Bill Text: IL SB2378 | 2013-2014 | 98th General Assembly | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Amends the Illinois Income Tax Act and the Retailers' Occupation Tax Act. Provides that the time limitation period on the Department of Revenue's right to file a notice of lien shall not run during the term of a repayment plan that taxpayer has entered into with the Department, as long as taxpayer remains in compliance with the terms of the repayment plan. Effective immediately.
Spectrum: Slight Partisan Bill (Democrat 3-1)
Status: (Passed) 2013-08-05 - Public Act . . . . . . . . . 98-0179 [SB2378 Detail]
Download: Illinois-2013-SB2378-Introduced.html
Bill Title: Amends the Illinois Income Tax Act and the Retailers' Occupation Tax Act. Provides that the time limitation period on the Department of Revenue's right to file a notice of lien shall not run during the term of a repayment plan that taxpayer has entered into with the Department, as long as taxpayer remains in compliance with the terms of the repayment plan. Effective immediately.
Spectrum: Slight Partisan Bill (Democrat 3-1)
Status: (Passed) 2013-08-05 - Public Act . . . . . . . . . 98-0179 [SB2378 Detail]
Download: Illinois-2013-SB2378-Introduced.html
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1 | AN ACT concerning State government.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 5. The Illinois Income Tax Act is amended by | ||||||||||||||||||||||||||
5 | changing Section 1101 as follows:
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6 | (35 ILCS 5/1101) (from Ch. 120, par. 11-1101)
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7 | Sec. 1101. Lien for Tax. | ||||||||||||||||||||||||||
8 | (a) If any person liable to pay any tax
neglects or refuses | ||||||||||||||||||||||||||
9 | to pay the same after demand, the amount (including any
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10 | interest, additional amount,
addition to tax, or assessable | ||||||||||||||||||||||||||
11 | penalty, together with any costs that may
accrue in addition | ||||||||||||||||||||||||||
12 | thereto) shall be a lien in favor of the State of
Illinois upon | ||||||||||||||||||||||||||
13 | all property and rights to property, whether real or
personal, | ||||||||||||||||||||||||||
14 | belonging to such person.
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15 | (b) Unless another date is specifically fixed by law, the | ||||||||||||||||||||||||||
16 | lien imposed
by subsection (a) of this Section shall arise at | ||||||||||||||||||||||||||
17 | the time the assessment is
made and shall continue until the | ||||||||||||||||||||||||||
18 | liability for the amount so assessed (or
a judgment against the | ||||||||||||||||||||||||||
19 | taxpayer arising out of such liability) is satisfied
or becomes | ||||||||||||||||||||||||||
20 | unenforceable by reason of lapse of time.
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21 | (c) Deficiency procedure. If the lien arises from an | ||||||||||||||||||||||||||
22 | assessment
pursuant to a notice of deficiency, such lien shall | ||||||||||||||||||||||||||
23 | not attach and the
notice referred to in this section shall not |
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1 | be filed until all proceedings
in court for review of such | ||||||
2 | assessment have terminated or the time for the
taking thereof | ||||||
3 | has expired without such proceedings being instituted.
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4 | (d) Notice of lien. The lien created by assessment shall
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5 | terminate unless a notice of lien is filed, as provided in | ||||||
6 | section 1103 hereof,
within 3 years from the date all | ||||||
7 | proceedings in court for the review of
such assessment have | ||||||
8 | terminated or the time for the taking thereof has
expired | ||||||
9 | without such proceedings being instituted. Where the lien | ||||||
10 | results
from the filing of a return without payment of the tax | ||||||
11 | or penalty shown
therein to be due, the lien shall terminate | ||||||
12 | unless a notice of lien is
filed within 3 years from the date | ||||||
13 | such return was filed with the
Department.
For the purposes of | ||||||
14 | this subsection (d), a tax return filed before the last
day | ||||||
15 | prescribed by law, including any extension thereof, shall be | ||||||
16 | deemed to
have been filed on such last day. The time limitation | ||||||
17 | period on the Department's right to file a notice of lien shall | ||||||
18 | not run (1) during any period of time in which the order of any | ||||||
19 | court has the effect of enjoining or restraining the Department | ||||||
20 | from filing such notice of lien , or (2) during the term of a | ||||||
21 | repayment plan that taxpayer has entered into with the | ||||||
22 | Department, as long as taxpayer remains in compliance with the | ||||||
23 | terms of the repayment plan .
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24 | (Source: P.A. 97-507, eff. 8-23-11.)
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25 | Section 10. The Retailers' Occupation Tax Act is amended by |
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1 | changing Section 5a as follows:
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2 | (35 ILCS 120/5a) (from Ch. 120, par. 444a)
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3 | Sec. 5a.
The Department shall have a lien for the tax | ||||||
4 | herein imposed or any
portion thereof, or for any penalty | ||||||
5 | provided for in this Act, or for any
amount of interest which | ||||||
6 | may be due as provided for in Section 5 of this
Act, upon all | ||||||
7 | the real and personal property of any person to whom a
final | ||||||
8 | assessment or revised final assessment has been issued as | ||||||
9 | provided in
this Act, or whenever a return is filed without | ||||||
10 | payment of the tax or
penalty shown therein to be due, | ||||||
11 | including all such property of such
persons acquired after | ||||||
12 | receipt of such assessment or filing of such return.
The | ||||||
13 | taxpayer is liable for the filing fee incurred by the | ||||||
14 | Department for
filing the lien and the filing fee incurred by | ||||||
15 | the Department to file the
release of that lien. The filing | ||||||
16 | fees shall be paid to the Department in
addition to payment of | ||||||
17 | the tax, penalty, and interest included in the amount of
the | ||||||
18 | lien.
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19 | However, where the lien arises because of the issuance of a | ||||||
20 | final
assessment or revised final assessment by the Department, | ||||||
21 | such lien shall
not attach and the notice hereinafter referred | ||||||
22 | to in this Section shall not
be filed until all proceedings in | ||||||
23 | court for review of such final assessment
or revised final | ||||||
24 | assessment have terminated or the time for the taking
thereof | ||||||
25 | has expired without such proceedings being instituted.
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1 | Upon the granting of a rehearing or departmental review | ||||||
2 | pursuant to
Section 4 or Section 5 of this Act after a lien has | ||||||
3 | attached, such lien
shall remain in full force except to the | ||||||
4 | extent to which the final
assessment may be reduced by a | ||||||
5 | revised final assessment following such
rehearing or review.
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6 | The lien created by the issuance of a final assessment | ||||||
7 | shall terminate
unless a notice of lien is filed, as provided | ||||||
8 | in Section 5b hereof,
within 3 years from the date all | ||||||
9 | proceedings in court for the review of
such final assessment | ||||||
10 | have terminated or the time for the taking thereof
has expired | ||||||
11 | without such proceedings being instituted, or (in the case of a
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12 | revised final assessment issued pursuant to a rehearing or | ||||||
13 | departmental
review) within 3 years from the date all | ||||||
14 | proceedings in court for the
review of such revised final | ||||||
15 | assessment have terminated or the time for the
taking thereof | ||||||
16 | has expired without such proceedings being instituted; and
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17 | where the lien results from the filing of a return without | ||||||
18 | payment of the
tax or penalty shown therein to be due, the lien | ||||||
19 | shall terminate unless a
notice of lien is filed, as provided | ||||||
20 | in Section 5b hereof, within 3 years
from the date when such | ||||||
21 | return is filed with the Department: Provided that
the time | ||||||
22 | limitation period on the Department's right to file a notice of
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23 | lien shall not run (1) during any period of time in which the | ||||||
24 | order of any
court has the effect of enjoining or restraining | ||||||
25 | the Department from filing
such notice of lien , or (2) during | ||||||
26 | the term of a repayment plan that taxpayer has entered into |
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1 | with the Department, as long as taxpayer remains in compliance | ||||||
2 | with the terms of the repayment plan .
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3 | If the Department finds that a taxpayer is about to depart | ||||||
4 | from the
State, or to conceal himself or his property, or to do | ||||||
5 | any other act
tending to prejudice or to render wholly or | ||||||
6 | partly ineffectual proceedings
to collect such tax unless such | ||||||
7 | proceedings are brought without delay, or
if the Department | ||||||
8 | finds that the collection of the amount due from any
taxpayer | ||||||
9 | will be jeopardized by delay, the Department shall give the
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10 | taxpayer notice of such findings and shall make demand for | ||||||
11 | immediate return
and payment of such tax, whereupon such tax | ||||||
12 | shall become immediately due
and payable. If the taxpayer, | ||||||
13 | within 5 days after such notice (or within
such extension of | ||||||
14 | time as the Department may grant), does not comply with
such | ||||||
15 | notice or show to the Department that the findings in such | ||||||
16 | notice are
erroneous, the Department may file a notice of | ||||||
17 | jeopardy assessment lien in
the office of the recorder of the | ||||||
18 | county in which any property of
the taxpayer may be located and | ||||||
19 | shall notify the taxpayer of such filing.
Such jeopardy | ||||||
20 | assessment lien shall have the same scope and effect as the
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21 | statutory lien hereinbefore provided for in this Section.
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22 | If the taxpayer believes that he does not owe some or all | ||||||
23 | of the tax for
which the jeopardy assessment lien against him | ||||||
24 | has been filed, or that no
jeopardy to the revenue in fact | ||||||
25 | exists, he may protest within 20 days after
being notified by | ||||||
26 | the Department of the filing of such jeopardy assessment
lien |
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1 | and request a hearing, whereupon the Department shall hold a | ||||||
2 | hearing
in conformity with the provisions of this Act and, | ||||||
3 | pursuant thereto, shall
notify the taxpayer of its findings as | ||||||
4 | to whether or not such jeopardy
assessment lien will be | ||||||
5 | released. If not, and if the taxpayer is aggrieved
by this | ||||||
6 | decision, he may file an action for judicial review
of such | ||||||
7 | final
determination of the Department in accordance with | ||||||
8 | Section 12 of this Act
and the Administrative Review Law. | ||||||
9 | On and after July 1, 2013, protests concerning matters that | ||||||
10 | are subject to the jurisdiction of the Illinois Independent Tax | ||||||
11 | Tribunal shall be filed with the Tribunal, and hearings on | ||||||
12 | those matters shall be held before the Tribunal in accordance | ||||||
13 | with the Illinois Independent Tax Tribunal Act of 2012. The | ||||||
14 | Tribunal shall
notify the taxpayer of its findings as to | ||||||
15 | whether or not such jeopardy
assessment lien will be released. | ||||||
16 | If not, and if the taxpayer is aggrieved
by this decision, he | ||||||
17 | may file an action for judicial review
of such final
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18 | determination of the Department in accordance with Section 12 | ||||||
19 | of this Act
and the Illinois Independent Tax Tribunal Act of | ||||||
20 | 2012. | ||||||
21 | With respect to protests filed with the Department prior to | ||||||
22 | July 1, 2013 that would otherwise be subject to the | ||||||
23 | jurisdiction of the Illinois Independent Tax Tribunal, the | ||||||
24 | taxpayer may elect to be subject to the provisions of the | ||||||
25 | Illinois Independent Tax Tribunal Act of 2012 at any time on or | ||||||
26 | after July 1, 2013, but not later than 30 days after the date |
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1 | on which the protest was filed. If made, the election shall be | ||||||
2 | irrevocable.
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3 | If, pursuant to such hearing (or after an independent | ||||||
4 | determination of
the facts by the Department without a | ||||||
5 | hearing), the Department or the Tribunal determines
that some | ||||||
6 | or all of the tax covered by the jeopardy assessment lien is | ||||||
7 | not
owed by the taxpayer, or that no jeopardy to the revenue | ||||||
8 | exists, or if on
judicial review the final judgment of the | ||||||
9 | court is that the taxpayer does
not owe some or all of the tax | ||||||
10 | covered by the jeopardy assessment lien
against him, or that no | ||||||
11 | jeopardy to the revenue exists, the Department
shall release | ||||||
12 | its jeopardy assessment lien to the extent of such finding of
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13 | nonliability for the tax, or to the extent of such finding of | ||||||
14 | no jeopardy
to the revenue.
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15 | The Department shall also release its jeopardy assessment | ||||||
16 | lien against
the taxpayer whenever the tax and penalty covered | ||||||
17 | by such lien, plus any
interest which may be due, are paid
and | ||||||
18 | the taxpayer has paid the Department in cash or by guaranteed | ||||||
19 | remittance
an amount representing the filing fee for the lien | ||||||
20 | and the filing fee for the
release of that lien. The Department | ||||||
21 | shall file that release of lien with the
recorder of the county | ||||||
22 | where that lien was filed.
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23 | Nothing in this Section shall be construed to give the | ||||||
24 | Department a
preference over the rights of any bona fide | ||||||
25 | purchaser, holder of a
security interest, mechanics | ||||||
26 | lienholder, mortgagee, or judgment lien
creditor arising prior |
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1 | to the filing of a regular
notice of lien or a notice of | ||||||
2 | jeopardy assessment lien in the office of the
recorder in the | ||||||
3 | county in which the property subject to the lien
is located: | ||||||
4 | Provided, however, that the word "bona fide", as used in this
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5 | Section shall not include any mortgage of real or personal | ||||||
6 | property or any
other credit transaction that results in the | ||||||
7 | mortgagee or the holder of the
security acting as trustee for | ||||||
8 | unsecured creditors of the taxpayer
mentioned in the notice of | ||||||
9 | lien who executed such chattel or real property
mortgage or the | ||||||
10 | document evidencing such credit transaction. Such lien
shall be | ||||||
11 | inferior to the lien of general taxes, special assessments and
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12 | special taxes heretofore or hereafter levied by any political | ||||||
13 | subdivision
of this State.
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14 | In case title to land to be affected by the notice of lien | ||||||
15 | or notice of
jeopardy assessment lien is registered under the | ||||||
16 | provisions of "An Act
concerning land titles", approved May 1, | ||||||
17 | 1897, as amended, such notice
shall be filed in the office of | ||||||
18 | the Registrar of Titles of the county
within which the property | ||||||
19 | subject to the lien is situated and shall be
entered upon the | ||||||
20 | register of titles as a memorial or charge upon each
folium of | ||||||
21 | the register of titles affected by such notice, and the
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22 | Department shall not have a preference over the rights of any | ||||||
23 | bona fide
purchaser, mortgagee, judgment creditor or other lien | ||||||
24 | holder arising prior
to the registration of such notice: | ||||||
25 | Provided, however, that the word "bona
fide" shall not include | ||||||
26 | any mortgage of real or personal property or any
other credit |
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1 | transaction that results in the mortgagee or the holder of the
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2 | security acting as trustee for unsecured creditors of the | ||||||
3 | taxpayer
mentioned in the notice of lien who executed such | ||||||
4 | chattel or real property
mortgage or the document evidencing | ||||||
5 | such credit transaction.
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6 | Such regular lien or jeopardy assessment lien shall not be | ||||||
7 | effective
against any purchaser with respect to any item in a | ||||||
8 | retailer's stock in
trade purchased from the retailer in the | ||||||
9 | usual course of such retailer's
business.
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10 | (Source: P.A. 97-1129, eff. 8-28-12.)
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11 | Section 99. Effective date. This Act takes effect upon | ||||||
12 | becoming law.
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