SB0795sam001 95TH GENERAL ASSEMBLY

Sen. Carol Ronen

Filed: 3/23/2007

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AMENDMENT TO SENATE BILL 795

AMENDMENT NO. ______. Amend Senate Bill 795 by replacing everything after the enacting clause with the following:

"Section 5. The Illinois Income Tax Act is amended by changing Section 917 and by adding Section 1409 as follows:

(35 ILCS 5/917) (from Ch. 120, par. 9-917)

Sec. 917. Confidentiality and information sharing.

(a) Confidentiality. Except as provided in this Section, all information received by the Department from returns filed under this Act, or from any investigation conducted under the provisions of this Act, shall be confidential, except for official purposes within the Department or pursuant to official procedures for collection of any State tax or pursuant to an investigation or audit by the Illinois State Scholarship Commission of a delinquent student loan or monetary award or enforcement of any civil or criminal penalty or sanction imposed by this Act or by another statute imposing a State tax, and any person who divulges any such information in any manner, except for such purposes and pursuant to order of the Director or in accordance with a proper judicial order, shall be guilty of a Class A misdemeanor. However, the provisions of this paragraph are not applicable to information furnished to (i) the Department of Healthcare and Family Services (formerly Department of Public Aid), State's Attorneys, and the Attorney General for child support enforcement purposes and (ii) a licensed attorney representing the taxpayer where an appeal or a protest has been filed on behalf of the taxpayer. If it is necessary to file information obtained pursuant to this Act in a child support enforcement proceeding, the information shall be filed under seal.

(b) Public information. Nothing contained in this Act shall prevent the Director from publishing or making available to the public the names and addresses of persons filing returns under this Act, or from publishing or making available reasonable statistics concerning the operation of the tax wherein the contents of returns are grouped into aggregates in such a way that the information contained in any individual return shall not be disclosed.

(c) Governmental agencies. The Director may make available to the Secretary of the Treasury of the United States or his delegate, or the proper officer or his delegate of any other state imposing a tax upon or measured by income, for exclusively official purposes, information received by the Department in the administration of this Act, but such permission shall be granted only if the United States or such other state, as the case may be, grants the Department substantially similar privileges. The Director may exchange information with the Department of Healthcare and Family Services and the Department of Human Services (acting as successor to the Department of Public Aid under the Department of Human Services Act) for the purpose of verifying sources and amounts of income and for other purposes directly connected with the administration of this Act and the Illinois Public Aid Code. The Director may exchange information with the Director of the Department of Employment Security for the purpose of verifying sources and amounts of income and for other purposes directly connected with the administration of this Act and Acts administered by the Department of Employment Security. The Director may make available to the Illinois Workers' Compensation Commission information regarding employers for the purpose of verifying the insurance coverage required under the Workers' Compensation Act and Workers' Occupational Diseases Act. The Director may exchange information with the Illinois Department on Aging for the purpose of verifying sources and amounts of income for purposes directly related to confirming eligibility for participation in the programs of benefits authorized by the Senior Citizens and Disabled Persons Property Tax Relief and Pharmaceutical Assistance Act.

The Director may make available to any State agency, including the Illinois Supreme Court, which licenses persons to engage in any occupation, information that a person licensed by such agency has failed to file returns under this Act or pay the tax, penalty and interest shown therein, or has failed to pay any final assessment of tax, penalty or interest due under this Act. The Director may make available to any State agency, including the Illinois Supreme Court, information regarding whether a bidder, contractor, or an affiliate of a bidder or contractor has failed to file returns under this Act or pay the tax, penalty, and interest shown therein, or has failed to pay any final assessment of tax, penalty, or interest due under this Act, for the limited purpose of enforcing bidder and contractor certifications. For purposes of this Section, the term "affiliate" means any entity that (1) directly, indirectly, or constructively controls another entity, (2) is directly, indirectly, or constructively controlled by another entity, or (3) is subject to the control of a common entity. For purposes of this subsection (a), an entity controls another entity if it owns, directly or individually, more than 10% of the voting securities of that entity. As used in this subsection (a), the term "voting security" means a security that (1) confers upon the holder the right to vote for the election of members of the board of directors or similar governing body of the business or (2) is convertible into, or entitles the holder to receive upon its exercise, a security that confers such a right to vote. A general partnership interest is a voting security.

The Director may make available to any State agency, including the Illinois Supreme Court, units of local government, and school districts, information regarding whether a bidder or contractor is an affiliate of a person who is not collecting and remitting Illinois Use taxes, for the limited purpose of enforcing bidder and contractor certifications.

The Director may also make available to the Secretary of State information that a corporation which has been issued a certificate of incorporation by the Secretary of State has failed to file returns under this Act or pay the tax, penalty and interest shown therein, or has failed to pay any final assessment of tax, penalty or interest due under this Act. An assessment is final when all proceedings in court for review of such assessment have terminated or the time for the taking thereof has expired without such proceedings being instituted. For taxable years ending on or after December 31, 1987, the Director may make available to the Director or principal officer of any Department of the State of Illinois, information that a person employed by such Department has failed to file returns under this Act or pay the tax, penalty and interest shown therein. For purposes of this paragraph, the word "Department" shall have the same meaning as provided in Section 3 of the State Employees Group Insurance Act of 1971.

(d) The Director shall make available for public inspection in the Department's principal office and for publication, at cost, administrative decisions issued on or after January 1, 1995. These decisions are to be made available in a manner so that the following taxpayer information is not disclosed:

(1) The names, addresses, and identification numbers of the taxpayer, related entities, and employees.

(2) At the sole discretion of the Director, trade secrets or other confidential information identified as such by the taxpayer, no later than 30 days after receipt of an administrative decision, by such means as the Department shall provide by rule.

The Director shall determine the appropriate extent of the deletions allowed in paragraph (2). In the event the taxpayer does not submit deletions, the Director shall make only the deletions specified in paragraph (1).

The Director shall make available for public inspection and publication an administrative decision within 180 days after the issuance of the administrative decision. The term "administrative decision" has the same meaning as defined in Section 3-101 of Article III of the Code of Civil Procedure. Costs collected under this Section shall be paid into the Tax Compliance and Administration Fund.

(e) Nothing contained in this Act shall prevent the Director from divulging information to any person pursuant to a request or authorization made by the taxpayer, by an authorized representative of the taxpayer, or, in the case of information related to a joint return, by the spouse filing the joint return with the taxpayer.

(f) Nothing contained in this Act prevents the Department from disclosing information from reports filed pursuant to Section 1409 of this Act. All such information may be made available for public inspection at the Department, or by any other means of publication, including the Internet, or under the Freedom of Information Act.

(Source: P.A. 93-25, eff. 6-20-03; 93-721, eff. 1-1-05; 93-835; 93-841, eff. 7-30-04; 94-1074, eff. 12-26-06.)

(35 ILCS 5/1409 new)

Sec. 1409. Information reports by public corporations, banks, and insurance companies.

(a) Beginning with November 1, 2007, and for each year thereafter, each corporation that is required to file reports under Section 13 of the Securities and Exchange Act of 1934, each corporation (other than a Subchapter S corporation) that has total assets of $100,000,000 as of November 1 of that year, each bank, each bank holding company, and each insurance company that is qualified to do business in this State and required to file a return under this Act, shall file with the Department an information report containing the following information:

(1) the name and address of the taxpayer, as shown on its Illinois income tax return;

(2) the gross receipts of the taxpayer for the period reported on its Illinois income tax return;

(3) the base income reported on its Illinois income tax return;

(4) the net income reported on its Illinois income tax return;

(5) the amount of each exemption, subtraction, or credit reported on its Illinois income tax return;

(6) any Illinois net loss carryover claimed on its Illinois income tax return;

(7) the income tax and Personal Property Replacement Income Tax liability, net of credits allowed under Article 2 of this Act, reported on its Illinois income tax return;

(8) the book income of the taxpayer filing the report for the period for which that taxpayers's Illinois income tax return is filed;

(9) in the case of a taxpayer whose commercial domicile is outside this State, the amount of net income allocated to its commercial domicile on its income or franchise tax return filed with the state of domicile;

(10) the number of full-time employees of the taxpayer filing the report to whom "compensation paid in this State" (within the meaning of Section 304(a)(2)(B) of this Act) was paid during the period for which the Illinois income tax return was filed; and

(11) in the case of a financial organization, the amount of interest from Illinois customers received outside this State.

(b) Reports required under this Section must be filed no late than November 1 of each year. The Department may, by rule, require any report under this Section to be filed electronically.

(c) A penalty is imposed for the failure to timely file any report that is due under this Section. The penalty is imposed for each day that the report is late at a rate equal to the greater of: (i) 1% of the liability imposed under subsections (a), (b), (c), and (d) of Section 201 of this Act on the Illinois income tax return; or (ii) either:

(A) for any day before the Department has issued a written request for the report $100; or

(B) for any day on or after the date that the Department has issued a written request for the report, $1,000.

A penalty is imposed for a failure to timely report the correct amount of any item required to be included in a report under this Section. The penalty is imposed for each day after the erroneous report is filed until a correct report is filed at a rate equal to the greater of: (i) 1% of the liability imposed under subsections (a), (b), (c), and (d) of Section 201 of this Act on the Illinois income tax return; or (ii) $100.

No penalty is imposed under this Section on any person who had a reasonable cause for failing to comply with this Section.

(d) For the purposes of this Section, "Illinois income tax return" means the most recent original Illinois income tax return filed prior to the due date of the information report required by this Section and on or after November 1 of the preceding year.

In the case of a combined return filed under Section 502(e) of this Act, the report required by this Section must be filed by the unitary business group on behalf of all of its members. "Illinois income tax return" is the combined Illinois income tax return of the unitary business group, and the information required on the report shall include the information of every member of the unitary business group regardless of whether any such member would be required to file an information report under this Section if it were not a member of a unitary business group.

Section 99. Effective date. This Act takes effect upon becoming law.".