be
26 made if the tax imposed by this Act on photoprocessing
27 products is declared unconstitutional, or if the proceeds
28 from such tax are unavailable for distribution because of
29 litigation.
30 Subject to payment of amounts into the Build Illinois
31 Fund, the McCormick Place Expansion Project to the preceding
32 paragraphs or in any amendments thereto hereafter enacted,
33 beginning July 1, 1993, the Department shall each month pay
34 into the Illinois Tax Increment Fund 0.27% of 80% of the net
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1 revenue realized for the preceding month from the 6.25%
2 general rate on the selling price of tangible personal
3 property.
4 Of the remainder of the moneys received by the Department
5 pursuant to this Act, 75% thereof shall be paid into the
6 State Treasury and 25% shall be reserved in a special account
7 and used only for the transfer to the Common School Fund as
8 part of the monthly transfer from the General Revenue Fund in
9 accordance with Section 8a of the State Finance Act.
10 The Department may, upon separate written notice to a
11 taxpayer, require the taxpayer to prepare and file with the
12 Department on a form prescribed by the Department within not
13 less than 60 days after receipt of the notice an annual
14 information return for the tax year specified in the notice.
15 Such annual return to the Department shall include a
16 statement of gross receipts as shown by the retailer's last
17 Federal income tax return. If the total receipts of the
18 business as reported in the Federal income tax return do not
19 agree with the gross receipts reported to the Department of
20 Revenue for the same period, the retailer shall attach to his
21 annual return a schedule showing a reconciliation of the 2
22 amounts and the reasons for the difference. The retailer's
23 annual return to the Department shall also disclose the cost
24 of goods sold by the retailer during the year covered by such
25 return, opening and closing inventories of such goods for
26 such year, costs of goods used from stock or taken from stock
27 and given away by the retailer during such year, payroll
28 information of the retailer's business during such year and
29 any additional reasonable information which the Department
30 deems would be helpful in determining the accuracy of the
31 monthly, quarterly or annual returns filed by such retailer
32 as provided for in this Section.
33 If the annual information return required by this Section
34 is not filed when and as required, the taxpayer shall be
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1 liable as follows:
2 (i) Until January 1, 1994, the taxpayer shall be
3 liable for a penalty equal to 1/6 of 1% of the tax due
4 from such taxpayer under this Act during the period to be
5 covered by the annual return for each month or fraction
6 of a month until such return is filed as required, the
7 penalty to be assessed and collected in the same manner
8 as any other penalty provided for in this Act.
9 (ii) On and after January 1, 1994, the taxpayer
10 shall be liable for a penalty as described in Section 3-4
11 of the Uniform Penalty and Interest Act.
12 The chief executive officer, proprietor, owner or highest
13 ranking manager shall sign the annual return to certify the
14 accuracy of the information contained therein. Any person
15 who willfully signs the annual return containing false or
16 inaccurate information shall be guilty of perjury and
17 punished accordingly. The annual return form prescribed by
18 the Department shall include a warning that the person
19 signing the return may be liable for perjury.
20 The provisions of this Section concerning the filing of
21 an annual information return do not apply to a retailer who
22 is not required to file an income tax return with the United
23 States Government.
24 As soon as possible after the first day of each month,
25 upon certification of the Department of Revenue, the
26 Comptroller shall order transferred and the Treasurer shall
27 transfer from the General Revenue Fund to the Motor Fuel Tax
28 Fund an amount equal to 1.7% of 80% of the net revenue
29 realized under this Act for the second preceding month.
30 Beginning April 1, 2000, this transfer is no longer required
31 and shall not be made.
32 Net revenue realized for a month shall be the revenue
33 collected by the State pursuant to this Act, less the amount
34 paid out during that month as refunds to taxpayers for
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1 overpayment of liability.
2 For greater simplicity of administration, manufacturers,
3 importers and wholesalers whose products are sold at retail
4 in Illinois by numerous retailers, and who wish to do so, may
5 assume the responsibility for accounting and paying to the
6 Department all tax accruing under this Act with respect to
7 such sales, if the retailers who are affected do not make
8 written objection to the Department to this arrangement.
9 Any person who promotes, organizes, provides retail
10 selling space for concessionaires or other types of sellers
11 at the Illinois State Fair, DuQuoin State Fair, county fairs,
12 local fairs, art shows, flea markets and similar exhibitions
13 or events, including any transient merchant as defined by
14 Section 2 of the Transient Merchant Act of 1987, is required
15 to file a report with the Department providing the name of
16 the merchant's business, the name of the person or persons
17 engaged in merchant's business, the permanent address and
18 Illinois Retailers Occupation Tax Registration Number of the
19 merchant, the dates and location of the event and other
20 reasonable information that the Department may require. The
21 report must be filed not later than the 20th day of the month
22 next following the month during which the event with retail
23 sales was held. Any person who fails to file a report
24 required by this Section commits a business offense and is
25 subject to a fine not to exceed $250.
26 Any person engaged in the business of selling tangible
27 personal property at retail as a concessionaire or other type
28 of seller at the Illinois State Fair, county fairs, art
29 shows, flea markets and similar exhibitions or events, or any
30 transient merchants, as defined by Section 2 of the Transient
31 Merchant Act of 1987, may be required to make a daily report
32 of the amount of such sales to the Department and to make a
33 daily payment of the full amount of tax due. The Department
34 shall impose this requirement when it finds that there is a
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1 significant risk of loss of revenue to the State at such an
2 exhibition or event. Such a finding shall be based on
3 evidence that a substantial number of concessionaires or
4 other sellers who are not residents of Illinois will be
5 engaging in the business of selling tangible personal
6 property at retail at the exhibition or event, or other
7 evidence of a significant risk of loss of revenue to the
8 State. The Department shall notify concessionaires and other
9 sellers affected by the imposition of this requirement. In
10 the absence of notification by the Department, the
11 concessionaires and other sellers shall file their returns as
12 otherwise required in this Section.
13 (Source: P.A. 90-491, eff. 1-1-99; 90-612, eff. 7-8-98;
14 91-37, eff. 7-1-99; 91-51, eff. 6-30-99; 91-101, eff.
15 7-12-99; 91-541, eff. 8-13-99; revised 9-29-99.)
16 (35 ILCS 120/6) (from Ch. 120, par. 445)
17 Sec. 6. Credit memorandum or refund. If it appears, after
18 claim therefor filed with the Department, that an amount of
19 tax or penalty or interest has been paid which was not due
20 under this Act, whether as the result of a mistake of fact or
21 an error of law, except as hereinafter provided, then the
22 Department shall issue a credit memorandum or refund to the
23 person who made the erroneous payment or, if that person died
24 or became a person under legal disability, to his or her
25 legal representative, as such. For purposes of this Section,
26 the tax is deemed to be erroneously paid by a retailer when
27 the manufacturer of a motor vehicle sold by the retailer
28 accepts the return of that automobile and refunds to the
29 purchaser the selling price of that vehicle as provided in
30 the New Vehicle Buyer Protection Act. When a motor vehicle is
31 returned for a refund of the purchase price under the New
32 Vehicle Buyer Protection Act, the Department shall issue a
33 credit memorandum or a refund for the amount of tax paid by
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1 the retailer under this Act attributable to the initial sale
2 of that vehicle. Claims submitted by the retailer are subject
3 to the same restrictions and procedures provided for in this
4 Act. If it is determined that the Department should issue a
5 credit memorandum or refund, the Department may first apply
6 the amount thereof against any tax or penalty or interest due
7 or to become due under this Act or under the Use Tax Act, the
8 Service Occupation Tax Act, the Service Use Tax Act, any
9 local occupation or use tax administered by the Department
10 the Municipal Retailers' Occupation Tax Act, the Municipal
11 Use Tax Act, the Municipal Service Occupation Tax Act, the
12 County Retailers' Occupation Tax Act, the County
13 Supplementary Retailers' Occupation Tax Act, the County
14 Service Occupation Tax Act, the County Supplementary Service
15 Occupation Tax Act, the County Use Tax Act, the County
16 Supplementary Use Tax Act, Section 4 of the Water Commission
17 Act of 1985, subsections (b), (c) and (d) of Section 5.01 of
18 the Local Mass Transit District Act, or subsections (e), (f)
19 and (g) of Section 4.03 of the Regional Transportation
20 Authority Act, from the person who made the erroneous
21 payment. If no tax or penalty or interest is due and no
22 proceeding is pending to determine whether such person is
23 indebted to the Department for tax or penalty or interest,
24 the credit memorandum or refund shall be issued to the
25 claimant; or (in the case of a credit memorandum) the credit
26 memorandum may be assigned and set over by the lawful holder
27 thereof, subject to reasonable rules of the Department, to
28 any other person who is subject to this Act, the Use Tax Act,
29 the Service Occupation Tax Act, the Service Use Tax Act, any
30 local occupation or use tax administered by the Department
31 the Municipal Retailers' Occupation Tax Act, the Municipal
32 Use Tax Act, the Municipal Service Occupation Tax Act, the
33 County Retailers' Occupation Tax Act, the County
34 Supplementary Retailers' Occupation Tax Act, the County
-137- LRB9110442SMdvB
1 Service Occupation Tax Act, the County Supplementary Service
2 Occupation Tax Act, the County Use Tax Act, the County
3 Supplementary Use Tax Act, Section 4 of the Water Commission
4 Act of 1985, subsections (b), (c) and (d) of Section 5.01 of
5 the Local Mass Transit District Act, or subsections (e), (f)
6 and (g) of Section 4.03 of the Regional Transportation
7 Authority Act, and the amount thereof applied by the
8 Department against any tax or penalty or interest due or to
9 become due under this Act or under the Use Tax Act, the
10 Service Occupation Tax Act, the Service Use Tax Act, any
11 local occupation or use tax administered by the Department
12 the Municipal Retailers' Occupation Tax Act, the Municipal
13 Use Tax Act, the Municipal Service Occupation Tax Act, the
14 County Retailers' Occupation Tax Act, the County
15 Supplementary Retailers' Occupation Tax Act, the County
16 Service Occupation Tax Act, the County Supplementary Service
17 Occupation Tax Act, the County Use Tax Act, the County
18 Supplementary Use Tax Act, Section 4 of the Water Commission
19 Act of 1985, subsections (b), (c) and (d) of Section 5.01 of
20 the Local Mass Transit District Act, or subsections (e), (f)
21 and (g) of Section 4.03 of the Regional Transportation
22 Authority Act, from such assignee. However, as to any claim
23 for credit or refund filed with the Department on and after
24 each January 1 and July 1 no amount of tax or penalty or
25 interest erroneously paid (either in total or partial
26 liquidation of a tax or penalty or amount of interest under
27 this Act) more than 3 years prior to such January 1 and July
28 1, respectively, shall be credited or refunded, except that
29 if both the Department and the taxpayer have agreed to an
30 extension of time to issue a notice of tax liability as
31 provided in Section 4 of this Act, such claim may be filed at
32 any time prior to the expiration of the period agreed upon.
33 No claim may be allowed for any amount paid to the
34 Department, whether paid voluntarily or involuntarily, if
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1 paid in total or partial liquidation of an assessment which
2 had become final before the claim for credit or refund to
3 recover the amount so paid is filed with the Department, or
4 if paid in total or partial liquidation of a judgment or
5 order of court. No credit may be allowed or refund made for
6 any amount paid by or collected from any claimant unless it
7 appears (a) that the claimant bore the burden of such amount
8 and has not been relieved thereof nor reimbursed therefor and
9 has not shifted such burden directly or indirectly through
10 inclusion of such amount in the price of the tangible
11 personal property sold by him or her or in any manner
12 whatsoever; and that no understanding or agreement, written
13 or oral, exists whereby he or she or his or her legal
14 representative may be relieved of the burden of such amount,
15 be reimbursed therefor or may shift the burden thereof; or
16 (b) that he or she or his or her legal representative has
17 repaid unconditionally such amount to his or her vendee (1)
18 who bore the burden thereof and has not shifted such burden
19 directly or indirectly, in any manner whatsoever; (2) who, if
20 he or she has shifted such burden, has repaid unconditionally
21 such amount to his own vendee; and (3) who is not entitled to
22 receive any reimbursement therefor from any other source than
23 from his or her vendor, nor to be relieved of such burden in
24 any manner whatsoever. No credit may be allowed or refund
25 made for any amount paid by or collected from any claimant
26 unless it appears that the claimant has unconditionally
27 repaid, to the purchaser, any amount collected from the
28 purchaser and retained by the claimant with respect to the
29 same transaction under the Use Tax Act.
30 Any credit or refund that is allowed under this Section
31 shall bear interest at the rate and in the manner specified
32 in the Uniform Penalty and Interest Act.
33 In case the Department determines that the claimant is
34 entitled to a refund, such refund shall be made only from
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1 such appropriation as may be available for that purpose. If
2 it appears unlikely that the amount appropriated would permit
3 everyone having a claim allowed during the period covered by
4 such appropriation to elect to receive a cash refund, the
5 Department, by rule or regulation, shall provide for the
6 payment of refunds in hardship cases and shall define what
7 types of cases qualify as hardship cases.
8 If a retailer who has failed to pay retailers' occupation
9 tax on gross receipts from retail sales is required by the
10 Department to pay such tax, such retailer, without filing any
11 formal claim with the Department, shall be allowed to take
12 credit against such retailers' occupation tax liability to
13 the extent, if any, to which such retailer has paid an amount
14 equivalent to retailers' occupation tax or has paid use tax
15 in error to his or her vendor or vendors of the same tangible
16 personal property which such retailer bought for resale and
17 did not first use before selling it, and no penalty or
18 interest shall be charged to such retailer on the amount of
19 such credit. However, when such credit is allowed to the
20 retailer by the Department, the vendor is precluded from
21 refunding any of that tax to the retailer and filing a claim
22 for credit or refund with respect thereto with the
23 Department. The provisions of this amendatory Act shall be
24 applied retroactively, regardless of the date of the
25 transaction.
26 (Source: P.A. 89-359, eff. 8-17-95.)
27 Section 30. The Cigarette Tax Act is amended by changing
28 Sections 4 and 6 as follows:
29 (35 ILCS 130/4) (from Ch. 120, par. 453.4)
30 Sec. 4. Distributor's license. No person may engage in
31 business as a distributor of cigarettes in this State within
32 the meaning of the first 2 definitions of distributor in
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1 Section 1 of this Act without first having obtained a license
2 therefor from the Department. Application for license shall
3 be made to the Department in form as furnished and prescribed
4 by the Department. Each applicant for a license under this
5 Section shall furnish to the Department on the form signed
6 and verified by the applicant the following information:
7 (a) The name and address of the applicant;
8 (b) The address of the location at which the applicant
9 proposes to engage in business as a distributor of cigarettes
10 in this State;
11 (c) Such other additional information as the Department
12 may lawfully require by its rules and regulations.
13 The annual license fee payable to the Department for each
14 distributor's license shall be $250. The purpose of such
15 annual license fee is to defray the cost, to the Department,
16 of coding, serializing or coding and serializing cigarette
17 tax stamps. Each applicant for license shall pay such fee to
18 the Department at the time of submitting his application for
19 license to the Department.
20 Every applicant who is required to procure a
21 distributor's license shall file with his application a joint
22 and several bond. Such bond shall be executed to the
23 Department of Revenue, with good and sufficient surety or
24 sureties residing or licensed to do business within the State
25 of Illinois, in the amount of $2,500, conditioned upon the
26 true and faithful compliance by the licensee with all of the
27 provisions of this Act. Such bond, or a reissue thereof, or a
28 substitute therefor, shall be kept in effect during the
29 entire period covered by the license. A separate application
30 for license shall be made, a separate annual license fee
31 paid, and a separate bond filed, for each place of business
32 at which a person who is required to procure a distributor's
33 license under this Section proposes to engage in business as
34 a distributor in Illinois under this Act.
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1 The following are ineligible to receive a distributor's
2 license under this Act:
3 (1) a person who is not of good character and reputation
4 in the community in which he resides;
5 (2) a person who has been convicted of a felony under
6 any Federal or State law, if the Department, after
7 investigation and a hearing, if requested by the applicant,
8 determines that such person has not been sufficiently
9 rehabilitated to warrant the public trust;
10 (3) a corporation, if any officer, manager or director
11 thereof, or any stockholder or stockholders owning in the
12 aggregate more than 5% of the stock of such corporation,
13 would not be eligible to receive a license under this Act for
14 any reason.
15 The Department, upon receipt of an application, license
16 fee and bond in proper form, from a person who is eligible to
17 receive a distributor's license under this Act, shall issue
18 to such applicant a license in form as prescribed by the
19 Department, which license shall permit the applicant to which
20 it is issued to engage in business as a distributor at the
21 place shown in his application. All licenses issued by the
22 Department under this Act shall be valid for not to exceed
23 one year after issuance unless sooner revoked, canceled or
24 suspended as provided in this Act. No license issued under
25 this Act is transferable or assignable. Such license shall be
26 conspicuously displayed in the place of business conducted by
27 the licensee in Illinois under such license.
28 Any person aggrieved by any decision of the Department
29 under this Section may, within 20 days after notice of the
30 decision, protest and request a hearing. Upon receiving a
31 request for a hearing, the Department shall give notice to
32 the person requesting the hearing of the time and place fixed
33 for the hearing and shall hold a hearing in conformity with
34 the provisions of this Act and then issue its final
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1 administrative decision in the matter to that person. In the
2 absence of a protest and request for a hearing within 20
3 days, the Department's decision shall become final without
4 any further determination being made or notice given.
5 (Source: P.A. 78-255.)
6 (35 ILCS 130/6) (from Ch. 120, par. 453.6)
7 Sec. 6. Revocation, cancellation, or suspension of
8 license. The Department may, after notice and hearing as
9 provided for by this Act, revoke, cancel or suspend the
10 license of any distributor for the violation of any provision
11 of this Act, or for noncompliance with any provision herein
12 contained, or for any noncompliance with any lawful rule or
13 regulation promulgated by the Department under Section 8 of
14 this Act, or because the licensee is determined to be
15 ineligible for a distributor's license for any one or more of
16 the reasons provided for in Section 4 of this Act. However,
17 no such license shall be revoked, cancelled or suspended,
18 except after a hearing by the Department with notice to the
19 distributor, as aforesaid, and affording such distributor a
20 reasonable opportunity to appear and defend, and any
21 distributor aggrieved by any decision of the Department with
22 respect thereto may have the determination of the Department
23 judicially reviewed, as herein provided. Notice of such
24 hearing shall be in writing and shall contain a statement of
25 the charges preferred against the distributor.
26 Any distributor aggrieved by any decision of the
27 Department under this Section may, within 20 days after
28 notice of the decision, protest and request a hearing. Upon
29 receiving a request for a hearing, the Department shall give
30 notice in writing to the distributor requesting the hearing
31 that contains a statement of the charges preferred against
32 the distributor and that states the time and place fixed for
33 the hearing. The Department shall hold the hearing in
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1 conformity with the provisions of this Act and then issue its
2 final administrative decision in the matter to the
3 distributor. In the absence of a protest and request for a
4 hearing within 20 days, the Department's decision shall
5 become final without any further determination being made or
6 notice given.
7 No license so revoked, as aforesaid, shall be reissued to
8 any such distributor within a period of 6 months after the
9 date of the final determination of such revocation. No such
10 license shall be reissued at all so long as the person who
11 would receive the license is ineligible to receive a
12 distributor's license under this Act for any one or more of
13 the reasons provided for in Section 4 of this Act.
14 The Department upon complaint filed in the circuit court
15 may by injunction restrain any person who fails, or refuses,
16 to comply with any of the provisions of this Act from acting
17 as a distributor of cigarettes in this State.
18 (Source: P.A. 79-1365; 79-1366.)
19 Section 35. The Cigarette Use Tax Act is amended by
20 changing Sections 4 and 6 as follows:
21 (35 ILCS 135/4) (from Ch. 120, par. 453.34)
22 Sec. 4. Distributor's license. A distributor maintaining
23 a place of business in this State, if required to procure a
24 license or allowed to obtain a permit as a distributor under
25 the Cigarette Tax Act, need not obtain an additional license
26 or permit under this Act, but shall be deemed to be
27 sufficiently licensed or registered by virtue of his being
28 licensed or registered under the Cigarette Tax Act.
29 Every distributor maintaining a place of business in this
30 State, if not required to procure a license or allowed to
31 obtain a permit as a distributor under the Cigarette Tax Act,
32 shall make a verified application to the Department (upon a
-144- LRB9110442SMdvB
1 form prescribed and furnished by the Department) for a
2 license to act as a distributor under this Act. In completing
3 such application, the applicant shall furnish such
4 information as the Department may reasonably require.
5 The annual license fee payable to the Department for each
6 distributor's license shall be $250. The purpose of such
7 annual license fee is to defray the cost, to the Department,
8 of coding, serializing or coding and serializing cigarette
9 tax stamps. The applicant for license shall pay such fee to
10 the Department at the time of submitting the application for
11 license to the Department.
12 Such applicant shall file, with his application, a joint
13 and several bond. Such bond shall be executed to the
14 Department of Revenue, with good and sufficient surety or
15 sureties residing or licensed to do business within the State
16 of Illinois, in the amount of $2,500, conditioned upon the
17 true and faithful compliance by the licensee with all of the
18 provisions of this Act. Such bond, or a reissue thereof, or a
19 substitute therefor, shall be kept in effect during the
20 entire period covered by the license. A separate application
21 for license shall be made, a separate annual license fee
22 paid, and a separate bond filed, for each place of business
23 at or from which the applicant proposes to act as a
24 distributor under this Act and for which the applicant is not
25 required to procure a license or allowed to obtain a permit
26 as a distributor under the Cigarette Tax Act.
27 The following are ineligible to receive a distributor's
28 license under this Act:
29 (1) a person who is not of good character and reputation
30 in the community in which he resides;
31 (2) a person who has been convicted of a felony under
32 any Federal or State law, if the Department, after
33 investigation and a hearing, if requested by the applicant,
34 determines that such person has not been sufficiently
-145- LRB9110442SMdvB
1 rehabilitated to warrant the public trust;
2 (3) a corporation, if any officer, manager or director
3 thereof, or any stockholder or stockholders owning in the
4 aggregate more than 5% of the stock of such corporation,
5 would not be eligible to receive a license hereunder for any
6 reason.
7 Upon approval of such application and bond and payment of
8 the required annual license fee, the Department shall issue a
9 license to the applicant. Such license shall permit the
10 applicant to engage in business as a distributor at or from
11 the place shown in his application. All licenses issued by
12 the Department under this Act shall be valid for not to
13 exceed one year after issuance unless sooner revoked,
14 canceled or suspended as in this Act provided. No license
15 issued under this Act is transferable or assignable. Such
16 license shall be conspicuously displayed at the place of
17 business for which it is issued.
18 Any person aggrieved by any decision of the Department
19 under this Section may, within 20 days after notice of the
20 decision, protest and request a hearing. Upon receiving a
21 request for a hearing, the Department shall give notice to
22 the person requesting the hearing of the time and place fixed
23 for the hearing and shall hold a hearing in conformity with
24 the provisions of this Act and then issue its final
25 administrative decision in the matter to that person. In the
26 absence of a protest and request for a hearing within 20
27 days, the Department's decision shall become final without
28 any further determination being made or notice given.
29 (Source: P.A. 78-255.)
30 (35 ILCS 135/6) (from Ch. 120, par. 453.36)
31 Sec. 6. Revocation, cancellation, or suspension of
32 license. The Department may, after notice and hearing as
33 provided for by this Act, revoke, cancel or suspend the
-146- LRB9110442SMdvB
1 license of any distributor for the violation of any provision
2 of this Act, or for non-compliance with any provision herein
3 contained, or for any non-compliance with any lawful rule or
4 regulation promulgated by the Department under Section 21 of
5 this Act, or because the licensee is determined to be
6 ineligible for a distributor's license for any one or more of
7 the reasons provided for in Section 4 of this Act. However,
8 no such license shall be revoked, canceled or suspended,
9 except after a hearing by the Department with notice to the
10 distributor, as aforesaid, and affording such distributor a
11 reasonable opportunity to appear and defend, and any
12 distributor aggrieved by any decision of the Department with
13 respect thereto may have the determination of the Department
14 judicially reviewed, as herein provided. Notice of such
15 hearing shall be in writing and shall contain a statement of
16 the charges preferred against the distributor.
17 Any distributor aggrieved by any decision of the
18 Department under this Section may, within 20 days after
19 notice of the decision, protest and request a hearing. Upon
20 receiving a request for a hearing, the Department shall give
21 notice in writing to the distributor requesting the hearing
22 that contains a statement of the charges preferred against
23 the distributor and that states the time and place fixed for
24 the hearing. The Department shall hold the hearing in
25 conformity with the provisions of this Act and then issue its
26 final administrative decision in the matter to the
27 distributor. In the absence of a protest and request for a
28 hearing within 20 days, the Department's decision shall
29 become final without any further determination being made or
30 notice given.
31 No license so revoked, shall be reissued to any such
32 distributor within a period of 6 months after the date of the
33 final determination of such revocation. No such license
34 shall be reissued at all so long as the person who would
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1 receive the license is ineligible to receive a distributor's
2 license under this Act for any one or more of the reasons
3 provided for in Section 4 of this Act.
4 The Department upon complaint filed in the circuit court
5 may by injunction restrain any person who fails, or refuses,
6 to comply with this Act from acting as a distributor of
7 cigarettes in this State.
8 (Source: P.A. 79-1365; 79-1366.)
9 Section 99. Effective date. This Act takes effect
10 January 1, 2001.
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1 INDEX
2 Statutes amended in order of appearance
3 35 ILCS 5/201 from Ch. 120, par. 2-201
4 35 ILCS 5/203 from Ch. 120, par. 2-203
5 35 ILCS 5/405
6 35 ILCS 5/803 from Ch. 120, par. 8-803
7 35 ILCS 5/1501 from Ch. 120, par. 15-1501
8 35 ILCS 105/3-5 from Ch. 120, par. 439.3-5
9 35 ILCS 105/3-70 from Ch. 120, par. 439.3-70
10 35 ILCS 105/9 from Ch. 120, par. 439.9
11 35 ILCS 105/10 from Ch. 120, par. 439.10
12 35 ILCS 105/22 from Ch. 120, par. 439.22
13 35 ILCS 110/20 from Ch. 120, par. 439.50
14 35 ILCS 115/3-5 from Ch. 120, par. 439.103-5
15 35 ILCS 115/20 from Ch. 120, par. 439.120
16 35 ILCS 120/3 from Ch. 120, par. 442
17 35 ILCS 120/6 from Ch. 120, par. 445
18 35 ILCS 130/4 from Ch. 120, par. 453.4
19 35 ILCS 130/6 from Ch. 120, par. 453.6
20 35 ILCS 135/4 from Ch. 120, par. 453.34
21 35 ILCS 135/6 from Ch. 120, par. 453.36