Sen. Dan Kotowski
Filed: 5/5/2010
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1 | AMENDMENT TO HOUSE BILL 3659
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2 | AMENDMENT NO. ______. Amend House Bill 3659, AS AMENDED, by | ||||||
3 | replacing everything after the enacting clause with the | ||||||
4 | following:
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5 | "Section 1. Short title. This Act may be cited as the Oil | ||||||
6 | Company Gross Income Tax Act. | ||||||
7 | Section 5. Definitions. Except as otherwise expressly | ||||||
8 | provided or clearly appearing from the context, any term used | ||||||
9 | in this Act shall have the same meaning as when used in a | ||||||
10 | comparable context in the Illinois Income Tax Act, as in effect | ||||||
11 | for the taxable year. As used in this Act: | ||||||
12 | "Department" means the Department of Revenue. | ||||||
13 | "Gross income" of a taxpayer means the amount of gross | ||||||
14 | income properly reportable for federal income tax purposes for | ||||||
15 | the taxable year under the provisions of the Internal Revenue | ||||||
16 | Code, minus any amounts that are exempt from taxation by this |
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1 | State either by reason of its statutes or Constitution or by | ||||||
2 | reason of the Constitution, treaties or statutes of the United | ||||||
3 | States. | ||||||
4 | "Illinois gross income" of a taxpayer means the amount of | ||||||
5 | gross income of the taxpayer, multiplied by the apportionment | ||||||
6 | fraction of the taxpayer determined under Section 304 of the | ||||||
7 | Illinois Income Tax Act for the taxable year. | ||||||
8 | "Oil company" means any taxpayer primarily engaged in the | ||||||
9 | business (other than as an employee) of exploration, drilling, | ||||||
10 | importation, refining or wholesale distribution of petroleum | ||||||
11 | products, excluding retail sales of tangible personal property | ||||||
12 | for use or consumption, and not for resale. | ||||||
13 | "Petroleum products" means any products that contain or are | ||||||
14 | made from petroleum or a petroleum derivative. | ||||||
15 | "Taxpayer" means any person subject to tax under the | ||||||
16 | Illinois Income Tax Act. In the case of a unitary business | ||||||
17 | group as defined in Section 1501(a)(27) of the Illinois Income | ||||||
18 | Tax Act, "taxpayer" means the unitary business group, all | ||||||
19 | returns on behalf of the taxpayer shall be made by the | ||||||
20 | designated agent of the unitary business group and each member | ||||||
21 | of the unitary business group doing business in this State | ||||||
22 | shall be jointly and severally liable for the tax imposed under | ||||||
23 | this Act. | ||||||
24 | Section 10. Tax imposed. For taxable years ending on or | ||||||
25 | after December 31, 2011, a tax is hereby imposed on each oil |
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1 | company doing business in this State at the rate of 12% of the | ||||||
2 | Illinois gross income of the oil company. | ||||||
3 | Section 15. Returns and payments. | ||||||
4 | (a) In General. Except as provided by the Department by | ||||||
5 | rule, every taxpayer qualified to do business in this State at | ||||||
6 | any time during a taxable year shall make a return under this | ||||||
7 | Act for that taxable year. Returns required by this Act shall | ||||||
8 | be made in the form and manner prescribed by the Department, | ||||||
9 | and shall be filed on or before the due date (including | ||||||
10 | extensions) for filing of the taxpayer's Illinois income tax | ||||||
11 | return for the same taxable year under the Illinois Income Tax | ||||||
12 | Act. The Department may by rule require any return required | ||||||
13 | under this Act to be filed electronically. | ||||||
14 | (b) A taxpayer shall notify the Department if the federal | ||||||
15 | income tax liability of that taxpayer for any year is altered | ||||||
16 | by amendment of that taxpayer's federal income tax return or as | ||||||
17 | a result of any other recomputation or redetermination of | ||||||
18 | federal income tax liability, and such alteration reflects a | ||||||
19 | change or settlement with respect to any item or items | ||||||
20 | affecting the computation of such taxpayer's Illinois gross | ||||||
21 | income for any year under this Act. Such notification shall be | ||||||
22 | in the form of an amended return or such other form as the | ||||||
23 | Department may by rule prescribe, and shall be filed not later | ||||||
24 | than 120 days after such alteration has been agreed to or | ||||||
25 | finally determined for federal income tax purposes or any |
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1 | federal income tax deficiency or refund, abatement or credit | ||||||
2 | resulting therefrom has been assessed or paid, whichever shall | ||||||
3 | first occur. | ||||||
4 | (c) Every taxpayer required to file a return under this Act | ||||||
5 | shall, without assessment, notice or demand, pay any tax due | ||||||
6 | thereon to the Department, at the place fixed for filing, on or | ||||||
7 | before the date fixed for filing such return (including any | ||||||
8 | extension of time for filing the return) pursuant to rules | ||||||
9 | prescribed by the Department. | ||||||
10 | (d) Every taxpayer shall keep such records, render such | ||||||
11 | statements, make such returns and notices, and comply with such | ||||||
12 | rules and regulations as the Department may from time to time | ||||||
13 | prescribe. Whenever in the judgment of the Director it is | ||||||
14 | necessary, he may require any taxpayer, by notice served upon | ||||||
15 | such taxpayer or by regulations, to make such returns and | ||||||
16 | notices, render such statements, or keep such records, as the | ||||||
17 | Director deems sufficient to show whether or not such taxpayer | ||||||
18 | is liable for tax under this Act. | ||||||
19 | Section 20. Payment of Estimated Tax. | ||||||
20 | (a) For taxable years ending on or after December 31, 2011, | ||||||
21 | each taxpayer is required to pay estimated tax for the taxable | ||||||
22 | year, in such amount and with such forms as the Department | ||||||
23 | shall prescribe. | ||||||
24 | (b) There shall be paid 4 equal installments of estimated | ||||||
25 | tax for each taxable year, payable as follows: | ||||||
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6 | (c) Application to short taxable years. The application of | |||||||||||||||||||||
7 | this Section to taxable years of less than 12 months shall be | |||||||||||||||||||||
8 | in accordance with regulations prescribed by the Department. | |||||||||||||||||||||
9 | (d) Fiscal years. In the application of this Section to the | |||||||||||||||||||||
10 | case of a taxable year ending on any date other than December | |||||||||||||||||||||
11 | 31, there shall be substituted, for the months specified in | |||||||||||||||||||||
12 | subsection (b), the months which correspond thereto. | |||||||||||||||||||||
13 | (e) In case of any underpayment of estimated tax by a | |||||||||||||||||||||
14 | taxpayer, the taxpayer shall be liable to a penalty in an | |||||||||||||||||||||
15 | amount determined at the rate prescribed by Section 3-3 of the | |||||||||||||||||||||
16 | Uniform Penalty and Interest Act upon the amount of the | |||||||||||||||||||||
17 | underpayment for each required installment. | |||||||||||||||||||||
18 | (1) Amount of underpayment. For purposes of subsection | |||||||||||||||||||||
19 | (a), the amount of the underpayment shall be the excess of: | |||||||||||||||||||||
20 | (A) the amount of the installment which would be | |||||||||||||||||||||
21 | required to be paid under paragraph (2) of this | |||||||||||||||||||||
22 | subsection, over
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23 | (B) the amount, if any, of the installment paid on | |||||||||||||||||||||
24 | or before the last date prescribed for payment.
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25 | (2) Amount of Required Installments. The amount of any | |||||||||||||||||||||
26 | required installment shall be 25% of the required annual |
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1 | payment. The "required annual payment" means the lesser of | ||||||
2 | 90% of the tax shown on the return for the taxable year, or | ||||||
3 | if no return is filed, 90% of the tax for such year. | ||||||
4 | Section 25. Collection authority. The Department shall | ||||||
5 | collect the taxes imposed by this Act and shall deposit the | ||||||
6 | amounts collected into the General Revenue Fund in the State | ||||||
7 | treasury. | ||||||
8 | Section 30. Notice and Demand. | ||||||
9 | (a) In general. Except as provided in subsection (b) the | ||||||
10 | Director shall, as soon as practicable after an amount payable | ||||||
11 | under this Act is deemed assessed (as provided in Section 35 of | ||||||
12 | this Act), give notice to each taxpayer liable for any unpaid | ||||||
13 | portion of such assessment, stating the amount unpaid and | ||||||
14 | demanding payment thereof. In the case of tax deemed assessed | ||||||
15 | with the filing of a return, the Director shall give notice no | ||||||
16 | later than 3 years after the date the return was filed. Upon | ||||||
17 | receipt of any notice and demand there shall be paid at the | ||||||
18 | place and time stated in such notice the amount stated in such | ||||||
19 | notice. Such notice shall be left at the dwelling or usual | ||||||
20 | place of business of such taxpayer or shall be sent by mail to | ||||||
21 | the taxpayer's last known address. | ||||||
22 | (b) Judicial review. In the case of a deficiency deemed | ||||||
23 | assessed under Section 35(b) of this Act after the filing of a | ||||||
24 | protest, notice and demand shall not be made with respect to |
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1 | such assessment until all proceedings in court for the review | ||||||
2 | of such assessment have terminated or the time for the taking | ||||||
3 | thereof has expired without such proceedings being instituted. | ||||||
4 | Section 35. Assessment. | ||||||
5 | (a) Returns. The amount of tax which is shown to be due on | ||||||
6 | the return shall be deemed assessed on the date of filing of | ||||||
7 | the return (including any amended returns showing an increase | ||||||
8 | of tax). In the event that the amount of tax is understated on | ||||||
9 | the taxpayer's return due to a mathematical error, the | ||||||
10 | Department shall notify the taxpayer that the amount of tax in | ||||||
11 | excess of that shown on the return is due and has been | ||||||
12 | assessed. Such notice of additional tax due shall be issued no | ||||||
13 | later than 3 years after the date the return was filed. Such | ||||||
14 | notice of additional tax due shall not be considered a notice | ||||||
15 | of deficiency nor shall the taxpayer have any right of protest. | ||||||
16 | In the case of a return properly filed without the computation | ||||||
17 | of the tax, the tax computed by the Department shall be deemed | ||||||
18 | to be assessed on the date when payment is due. | ||||||
19 | (b) Notice of deficiency. If a notice of deficiency has | ||||||
20 | been issued, the amount of the deficiency shall be deemed | ||||||
21 | assessed on the date provided in Section 40(d) of this Act if | ||||||
22 | no protest is filed; or, if a protest is filed, then upon the | ||||||
23 | date when the decision of the Department becomes final. | ||||||
24 | (c) Payments. Any amount paid as tax or in respect of tax | ||||||
25 | paid under this Act, other than amounts paid as estimated tax |
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1 | under Section 20 of this Act, shall be deemed assessed upon the | ||||||
2 | date of receipt of payment, notwithstanding any other | ||||||
3 | provisions of this Act. | ||||||
4 | (d) Limitations on assessment. No deficiency shall be | ||||||
5 | assessed with respect to a taxable year for which a return was | ||||||
6 | filed unless a notice of deficiency for such year was issued | ||||||
7 | not later than the date prescribed in Section 45 of this Act. | ||||||
8 | Section 40. Deficiencies and overpayments. | ||||||
9 | (a) Examination of return. As soon as practicable after a | ||||||
10 | return is filed, the Department shall examine it to determine | ||||||
11 | the correct amount of tax. If the Department finds that the | ||||||
12 | amount of tax shown on the return is less than the correct | ||||||
13 | amount, it shall issue a notice of deficiency to the taxpayer | ||||||
14 | which shall set forth the amount of tax and penalties proposed | ||||||
15 | to be assessed. If the Department finds that the tax paid is | ||||||
16 | more than the correct amount, it shall credit or refund the | ||||||
17 | overpayment as provided by Section 55. The findings of the | ||||||
18 | Department under this subsection shall be prima facie correct | ||||||
19 | and shall be prima facie evidence of the correctness of the | ||||||
20 | amount of tax and penalties due. | ||||||
21 | (b) No return filed. If the taxpayer fails to file a tax | ||||||
22 | return, the Department shall determine the amount of tax due | ||||||
23 | according to its best judgment and information, which amount so | ||||||
24 | fixed by the Department shall be prima facie correct and shall | ||||||
25 | be prima facie evidence of the correctness of the amount of tax |
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1 | due. The Department shall issue a notice of deficiency to the | ||||||
2 | taxpayer which shall set forth the amount of tax and penalties | ||||||
3 | proposed to be assessed. | ||||||
4 | (c) Notice of deficiency. A notice of deficiency issued | ||||||
5 | under this Act shall set forth the adjustments giving rise to | ||||||
6 | the proposed assessment and the reasons therefor. | ||||||
7 | (d) Assessment when no protest. Upon the expiration of 60 | ||||||
8 | days (150 days if the taxpayer is outside the United States) | ||||||
9 | after the date on which it was issued, a notice of deficiency | ||||||
10 | shall constitute an assessment of the amount of tax and | ||||||
11 | penalties specified therein, except only for such amounts as to | ||||||
12 | which the taxpayer shall have filed a protest with the | ||||||
13 | Department, as provided in Section 50 of this Act. | ||||||
14 | Section 45. Limitations on notices of deficiency. | ||||||
15 | (a) In general. Except as otherwise provided in this Act: | ||||||
16 | (1) A notice of deficiency shall be issued not later | ||||||
17 | than 3 years after the date the return was filed, and
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18 | (2) No deficiency shall be assessed or collected with | ||||||
19 | respect to the year for which the return was filed unless | ||||||
20 | such notice is issued within such period.
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21 | (b) No return or fraudulent return. If no return is filed | ||||||
22 | or a false and fraudulent return is filed with intent to evade | ||||||
23 | the tax imposed by this Act, a notice of deficiency may be | ||||||
24 | issued at any time. | ||||||
25 | (c) Failure to report federal change. If a taxpayer fails |
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1 | to notify the Department in any case where notification is | ||||||
2 | required by Section 15 of this Act, a notice of deficiency may | ||||||
3 | be issued at any time for the taxable year for which the | ||||||
4 | notification is required; provided, however, that the amount of | ||||||
5 | any proposed assessment set forth in the notice shall be | ||||||
6 | limited to the amount of any deficiency resulting under this | ||||||
7 | Act from giving effect to the item or items required to be | ||||||
8 | reported. | ||||||
9 | (d) Report of federal change. In any case where | ||||||
10 | notification of an alteration is given as required by Section | ||||||
11 | 15 of this Act, a notice of deficiency may be issued at any | ||||||
12 | time within 2 years after the date such notification is given, | ||||||
13 | provided, however, that the amount of any proposed assessment | ||||||
14 | set forth in such notice shall be limited to the amount of any | ||||||
15 | deficiency resulting under this Act from giving effect to the | ||||||
16 | item or items reflected in the reported alteration. | ||||||
17 | (e) Change in Illinois income tax liability. In any case | ||||||
18 | where the taxpayer's Illinois income tax liability for a | ||||||
19 | taxable year is increased as the result of a change in the | ||||||
20 | taxpayer's apportionment fraction, a notice of deficiency for | ||||||
21 | any additional tax due under this Act as the result of the | ||||||
22 | change in the taxpayer's apportionment fraction may be issued | ||||||
23 | at any time within 2 years after the increased Illinois income | ||||||
24 | tax overpayment is assessed. | ||||||
25 | (f) Extension by agreement. Where, before the expiration of | ||||||
26 | the time prescribed in this section for the issuance of a |
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1 | notice of deficiency, both the Department and the taxpayer | ||||||
2 | shall have consented in writing to its issuance after such | ||||||
3 | time, such notice may be issued at any time prior to the | ||||||
4 | expiration of the period agreed upon. The period so agreed upon | ||||||
5 | may be extended by subsequent agreements in writing made before | ||||||
6 | the expiration of the period previously agreed upon. | ||||||
7 | (g) Erroneous refunds. In any case in which there has been | ||||||
8 | an erroneous refund of tax payable under this Act, a notice of | ||||||
9 | deficiency may be issued at any time within 2 years from the | ||||||
10 | making of such refund, or within 5 years from the making of | ||||||
11 | such refund if it appears that any part of the refund was | ||||||
12 | induced by fraud or the misrepresentation of a material fact, | ||||||
13 | provided, however, that the amount of any proposed assessment | ||||||
14 | set forth in such notice shall be limited to the amount of such | ||||||
15 | erroneous refund. | ||||||
16 | (h) Time return deemed filed. For purposes of this Section | ||||||
17 | a tax return filed before the last day prescribed by law | ||||||
18 | (including any extension thereof) shall be deemed to have been | ||||||
19 | filed on such last day. | ||||||
20 | Section 50. Procedure on protest. | ||||||
21 | (a) Time for protest. Within 60 days (150 days if the | ||||||
22 | taxpayer is outside the United States) after the issuance of a | ||||||
23 | notice of deficiency, the taxpayer may file with the Department | ||||||
24 | a written protest against the proposed assessment in such form | ||||||
25 | as the Department may by regulations prescribe, setting forth |
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1 | the grounds on which such protest is based. If a protest is | ||||||
2 | filed, the Department shall reconsider the proposed assessment | ||||||
3 | and, if the taxpayer has so requested, shall grant the taxpayer | ||||||
4 | or the taxpayer's authorized representative a hearing. | ||||||
5 | (b) Notice of decision. As soon as practicable after such | ||||||
6 | reconsideration and hearing, if any, the Department shall issue | ||||||
7 | a notice of decision by mailing such notice by certified or | ||||||
8 | registered mail. Such notice shall set forth briefly the | ||||||
9 | Department's findings of fact and the basis of decision in each | ||||||
10 | case decided in whole or in part adversely to the taxpayer. | ||||||
11 | (c) Request for rehearing. Within 30 days after the mailing | ||||||
12 | of a notice of decision, the taxpayer may file with a | ||||||
13 | Department a written request for rehearing in such form as the | ||||||
14 | Department may by regulations prescribe, setting forth the | ||||||
15 | grounds on which rehearing is requested. In any such case, the | ||||||
16 | Department shall, in its discretion, grant either a rehearing | ||||||
17 | or Departmental review unless, within 10 days of receipt of | ||||||
18 | such request, it shall issue a denial of such request by | ||||||
19 | mailing such denial to the taxpayer by certified or registered | ||||||
20 | mail. If rehearing or Departmental review is granted, as soon | ||||||
21 | as practicable after such rehearing or Departmental review, the | ||||||
22 | Department shall issue a notice of final decision as provided | ||||||
23 | in subsection (b). | ||||||
24 | (d) Finality of decision. The action of the Department on | ||||||
25 | the taxpayer's protest shall become final: | ||||||
26 | (1) 30 Days after issuance of a notice of decision as |
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1 | provided in subsection (b); or
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2 | (2) if a timely request for rehearing was made, upon | ||||||
3 | the issuance of a denial of such request or the issuance of | ||||||
4 | a notice of final decision as provided in subsection (c).
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5 | Section 55. Credits and refunds. | ||||||
6 | (a) In general. In the case of any overpayment, the | ||||||
7 | Department may credit the amount of such overpayment, including | ||||||
8 | any interest allowed thereon, against any liability in respect | ||||||
9 | of the tax imposed by this Act or any other act administered by | ||||||
10 | the Department or against any liability of the taxpayer | ||||||
11 | collectible by the Department, regardless of whether other | ||||||
12 | collection remedies are closed to the Department on the part of | ||||||
13 | the person who made the overpayment and shall refund any | ||||||
14 | balance to such person. The Department shall apply overpayments | ||||||
15 | to liabilities in the order provided in Section 911.3 of the | ||||||
16 | Illinois Income Tax Act. | ||||||
17 | (b) Credits against estimated tax. The Department may | ||||||
18 | prescribe regulations providing for the crediting against the | ||||||
19 | estimated tax for any taxable year of the amount determined by | ||||||
20 | the taxpayer or the Department to be an overpayment of the tax | ||||||
21 | imposed by this Act for a preceding taxable year. | ||||||
22 | (c) Interest on overpayment. Interest shall be allowed and | ||||||
23 | paid at the rate and in the manner prescribed in Section 3-2 of | ||||||
24 | the Uniform Penalty and Interest Act upon any overpayment in | ||||||
25 | respect of the tax imposed by this Act. For purposes of this |
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1 | subsection, no amount of tax, for any taxable year, shall be | ||||||
2 | treated as having been paid before the date on which the | ||||||
3 | payment of tax for such year was due under Section 15(c) of | ||||||
4 | this Act. | ||||||
5 | (d) Refund claim. Every claim for refund shall be filed | ||||||
6 | with the Department in writing in such form as the Department | ||||||
7 | may by regulations prescribe, and shall state the specific | ||||||
8 | grounds upon which it is founded. | ||||||
9 | (e) Notice of denial. As soon as practicable after a claim | ||||||
10 | for refund is filed, the Department shall examine it and either | ||||||
11 | issue a notice of refund, abatement or credit to the claimant | ||||||
12 | or issue a notice of denial. If the Department has failed to | ||||||
13 | approve or deny the claim before the expiration of 6 months | ||||||
14 | from the date the claim was filed, the claimant may | ||||||
15 | nevertheless thereafter file with the Department a written | ||||||
16 | protest in such form as the Department may by regulation | ||||||
17 | prescribe. If a protest is filed, the Department shall consider | ||||||
18 | the claim and, if the taxpayer has so requested, shall grant | ||||||
19 | the taxpayer or the taxpayer's authorized representative a | ||||||
20 | hearing within 6 months after the date such request is filed. | ||||||
21 | (f) Effect of denial. A denial of a claim for refund | ||||||
22 | becomes final 60 days after the date of issuance of the notice | ||||||
23 | of such denial except for such amounts denied as to which the | ||||||
24 | claimant has filed a protest with the Department, as provided | ||||||
25 | by Section 60 of this Act. |
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1 | Section 60. Procedure on denial of claim for refund. | ||||||
2 | (a) Time for protest. Within 60 days after the denial of | ||||||
3 | the claim, the claimant may file with the Department a written | ||||||
4 | protest against such denial in such form as the Department may | ||||||
5 | by regulations prescribe, setting forth the grounds on which | ||||||
6 | such protest is based. If a protest is filed, the Department | ||||||
7 | shall reconsider the denial and, if the taxpayer has so | ||||||
8 | requested, shall grant the taxpayer or his authorized | ||||||
9 | representative a hearing. | ||||||
10 | (b) Notice of decision. As soon as practicable after such | ||||||
11 | reconsideration and hearing, if any, the Department shall issue | ||||||
12 | a notice of decision by mailing such notice by certified or | ||||||
13 | registered mail. Such notice shall set forth briefly the | ||||||
14 | Department's findings of fact and the basis of decision in each | ||||||
15 | case decided in whole or in part adversely to the claimant. | ||||||
16 | (c) Request for rehearing. Within 30 days after the mailing | ||||||
17 | of a notice of decision, the claimant may file with the | ||||||
18 | Department a written request for rehearing in such form as the | ||||||
19 | Department may by regulations prescribe, setting forth the | ||||||
20 | grounds on which rehearing is requested. In any such case, the | ||||||
21 | Department shall, in its discretion, grant either a rehearing | ||||||
22 | or Departmental review unless, within 10 days of receipt of | ||||||
23 | such request, it shall issue a denial of such request by | ||||||
24 | mailing such denial to the claimant by certified or registered | ||||||
25 | mail. If rehearing or Departmental review is granted, as soon | ||||||
26 | as practicable after such rehearing or Departmental review, the |
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1 | Department shall issue a notice of final decision as provided | ||||||
2 | in subsection (b). | ||||||
3 | (d) Finality of decision. The action of the Department on | ||||||
4 | the claimant's protest shall become final: | ||||||
5 | (1) 30 days after issuance of a notice of decision as | ||||||
6 | provided in subsection (b); or
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7 | (2) If a timely request for rehearing was made, upon | ||||||
8 | the issuance of a denial of such request or the issuance of | ||||||
9 | a notice of final decision as provided in subsection (c).
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10 | Section 65. Limitations on claims for refund. | ||||||
11 | (a) In general. Except as otherwise provided in this Act: | ||||||
12 | (1) A claim for refund shall be filed not later than 3 | ||||||
13 | years after the date the return was filed, or one year | ||||||
14 | after the date the tax was paid, whichever is the later; | ||||||
15 | and
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16 | (2) No credit or refund shall be allowed or made with | ||||||
17 | respect to the year for which the claim was filed unless | ||||||
18 | such claim is filed within such period.
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19 | (b) Federal changes. In any case where notification of an | ||||||
20 | alteration is required by Section 15(b) of this Act, a claim | ||||||
21 | for refund may be filed within 2 years after the date on which | ||||||
22 | such notification was due (regardless of whether such notice | ||||||
23 | was given), but the amount recoverable pursuant to a claim | ||||||
24 | filed under this Section shall be limited to the amount of any | ||||||
25 | overpayment resulting under this Act from giving effect to the |
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1 | item or items reflected in the alteration required to be | ||||||
2 | reported. | ||||||
3 | (c) Change in Illinois income tax liability. In any case | ||||||
4 | where the taxpayer's Illinois income tax liability for a | ||||||
5 | taxable year is decreased as the result of a change in the | ||||||
6 | taxpayer's apportionment fraction, a claim refund of an | ||||||
7 | overpayment resulting from the change in the taxpayer's | ||||||
8 | apportionment fraction may be issued at any time within 2 years | ||||||
9 | after the decreased Illinois income tax overpayment is refunded | ||||||
10 | or credited. | ||||||
11 | (d) Extension by agreement. Where, before the expiration of | ||||||
12 | the time prescribed in this Section for the filing of a claim | ||||||
13 | for refund, both the Department and the claimant shall have | ||||||
14 | consented in writing to its filing after such time, such claim | ||||||
15 | may be filed at any time prior to the expiration of the period | ||||||
16 | agreed upon. The period so agreed upon may be extended by | ||||||
17 | subsequent agreements in writing made before the expiration of | ||||||
18 | the period previously agreed upon. | ||||||
19 | (e) Limit on amount of credit or refund. | ||||||
20 | (1) Limit where claim filed within 3-year period. If | ||||||
21 | the claim was filed by the claimant during the 3-year | ||||||
22 | period prescribed in subsection (a), the amount of the | ||||||
23 | credit or refund shall not exceed the portion of the tax | ||||||
24 | paid within the period, immediately preceding the filing of | ||||||
25 | the claim, equal to 3 years plus the period of any | ||||||
26 | extension of time for filing the return. |
| |||||||
| |||||||
1 | (2) Limit where claim not filed within 3-year period. | ||||||
2 | If the claim was not filed within such 3-year period, the | ||||||
3 | amount of the credit or refund shall not exceed the portion | ||||||
4 | of the tax paid during the one year immediately preceding | ||||||
5 | the filing of the claim. | ||||||
6 | (f) Time return deemed filed. For purposes of this Section | ||||||
7 | a tax return filed before the last day prescribed by law for | ||||||
8 | the filing of such return (including any extensions thereof) | ||||||
9 | shall be deemed to have been filed on such last day. | ||||||
10 | Section 70. Procedure and administration. The provisions | ||||||
11 | of Section 913, 914, 915, 916, 917 and 918 and Articles 10, 11, | ||||||
12 | 12, 13 and 14 of the Illinois Income Tax Act which are not | ||||||
13 | inconsistent with this Act shall apply, as far as practicable, | ||||||
14 | to the subject matter of this Act to the same extent as if such | ||||||
15 | provisions were included herein. | ||||||
16 | Section 75. The Illinois Income Tax Act is amended by | ||||||
17 | changing Sections 205, 901, and 1501 as follows: | ||||||
18 | (35 ILCS 5/205) (from Ch. 120, par. 2-205) | ||||||
19 | Sec. 205. Exempt organizations. | ||||||
20 | (a) Charitable, etc. organizations. The base income of an
| ||||||
21 | organization which is exempt from the federal income tax by | ||||||
22 | reason of
Section 501(a) of the Internal Revenue Code shall not | ||||||
23 | be determined
under section 203 of this Act, but shall be its |
| |||||||
| |||||||
1 | unrelated business
taxable income as determined under section | ||||||
2 | 512 of the Internal Revenue
Code, without any deduction for the | ||||||
3 | tax imposed by this Act. The
standard exemption provided by | ||||||
4 | section 204 of this Act shall not be
allowed in determining the | ||||||
5 | net income of an organization to which this
subsection applies. | ||||||
6 | (b) Partnerships. A partnership as such shall not be | ||||||
7 | subject to
the tax imposed by subsection 201 (a) and (b) of | ||||||
8 | this Act, but shall be
subject to the replacement tax imposed | ||||||
9 | by subsection 201 (c) and (d) of
this Act and shall compute its | ||||||
10 | base income as described in subsection (d)
of Section 203 of | ||||||
11 | this Act. For taxable years ending on or after December 31, | ||||||
12 | 2004, an investment partnership, as defined in Section | ||||||
13 | 1501(a)(11.5) of this Act, shall not be subject to the tax | ||||||
14 | imposed by subsections (c) and (d) of Section 201 of this Act.
| ||||||
15 | A partnership shall file such returns and other
information at | ||||||
16 | such
time and in such manner as may be required under Article 5 | ||||||
17 | of this Act.
The partners in a partnership shall be liable for | ||||||
18 | the replacement tax imposed
by subsection 201 (c) and (d) of | ||||||
19 | this Act on such partnership, to the extent
such tax is not | ||||||
20 | paid by the partnership, as provided under the laws of Illinois
| ||||||
21 | governing the liability of partners for the obligations of a | ||||||
22 | partnership.
Persons carrying on business as partners shall be | ||||||
23 | liable for the tax
imposed by subsection 201 (a) and (b) of | ||||||
24 | this Act only in their separate
or individual capacities. | ||||||
25 | (c) Subchapter S corporations. A Subchapter S corporation | ||||||
26 | shall not
be subject to the tax imposed by subsection 201 (a) |
| |||||||
| |||||||
1 | and
(b) of this Act but shall be subject to the replacement tax | ||||||
2 | imposed by subsection
201 (c) and (d) of this Act and shall | ||||||
3 | file such returns
and other information
at such time and in | ||||||
4 | such manner as may be required under Article 5 of this Act. | ||||||
5 | (d) Combat zone death. An individual relieved from the | ||||||
6 | federal
income tax for any taxable year by reason of section | ||||||
7 | 692 of the Internal
Revenue Code shall not be subject to the | ||||||
8 | tax imposed by this Act for
such taxable year. | ||||||
9 | (e) Certain trusts. A common trust fund described in | ||||||
10 | Section 584
of the Internal Revenue Code, and any other trust | ||||||
11 | to the extent that the
grantor is treated as the owner thereof | ||||||
12 | under sections 671 through 678
of the Internal Revenue Code | ||||||
13 | shall not be subject to the tax imposed by
this Act. | ||||||
14 | (f) Certain business activities. A person not otherwise | ||||||
15 | subject to the tax
imposed by this Act shall not become subject | ||||||
16 | to the tax imposed by this Act by
reason of: | ||||||
17 | (1) that person's ownership of tangible personal | ||||||
18 | property located at the
premises of
a printer in this State | ||||||
19 | with which the person has contracted for printing, or | ||||||
20 | (2) activities of the person's employees or agents | ||||||
21 | located solely at the
premises of a printer and related to | ||||||
22 | quality control, distribution, or printing
services | ||||||
23 | performed by a printer in the State with which the person | ||||||
24 | has
contracted for printing. | ||||||
25 | (g) A nonprofit risk organization that holds a certificate | ||||||
26 | of authority under Article VIID of the Illinois Insurance Code |
| |||||||
| |||||||
1 | is exempt from the tax imposed under this Act with respect to | ||||||
2 | its activities or operations in furtherance of the powers | ||||||
3 | conferred upon it under that Article VIID of the Illinois | ||||||
4 | Insurance Code.
| ||||||
5 | (h) For taxable years ending on or after December 31, 2011, | ||||||
6 | any oil company liable for tax under the Oil Company Gross | ||||||
7 | Income Tax Act shall not be subject to the tax imposed by | ||||||
8 | subsections 201 (a) and (b) of this Act, but shall be subject | ||||||
9 | to the replacement tax imposed by subsection 201 (c) and (d) of | ||||||
10 | this Act. For purposes of computing the tax imposed on any | ||||||
11 | person by subsections 201 (a) and (b) of this Act, but not the | ||||||
12 | replacement tax imposed by subsections 201 (c) and (d) of this | ||||||
13 | Act, the base income of a partnership, trust or Subchapter S | ||||||
14 | corporation that is liable for tax under the Oil Company Gross | ||||||
15 | Income Tax Act shall be deemed to be an amount exempt from | ||||||
16 | taxation by this State under subparagraphs (a)(2)(N), | ||||||
17 | (b)(2)(J), (c)(2)(K) and (d)(2)(G) of Section 203 of this Act. | ||||||
18 | This subsection (h) is exempt from the provisions of Section | ||||||
19 | 250 of this Act. | ||||||
20 | (Source: P.A. 95-233, eff. 8-16-07; 95-331, eff. 8-21-07.) | ||||||
21 | (35 ILCS 5/901) (from Ch. 120, par. 9-901) | ||||||
22 | Sec. 901. Collection Authority. | ||||||
23 | (a) In general. | ||||||
24 | The Department shall collect the taxes imposed by this Act. | ||||||
25 | The Department
shall collect certified past due child support |
| |||||||
| |||||||
1 | amounts under Section 2505-650
of the Department of Revenue Law | ||||||
2 | (20 ILCS 2505/2505-650). Except as
provided in subsections (c) | ||||||
3 | and (e) of this Section, money collected
pursuant to | ||||||
4 | subsections (a) and (b) of Section 201 of this Act shall be
| ||||||
5 | paid into the General Revenue Fund in the State treasury; money
| ||||||
6 | collected pursuant to subsections (c) and (d) of Section 201 of | ||||||
7 | this Act
shall be paid into the Personal Property Tax | ||||||
8 | Replacement Fund, a special
fund in the State Treasury; and | ||||||
9 | money collected under Section 2505-650 of the
Department of | ||||||
10 | Revenue Law (20 ILCS 2505/2505-650) shall be paid
into the
| ||||||
11 | Child Support Enforcement Trust Fund, a special fund outside | ||||||
12 | the State
Treasury, or
to the State
Disbursement Unit | ||||||
13 | established under Section 10-26 of the Illinois Public Aid
| ||||||
14 | Code, as directed by the Department of Healthcare and Family | ||||||
15 | Services. | ||||||
16 | (b) Local Government Distributive Fund. | ||||||
17 | Beginning August 1, 1969, and continuing through June 30, | ||||||
18 | 1994, the Treasurer
shall transfer each month from the General | ||||||
19 | Revenue Fund to a special fund in
the State treasury, to be | ||||||
20 | known as the "Local Government Distributive Fund", an
amount | ||||||
21 | equal to 1/12 of the net revenue realized from the tax imposed | ||||||
22 | by
subsections (a) and (b) of Section 201 of this Act during | ||||||
23 | the preceding month.
Beginning July 1, 1994, and continuing | ||||||
24 | through June 30, 1995, the Treasurer
shall transfer each month | ||||||
25 | from the General Revenue Fund to the Local Government
| ||||||
26 | Distributive Fund an amount equal to 1/11 of the net revenue |
| |||||||
| |||||||
1 | realized from the
tax imposed by subsections (a) and (b) of | ||||||
2 | Section 201 of this Act during the
preceding month. Beginning | ||||||
3 | July 1, 1995, the Treasurer shall transfer each
month from the | ||||||
4 | General Revenue Fund to the Local Government Distributive Fund
| ||||||
5 | an amount equal to the net of (i) 1/10 of the net revenue | ||||||
6 | realized from the
tax imposed by
subsections (a) and (b) of | ||||||
7 | Section 201 of the Illinois Income Tax Act during
the preceding | ||||||
8 | month
(ii) minus, beginning July 1, 2003 and ending June 30, | ||||||
9 | 2004, $6,666,666, and
beginning July 1,
2004,
zero. Net revenue | ||||||
10 | realized for a month shall be defined as the
revenue from the | ||||||
11 | tax imposed by subsections (a) and (b) of Section 201 of this
| ||||||
12 | Act which is deposited in the General Revenue Fund, the | ||||||
13 | Educational Assistance
Fund and the Income Tax Surcharge Local | ||||||
14 | Government Distributive Fund during the
month minus the amount | ||||||
15 | paid out of the General Revenue Fund in State warrants
during | ||||||
16 | that same month as refunds to taxpayers for overpayment of | ||||||
17 | liability
under the tax imposed by subsections (a) and (b) of | ||||||
18 | Section 201 of this Act. | ||||||
19 | (c) Deposits Into Income Tax Refund Fund. | ||||||
20 | (1) Beginning on January 1, 1989 and thereafter, the | ||||||
21 | Department shall
deposit a percentage of the amounts | ||||||
22 | collected pursuant to subsections (a)
and (b)(1), (2), and | ||||||
23 | (3), of Section 201 of this Act into a fund in the State
| ||||||
24 | treasury known as the Income Tax Refund Fund. The | ||||||
25 | Department shall deposit 6%
of such amounts during the | ||||||
26 | period beginning January 1, 1989 and ending on June
30, |
| |||||||
| |||||||
1 | 1989. Beginning with State fiscal year 1990 and for each | ||||||
2 | fiscal year
thereafter, the percentage deposited into the | ||||||
3 | Income Tax Refund Fund during a
fiscal year shall be the | ||||||
4 | Annual Percentage. For fiscal years 1999 through
2001, the | ||||||
5 | Annual Percentage shall be 7.1%.
For fiscal year 2003, the | ||||||
6 | Annual Percentage shall be 8%.
For fiscal year 2004, the | ||||||
7 | Annual Percentage shall be 11.7%. Upon the effective date | ||||||
8 | of this amendatory Act of the 93rd General Assembly, the | ||||||
9 | Annual Percentage shall be 10% for fiscal year 2005. For | ||||||
10 | fiscal year 2006, the Annual Percentage shall be 9.75%. For | ||||||
11 | fiscal
year 2007, the Annual Percentage shall be 9.75%. For | ||||||
12 | fiscal year 2008, the Annual Percentage shall be 7.75%. For | ||||||
13 | fiscal year 2009, the Annual Percentage shall be 9.75%. For | ||||||
14 | fiscal year 2010, the Annual Percentage shall be 9.75%. For | ||||||
15 | all other
fiscal years, the
Annual Percentage shall be | ||||||
16 | calculated as a fraction, the numerator of which
shall be | ||||||
17 | the amount of refunds approved for payment by the | ||||||
18 | Department during
the preceding fiscal year as a result of | ||||||
19 | overpayment of tax liability under
subsections (a) and | ||||||
20 | (b)(1), (2), and (3) of Section 201 of this Act plus the
| ||||||
21 | amount of such refunds remaining approved but unpaid at the | ||||||
22 | end of the
preceding fiscal year, minus the amounts | ||||||
23 | transferred into the Income Tax
Refund Fund from the | ||||||
24 | Tobacco Settlement Recovery Fund, and
the denominator of | ||||||
25 | which shall be the amounts which will be collected pursuant
| ||||||
26 | to subsections (a) and (b)(1), (2), and (3) of Section 201 |
| |||||||
| |||||||
1 | of this Act during
the preceding fiscal year; except that | ||||||
2 | in State fiscal year 2002, the Annual
Percentage shall in | ||||||
3 | no event exceed 7.6%. The Director of Revenue shall
certify | ||||||
4 | the Annual Percentage to the Comptroller on the last | ||||||
5 | business day of
the fiscal year immediately preceding the | ||||||
6 | fiscal year for which it is to be
effective. | ||||||
7 | (2) Beginning on January 1, 1989 and thereafter, the | ||||||
8 | Department shall
deposit a percentage of the amounts | ||||||
9 | collected pursuant to subsections (a)
and (b)(6), (7), and | ||||||
10 | (8), (c) and (d) of Section 201
of this Act into a fund in | ||||||
11 | the State treasury known as the Income Tax
Refund Fund. The | ||||||
12 | Department shall deposit 18% of such amounts during the
| ||||||
13 | period beginning January 1, 1989 and ending on June 30, | ||||||
14 | 1989. Beginning
with State fiscal year 1990 and for each | ||||||
15 | fiscal year thereafter, the
percentage deposited into the | ||||||
16 | Income Tax Refund Fund during a fiscal year
shall be the | ||||||
17 | Annual Percentage. For fiscal years 1999, 2000, and 2001, | ||||||
18 | the
Annual Percentage shall be 19%.
For fiscal year 2003, | ||||||
19 | the Annual Percentage shall be 27%. For fiscal year
2004, | ||||||
20 | the Annual Percentage shall be 32%.
Upon the effective date | ||||||
21 | of this amendatory Act of the 93rd General Assembly, the | ||||||
22 | Annual Percentage shall be 24% for fiscal year 2005.
For | ||||||
23 | fiscal year 2006, the Annual Percentage shall be 20%. For | ||||||
24 | fiscal
year 2007, the Annual Percentage shall be 17.5%. For | ||||||
25 | fiscal year 2008, the Annual Percentage shall be 15.5%. For | ||||||
26 | fiscal year 2009, the Annual Percentage shall be 17.5%. For |
| |||||||
| |||||||
1 | fiscal year 2010, the Annual Percentage shall be 17.5%. For | ||||||
2 | all other fiscal years, the Annual
Percentage shall be | ||||||
3 | calculated
as a fraction, the numerator of which shall be | ||||||
4 | the amount of refunds
approved for payment by the | ||||||
5 | Department during the preceding fiscal year as
a result of | ||||||
6 | overpayment of tax liability under subsections (a) and | ||||||
7 | (b)(6),
(7), and (8), (c) and (d) of Section 201 of this | ||||||
8 | Act plus the
amount of such refunds remaining approved but | ||||||
9 | unpaid at the end of the
preceding fiscal year, and the | ||||||
10 | denominator of
which shall be the amounts which will be | ||||||
11 | collected pursuant to subsections (a)
and (b)(6), (7), and | ||||||
12 | (8), (c) and (d) of Section 201 of this Act during the
| ||||||
13 | preceding fiscal year; except that in State fiscal year | ||||||
14 | 2002, the Annual
Percentage shall in no event exceed 23%. | ||||||
15 | The Director of Revenue shall
certify the Annual Percentage | ||||||
16 | to the Comptroller on the last business day of
the fiscal | ||||||
17 | year immediately preceding the fiscal year for which it is | ||||||
18 | to be
effective. | ||||||
19 | (3) The Comptroller shall order transferred and the | ||||||
20 | Treasurer shall
transfer from the Tobacco Settlement | ||||||
21 | Recovery Fund to the Income Tax Refund
Fund (i) $35,000,000 | ||||||
22 | in January, 2001, (ii) $35,000,000 in January, 2002, and
| ||||||
23 | (iii) $35,000,000 in January, 2003. | ||||||
24 | (4) As soon as possible after the end of each fiscal | ||||||
25 | year, the Director shall order transferred and the State | ||||||
26 | Treasurer and State Comptroller shall transfer from the |
| |||||||
| |||||||
1 | General Revenue Fund to the Income Tax Refund Fund an | ||||||
2 | amount, certified by the Director to the Comptroller, equal | ||||||
3 | to refunds paid during the fiscal year under the Oil | ||||||
4 | Company Gross Income Tax Act. | ||||||
5 | (d) Expenditures from Income Tax Refund Fund. | ||||||
6 | (1) Beginning January 1, 1989, money in the Income Tax | ||||||
7 | Refund Fund
shall be expended exclusively for the purpose | ||||||
8 | of paying refunds resulting
from overpayment of tax | ||||||
9 | liability under Section 201 of this Act or under the Oil | ||||||
10 | Company Gross Income Tax Act , for paying
rebates under | ||||||
11 | Section 208.1 in the event that the amounts in the | ||||||
12 | Homeowners'
Tax Relief Fund are insufficient for that | ||||||
13 | purpose,
and for
making transfers pursuant to this | ||||||
14 | subsection (d). | ||||||
15 | (2) The Director shall order payment of refunds | ||||||
16 | resulting from
overpayment of tax liability under Section | ||||||
17 | 201 of this Act or under the Oil Company Gross Income Tax | ||||||
18 | Act from the
Income Tax Refund Fund only to the extent that | ||||||
19 | amounts collected pursuant
to Section 201 of this Act and | ||||||
20 | transfers pursuant to this subsection (d)
and item (3) of | ||||||
21 | subsection (c) have been deposited and retained in the
| ||||||
22 | Fund. | ||||||
23 | (3) As soon as possible after the end of each fiscal | ||||||
24 | year, the Director
shall
order transferred and the State | ||||||
25 | Treasurer and State Comptroller shall
transfer from the | ||||||
26 | Income Tax Refund Fund to the Personal Property Tax
|
| |||||||
| |||||||
1 | Replacement Fund an amount, certified by the Director to | ||||||
2 | the Comptroller,
equal to the excess of the amount | ||||||
3 | collected pursuant to subsections (c) and
(d) of Section | ||||||
4 | 201 of this Act deposited into the Income Tax Refund Fund
| ||||||
5 | during the fiscal year over the amount of refunds resulting | ||||||
6 | from
overpayment of tax liability under subsections (c) and | ||||||
7 | (d) of Section 201
of this Act paid from the Income Tax | ||||||
8 | Refund Fund during the fiscal year. | ||||||
9 | (4) As soon as possible after the end of each fiscal | ||||||
10 | year, the Director shall
order transferred and the State | ||||||
11 | Treasurer and State Comptroller shall
transfer from the | ||||||
12 | Personal Property Tax Replacement Fund to the Income Tax
| ||||||
13 | Refund Fund an amount, certified by the Director to the | ||||||
14 | Comptroller, equal
to the excess of the amount of refunds | ||||||
15 | resulting from overpayment of tax
liability under | ||||||
16 | subsections (c) and (d) of Section 201 of this Act paid
| ||||||
17 | from the Income Tax Refund Fund during the fiscal year over | ||||||
18 | the amount
collected pursuant to subsections (c) and (d) of | ||||||
19 | Section 201 of this Act
deposited into the Income Tax | ||||||
20 | Refund Fund during the fiscal year. | ||||||
21 | (4.5) As soon as possible after the end of fiscal year | ||||||
22 | 1999 and of each
fiscal year
thereafter, the Director shall | ||||||
23 | order transferred and the State Treasurer and
State | ||||||
24 | Comptroller shall transfer from the Income Tax Refund Fund | ||||||
25 | to the General
Revenue Fund any surplus remaining in the | ||||||
26 | Income Tax Refund Fund as of the end
of such fiscal year; |
| |||||||
| |||||||
1 | excluding for fiscal years 2000, 2001, and 2002
amounts | ||||||
2 | attributable to transfers under item (3) of subsection (c) | ||||||
3 | less refunds
resulting from the earned income tax credit. | ||||||
4 | (5) This Act shall constitute an irrevocable and | ||||||
5 | continuing
appropriation from the Income Tax Refund Fund | ||||||
6 | for the purpose of paying
refunds upon the order of the | ||||||
7 | Director in accordance with the provisions of
this Section. | ||||||
8 | (e) Deposits into the Education Assistance Fund and the | ||||||
9 | Income Tax
Surcharge Local Government Distributive Fund. | ||||||
10 | On July 1, 1991, and thereafter, of the amounts collected | ||||||
11 | pursuant to
subsections (a) and (b) of Section 201 of this Act, | ||||||
12 | minus deposits into the
Income Tax Refund Fund, the Department | ||||||
13 | shall deposit 7.3% into the
Education Assistance Fund in the | ||||||
14 | State Treasury. Beginning July 1, 1991,
and continuing through | ||||||
15 | January 31, 1993, of the amounts collected pursuant to
| ||||||
16 | subsections (a) and (b) of Section 201 of the Illinois Income | ||||||
17 | Tax Act, minus
deposits into the Income Tax Refund Fund, the | ||||||
18 | Department shall deposit 3.0%
into the Income Tax Surcharge | ||||||
19 | Local Government Distributive Fund in the State
Treasury. | ||||||
20 | Beginning February 1, 1993 and continuing through June 30, | ||||||
21 | 1993, of
the amounts collected pursuant to subsections (a) and | ||||||
22 | (b) of Section 201 of the
Illinois Income Tax Act, minus | ||||||
23 | deposits into the Income Tax Refund Fund, the
Department shall | ||||||
24 | deposit 4.4% into the Income Tax Surcharge Local Government
| ||||||
25 | Distributive Fund in the State Treasury. Beginning July 1, | ||||||
26 | 1993, and
continuing through June 30, 1994, of the amounts |
| |||||||
| |||||||
1 | collected under subsections
(a) and (b) of Section 201 of this | ||||||
2 | Act, minus deposits into the Income Tax
Refund Fund, the | ||||||
3 | Department shall deposit 1.475% into the Income Tax Surcharge
| ||||||
4 | Local Government Distributive Fund in the State Treasury. | ||||||
5 | (Source: P.A. 95-707, eff. 1-11-08; 95-744, eff. 7-18-08; | ||||||
6 | 96-45, eff. 7-15-09; 96-328, eff. 8-11-09.) | ||||||
7 | (35 ILCS 5/1501) (from Ch. 120, par. 15-1501) | ||||||
8 | Sec. 1501. Definitions. | ||||||
9 | (a) In general. When used in this Act, where not
otherwise | ||||||
10 | distinctly expressed or manifestly incompatible with the | ||||||
11 | intent
thereof: | ||||||
12 | (1) Business income. The term "business income" means | ||||||
13 | all income that may be treated as apportionable business | ||||||
14 | income under the Constitution of the United States. | ||||||
15 | Business income is net of the deductions allocable thereto. | ||||||
16 | Such term does not include compensation
or the deductions | ||||||
17 | allocable thereto.
For each taxable year beginning on or | ||||||
18 | after January 1, 2003, a taxpayer may
elect to treat all | ||||||
19 | income other than compensation as business income. This
| ||||||
20 | election shall be made in accordance with rules adopted by | ||||||
21 | the Department and,
once made, shall be irrevocable. | ||||||
22 | (1.5) Captive real estate investment trust:
| ||||||
23 | (A) The term "captive real estate investment | ||||||
24 | trust" means a corporation, trust, or association:
| ||||||
25 | (i) that is considered a real estate |
| |||||||
| |||||||
1 | investment trust for the taxable year under | ||||||
2 | Section 856 of the Internal Revenue Code;
| ||||||
3 | (ii) the certificates of beneficial interest | ||||||
4 | or shares of which are not regularly traded on an | ||||||
5 | established securities market; and | ||||||
6 | (iii) of which more than 50% of the voting | ||||||
7 | power or value of the beneficial interest or | ||||||
8 | shares, at any time during the last half of the | ||||||
9 | taxable year, is owned or controlled, directly, | ||||||
10 | indirectly, or constructively, by a single | ||||||
11 | corporation. | ||||||
12 | (B) The term "captive real estate investment | ||||||
13 | trust" does not include: | ||||||
14 | (i) a real estate investment trust of which | ||||||
15 | more than 50% of the voting power or value of the | ||||||
16 | beneficial interest or shares is owned or | ||||||
17 | controlled, directly, indirectly, or | ||||||
18 | constructively, by: | ||||||
19 | (a) a real estate investment trust, other | ||||||
20 | than a captive real estate investment trust; | ||||||
21 | (b) a person who is exempt from taxation | ||||||
22 | under Section 501 of the Internal Revenue Code, | ||||||
23 | and who is not required to treat income | ||||||
24 | received from the real estate investment trust | ||||||
25 | as unrelated business taxable income under | ||||||
26 | Section 512 of the Internal Revenue Code; |
| |||||||
| |||||||
1 | (c) a listed Australian property trust, if | ||||||
2 | no more than 50% of the voting power or value | ||||||
3 | of the beneficial interest or shares of that | ||||||
4 | trust, at any time during the last half of the | ||||||
5 | taxable year, is owned or controlled, directly | ||||||
6 | or indirectly, by a single person; | ||||||
7 | (d) an entity organized as a trust, | ||||||
8 | provided a listed Australian property trust | ||||||
9 | described in subparagraph (c) owns or | ||||||
10 | controls, directly or indirectly, or | ||||||
11 | constructively, 75% or more of the voting power | ||||||
12 | or value of the beneficial interests or shares | ||||||
13 | of such entity; or | ||||||
14 | (e) an entity that is organized outside of | ||||||
15 | the laws of the United States and that | ||||||
16 | satisfies all of the following criteria: | ||||||
17 | (1) at least 75% of the entity's total | ||||||
18 | asset value at the close of its taxable | ||||||
19 | year is represented by real estate assets | ||||||
20 | (as defined in Section 856(c)(5)(B) of the | ||||||
21 | Internal Revenue Code, thereby including | ||||||
22 | shares or certificates of beneficial | ||||||
23 | interest in any real estate investment | ||||||
24 | trust), cash and cash equivalents, and | ||||||
25 | U.S. Government securities; | ||||||
26 | (2) the entity is not subject to tax on |
| |||||||
| |||||||
1 | amounts that are distributed to its | ||||||
2 | beneficial owners or is exempt from | ||||||
3 | entity-level taxation; | ||||||
4 | (3) the entity distributes at least | ||||||
5 | 85% of its taxable income (as computed in | ||||||
6 | the jurisdiction in which it is organized) | ||||||
7 | to the holders of its shares or | ||||||
8 | certificates of beneficial interest on an | ||||||
9 | annual basis; | ||||||
10 | (4) either (i) the shares or | ||||||
11 | beneficial interests of the entity are | ||||||
12 | regularly traded on an established | ||||||
13 | securities market or (ii) not more than 10% | ||||||
14 | of the voting power or value in the entity | ||||||
15 | is held, directly, indirectly, or | ||||||
16 | constructively, by a single entity or | ||||||
17 | individual; and | ||||||
18 | (5) the entity is organized in a | ||||||
19 | country that has entered into a tax treaty | ||||||
20 | with the United States; or | ||||||
21 | (ii) during its first taxable year for which it | ||||||
22 | elects to be treated as a real estate investment | ||||||
23 | trust under Section 856(c)(1) of the Internal | ||||||
24 | Revenue Code, a real estate investment trust the | ||||||
25 | certificates of beneficial interest or shares of | ||||||
26 | which are not regularly traded on an established |
| |||||||
| |||||||
1 | securities market, but only if the certificates of | ||||||
2 | beneficial interest or shares of the real estate | ||||||
3 | investment trust are regularly traded on an | ||||||
4 | established securities market prior to the earlier | ||||||
5 | of the due date (including extensions) for filing | ||||||
6 | its return under this Act for that first taxable | ||||||
7 | year or the date it actually files that return. | ||||||
8 | (C) For the purposes of this subsection (1.5), the | ||||||
9 | constructive ownership rules prescribed under Section | ||||||
10 | 318(a) of the Internal Revenue Code, as modified by | ||||||
11 | Section 856(d)(5) of the Internal Revenue Code, apply | ||||||
12 | in determining the ownership of stock, assets, or net | ||||||
13 | profits of any person.
| ||||||
14 | (2) Commercial domicile. The term "commercial | ||||||
15 | domicile" means the
principal
place from which the trade or | ||||||
16 | business of the taxpayer is directed or managed. | ||||||
17 | (3) Compensation. The term "compensation" means wages, | ||||||
18 | salaries,
commissions
and any other form of remuneration | ||||||
19 | paid to employees for personal services. | ||||||
20 | (4) Corporation. The term "corporation" includes | ||||||
21 | associations, joint-stock
companies, insurance companies | ||||||
22 | and cooperatives. Any entity, including a
limited | ||||||
23 | liability company formed under the Illinois Limited | ||||||
24 | Liability Company
Act, shall be treated as a corporation if | ||||||
25 | it is so classified for federal
income tax purposes.
| ||||||
26 | (5) Department. The term "Department" means the |
| |||||||
| |||||||
1 | Department of Revenue of
this State. | ||||||
2 | (6) Director. The term "Director" means the Director of | ||||||
3 | Revenue of this
State. | ||||||
4 | (7) Fiduciary. The term "fiduciary" means a guardian, | ||||||
5 | trustee, executor,
administrator, receiver, or any person | ||||||
6 | acting in any fiduciary capacity for any
person. | ||||||
7 | (8) Financial organization. | ||||||
8 | (A) The term "financial organization" means
any
| ||||||
9 | bank, bank holding company, trust company, savings | ||||||
10 | bank, industrial bank,
land bank, safe deposit | ||||||
11 | company, private banker, savings and loan association,
| ||||||
12 | building and loan association, credit union, currency | ||||||
13 | exchange, cooperative
bank, small loan company, sales | ||||||
14 | finance company, investment company, or any
person | ||||||
15 | which is owned by a bank or bank holding company. For | ||||||
16 | the purpose of
this Section a "person" will include | ||||||
17 | only those persons which a bank holding
company may | ||||||
18 | acquire and hold an interest in, directly or | ||||||
19 | indirectly, under the
provisions of the Bank Holding | ||||||
20 | Company Act of 1956 (12 U.S.C. 1841, et seq.),
except | ||||||
21 | where interests in any person must be disposed of | ||||||
22 | within certain
required time limits under the Bank | ||||||
23 | Holding Company Act of 1956. | ||||||
24 | (B) For purposes of subparagraph (A) of this | ||||||
25 | paragraph, the term
"bank" includes (i) any entity that | ||||||
26 | is regulated by the Comptroller of the
Currency under |
| |||||||
| |||||||
1 | the National Bank Act, or by the Federal Reserve Board, | ||||||
2 | or by
the
Federal Deposit Insurance Corporation and | ||||||
3 | (ii) any federally or State chartered
bank
operating as | ||||||
4 | a credit card bank. | ||||||
5 | (C) For purposes of subparagraph (A) of this | ||||||
6 | paragraph, the term
"sales finance company" has the | ||||||
7 | meaning provided in the following item (i) or
(ii): | ||||||
8 | (i) A person primarily engaged in one or more | ||||||
9 | of the following
businesses: the business of | ||||||
10 | purchasing customer receivables, the business
of | ||||||
11 | making loans upon the security of customer | ||||||
12 | receivables, the
business of making loans for the | ||||||
13 | express purpose of funding purchases of
tangible | ||||||
14 | personal property or services by the borrower, or | ||||||
15 | the business of
finance leasing. For purposes of | ||||||
16 | this item (i), "customer receivable"
means: | ||||||
17 | (a) a retail installment contract or | ||||||
18 | retail charge agreement within
the
meaning
of | ||||||
19 | the Sales Finance Agency Act, the Retail | ||||||
20 | Installment Sales Act, or the
Motor Vehicle | ||||||
21 | Retail Installment Sales Act; | ||||||
22 | (b) an installment, charge, credit, or | ||||||
23 | similar contract or agreement
arising from
the | ||||||
24 | sale of tangible personal property or services | ||||||
25 | in a transaction involving
a deferred payment | ||||||
26 | price payable in one or more installments |
| |||||||
| |||||||
1 | subsequent
to the sale; or | ||||||
2 | (c) the outstanding balance of a contract | ||||||
3 | or agreement described in
provisions
(a) or (b) | ||||||
4 | of this item (i). | ||||||
5 | A customer receivable need not provide for | ||||||
6 | payment of interest on
deferred
payments. A sales | ||||||
7 | finance company may purchase a customer receivable | ||||||
8 | from, or
make a loan secured by a customer | ||||||
9 | receivable to, the seller in the original
| ||||||
10 | transaction or to a person who purchased the | ||||||
11 | customer receivable directly or
indirectly from | ||||||
12 | that seller. | ||||||
13 | (ii) A corporation meeting each of the | ||||||
14 | following criteria: | ||||||
15 | (a) the corporation must be a member of an | ||||||
16 | "affiliated group" within
the
meaning of | ||||||
17 | Section 1504(a) of the Internal Revenue Code, | ||||||
18 | determined
without regard to Section 1504(b) | ||||||
19 | of the Internal Revenue Code; | ||||||
20 | (b) more than 50% of the gross income of | ||||||
21 | the corporation for the
taxable
year
must be | ||||||
22 | interest income derived from qualifying loans. | ||||||
23 | A "qualifying
loan" is a loan made to a member | ||||||
24 | of the corporation's affiliated group that
| ||||||
25 | originates customer receivables (within the | ||||||
26 | meaning of item (i)) or to whom
customer |
| |||||||
| |||||||
1 | receivables originated by a member of the | ||||||
2 | affiliated group have been
transferred, to
the | ||||||
3 | extent the average outstanding balance of | ||||||
4 | loans from that corporation
to members of its | ||||||
5 | affiliated group during the taxable year do not | ||||||
6 | exceed
the limitation amount for that | ||||||
7 | corporation. The "limitation amount" for a
| ||||||
8 | corporation is the average outstanding | ||||||
9 | balances during the taxable year of
customer | ||||||
10 | receivables (within the meaning of item (i)) | ||||||
11 | originated by
all members of the affiliated | ||||||
12 | group.
If the average outstanding balances of | ||||||
13 | the
loans made by a corporation to members of | ||||||
14 | its affiliated group exceed the
limitation | ||||||
15 | amount, the interest income of that | ||||||
16 | corporation from qualifying
loans shall be | ||||||
17 | equal to its interest income from loans to | ||||||
18 | members of its
affiliated groups times a | ||||||
19 | fraction equal to the limitation amount | ||||||
20 | divided by
the average outstanding balances of | ||||||
21 | the loans made by that corporation to
members | ||||||
22 | of its affiliated group; | ||||||
23 | (c) the total of all shareholder's equity | ||||||
24 | (including, without
limitation,
paid-in
| ||||||
25 | capital on common and preferred stock and | ||||||
26 | retained earnings) of the
corporation plus the |
| |||||||
| |||||||
1 | total of all of its loans, advances, and other
| ||||||
2 | obligations payable or owed to members of its | ||||||
3 | affiliated group may not
exceed 20% of the | ||||||
4 | total assets of the corporation at any time | ||||||
5 | during the tax
year; and | ||||||
6 | (d) more than 50% of all interest-bearing | ||||||
7 | obligations of the
affiliated group payable to | ||||||
8 | persons outside the group determined in | ||||||
9 | accordance
with generally accepted accounting | ||||||
10 | principles must be obligations of the
| ||||||
11 | corporation. | ||||||
12 | This amendatory Act of the 91st General Assembly is | ||||||
13 | declaratory of
existing
law. | ||||||
14 | (D) Subparagraphs
(B) and (C) of this paragraph are | ||||||
15 | declaratory of
existing law and apply retroactively, | ||||||
16 | for all tax years beginning on or before
December 31, | ||||||
17 | 1996,
to all original returns, to all amended returns | ||||||
18 | filed no later than 30
days after the effective date of | ||||||
19 | this amendatory Act of 1996, and to all
notices issued | ||||||
20 | on or before the effective date of this amendatory Act | ||||||
21 | of 1996
under subsection (a) of Section 903, subsection | ||||||
22 | (a) of Section 904,
subsection (e) of Section 909, or | ||||||
23 | Section 912.
A taxpayer that is a "financial | ||||||
24 | organization" that engages in any transaction
with an | ||||||
25 | affiliate shall be a "financial organization" for all | ||||||
26 | purposes of this
Act. |
| |||||||
| |||||||
1 | (E) For all tax years beginning on or
before | ||||||
2 | December 31, 1996, a taxpayer that falls within the | ||||||
3 | definition
of a
"financial organization" under | ||||||
4 | subparagraphs (B) or (C) of this paragraph, but
who | ||||||
5 | does
not fall within the definition of a "financial | ||||||
6 | organization" under the Proposed
Regulations issued by | ||||||
7 | the Department of Revenue on July 19, 1996, may
| ||||||
8 | irrevocably elect to apply the Proposed Regulations | ||||||
9 | for all of those years as
though the Proposed | ||||||
10 | Regulations had been lawfully promulgated, adopted, | ||||||
11 | and in
effect for all of those years. For purposes of | ||||||
12 | applying subparagraphs (B) or
(C) of
this
paragraph to | ||||||
13 | all of those years, the election allowed by this | ||||||
14 | subparagraph
applies only to the taxpayer making the | ||||||
15 | election and to those members of the
taxpayer's unitary | ||||||
16 | business group who are ordinarily required to | ||||||
17 | apportion
business income under the same subsection of | ||||||
18 | Section 304 of this Act as the
taxpayer making the | ||||||
19 | election. No election allowed by this subparagraph | ||||||
20 | shall
be made under a claim
filed under subsection (d) | ||||||
21 | of Section 909 more than 30 days after the
effective | ||||||
22 | date of this amendatory Act of 1996. | ||||||
23 | (F) Finance Leases. For purposes of this | ||||||
24 | subsection, a finance lease
shall be treated as a loan | ||||||
25 | or other extension of credit, rather than as a
lease,
| ||||||
26 | regardless of how the transaction is characterized for |
| |||||||
| |||||||
1 | any other purpose,
including the purposes of any | ||||||
2 | regulatory agency to which the lessor is subject.
A | ||||||
3 | finance lease is any transaction in the form of a lease | ||||||
4 | in which the lessee
is treated as the owner of the | ||||||
5 | leased asset entitled to any deduction for
| ||||||
6 | depreciation allowed under Section 167 of the Internal | ||||||
7 | Revenue Code. | ||||||
8 | (9) Fiscal year. The term "fiscal year" means an | ||||||
9 | accounting period of
12 months ending on the last day of | ||||||
10 | any month other than December. | ||||||
11 | (9.5) Fixed place of business. The term "fixed place of | ||||||
12 | business" has the same meaning as that term is given in | ||||||
13 | Section 864 of the Internal Revenue Code and the related | ||||||
14 | Treasury regulations. | ||||||
15 | (10) Includes and including. The terms "includes" and | ||||||
16 | "including" when
used in a definition contained in this Act | ||||||
17 | shall not be deemed to exclude
other things otherwise | ||||||
18 | within the meaning of the term defined. | ||||||
19 | (11) Internal Revenue Code. The term "Internal Revenue | ||||||
20 | Code" means the
United States Internal Revenue Code of 1954 | ||||||
21 | or any successor law or laws
relating to federal income | ||||||
22 | taxes in effect for the taxable year. | ||||||
23 | (11.5) Investment partnership. | ||||||
24 | (A) The term "investment partnership" means any | ||||||
25 | entity that is treated as a partnership for federal | ||||||
26 | income tax purposes that meets the following |
| |||||||
| |||||||
1 | requirements: | ||||||
2 | (i) no less than 90% of the partnership's cost | ||||||
3 | of its total assets consists of qualifying | ||||||
4 | investment securities, deposits at banks or other | ||||||
5 | financial institutions, and office space and | ||||||
6 | equipment reasonably necessary to carry on its | ||||||
7 | activities as an investment partnership; | ||||||
8 | (ii) no less than 90% of its gross income | ||||||
9 | consists of interest, dividends, and gains from | ||||||
10 | the sale or exchange of qualifying investment | ||||||
11 | securities; and
| ||||||
12 | (iii) the partnership is not a dealer in | ||||||
13 | qualifying investment securities. | ||||||
14 | (B) For purposes of this paragraph (11.5), the term | ||||||
15 | "qualifying investment securities" includes all of the | ||||||
16 | following:
| ||||||
17 | (i) common stock, including preferred or debt | ||||||
18 | securities convertible into common stock, and | ||||||
19 | preferred stock; | ||||||
20 | (ii) bonds, debentures, and other debt | ||||||
21 | securities; | ||||||
22 | (iii) foreign and domestic currency deposits | ||||||
23 | secured by federal, state, or local governmental | ||||||
24 | agencies; | ||||||
25 | (iv) mortgage or asset-backed securities | ||||||
26 | secured by federal, state, or local governmental |
| |||||||
| |||||||
1 | agencies; | ||||||
2 | (v) repurchase agreements and loan | ||||||
3 | participations; | ||||||
4 | (vi) foreign currency exchange contracts and | ||||||
5 | forward and futures contracts on foreign | ||||||
6 | currencies; | ||||||
7 | (vii) stock and bond index securities and | ||||||
8 | futures contracts and other similar financial | ||||||
9 | securities and futures contracts on those | ||||||
10 | securities;
| ||||||
11 | (viii) options for the purchase or sale of any | ||||||
12 | of the securities, currencies, contracts, or | ||||||
13 | financial instruments described in items (i) to | ||||||
14 | (vii), inclusive;
| ||||||
15 | (ix) regulated futures contracts;
| ||||||
16 | (x) commodities (not described in Section | ||||||
17 | 1221(a)(1) of the Internal Revenue Code) or | ||||||
18 | futures, forwards, and options with respect to | ||||||
19 | such commodities, provided, however, that any item | ||||||
20 | of a physical commodity to which title is actually | ||||||
21 | acquired in the partnership's capacity as a dealer | ||||||
22 | in such commodity shall not be a qualifying | ||||||
23 | investment security;
| ||||||
24 | (xi) derivatives; and
| ||||||
25 | (xii) a partnership interest in another | ||||||
26 | partnership that is an investment partnership.
|
| |||||||
| |||||||
1 | (12) Mathematical error. The term "mathematical error" | ||||||
2 | includes the
following types of errors, omissions, or | ||||||
3 | defects in a return filed by a
taxpayer which prevents | ||||||
4 | acceptance of the return as filed for processing: | ||||||
5 | (A) arithmetic errors or incorrect computations on | ||||||
6 | the return or
supporting schedules; | ||||||
7 | (B) entries on the wrong lines; | ||||||
8 | (C) omission of required supporting forms or | ||||||
9 | schedules or the omission
of the information in whole | ||||||
10 | or in part called for thereon; and | ||||||
11 | (D) an attempt to claim, exclude, deduct, or | ||||||
12 | improperly report, in a
manner
directly contrary to the | ||||||
13 | provisions of the Act and regulations thereunder
any | ||||||
14 | item of income, exemption, deduction, or credit. | ||||||
15 | (13) Nonbusiness income. The term "nonbusiness income" | ||||||
16 | means all income
other than business income or | ||||||
17 | compensation. | ||||||
18 | (14) Nonresident. The term "nonresident" means a | ||||||
19 | person who is not a
resident. | ||||||
20 | (15) Paid, incurred and accrued. The terms "paid", | ||||||
21 | "incurred" and
"accrued"
shall be construed according to | ||||||
22 | the method of accounting upon the basis
of which the | ||||||
23 | person's base income is computed under this Act. | ||||||
24 | (16) Partnership and partner. The term "partnership" | ||||||
25 | includes a syndicate,
group, pool, joint venture or other | ||||||
26 | unincorporated organization, through
or by means of which |
| |||||||
| |||||||
1 | any business, financial operation, or venture is carried
| ||||||
2 | on, and which is not, within the meaning of this Act, a | ||||||
3 | trust or estate
or a corporation; and the term "partner" | ||||||
4 | includes a member in such syndicate,
group, pool, joint | ||||||
5 | venture or organization. | ||||||
6 | The term "partnership" includes any entity, including | ||||||
7 | a limited
liability company formed under the Illinois
| ||||||
8 | Limited Liability Company Act, classified as a partnership | ||||||
9 | for federal income tax purposes. | ||||||
10 | The term "partnership" does not include a syndicate, | ||||||
11 | group, pool,
joint venture, or other unincorporated | ||||||
12 | organization established for the
sole purpose of playing | ||||||
13 | the Illinois State Lottery. | ||||||
14 | (17) Part-year resident. The term "part-year resident" | ||||||
15 | means an individual
who became a resident during the | ||||||
16 | taxable year or ceased to be a resident
during the taxable | ||||||
17 | year. Under Section 1501(a)(20)(A)(i) residence
commences | ||||||
18 | with presence in this State for other than a temporary or | ||||||
19 | transitory
purpose and ceases with absence from this State | ||||||
20 | for other than a temporary or
transitory purpose. Under | ||||||
21 | Section 1501(a)(20)(A)(ii) residence commences
with the | ||||||
22 | establishment of domicile in this State and ceases with the
| ||||||
23 | establishment of domicile in another State. | ||||||
24 | (18) Person. The term "person" shall be construed to | ||||||
25 | mean and include
an individual, a trust, estate, | ||||||
26 | partnership, association, firm, company,
corporation, |
| |||||||
| |||||||
1 | limited liability company, or fiduciary. For purposes of | ||||||
2 | Section
1301 and 1302 of this Act, a "person" means (i) an | ||||||
3 | individual, (ii) a
corporation, (iii) an officer, agent, or | ||||||
4 | employee of a
corporation, (iv) a member, agent or employee | ||||||
5 | of a partnership, or (v)
a member,
manager, employee, | ||||||
6 | officer, director, or agent of a limited liability company
| ||||||
7 | who in such capacity commits an offense specified in | ||||||
8 | Section 1301 and 1302. | ||||||
9 | (18A) Records. The term "records" includes all data | ||||||
10 | maintained by the
taxpayer, whether on paper, microfilm, | ||||||
11 | microfiche, or any type of
machine-sensible data | ||||||
12 | compilation. | ||||||
13 | (19) Regulations. The term "regulations" includes | ||||||
14 | rules promulgated and
forms prescribed by the Department. | ||||||
15 | (20) Resident. The term "resident" means: | ||||||
16 | (A) an individual (i) who is
in this State for | ||||||
17 | other than a temporary or transitory purpose during the
| ||||||
18 | taxable year; or (ii) who is domiciled in this State | ||||||
19 | but is absent from
the State for a temporary or | ||||||
20 | transitory purpose during the taxable year; | ||||||
21 | (B) The estate of a decedent who at his or her | ||||||
22 | death was domiciled in
this
State; | ||||||
23 | (C) A trust created by a will of a decedent who at | ||||||
24 | his death was
domiciled
in this State; and | ||||||
25 | (D) An irrevocable trust, the grantor of which was | ||||||
26 | domiciled in this
State
at the time such trust became |
| |||||||
| |||||||
1 | irrevocable. For purpose of this subparagraph,
a trust | ||||||
2 | shall be considered irrevocable to the extent that the | ||||||
3 | grantor is
not treated as the owner thereof under | ||||||
4 | Sections 671 through 678 of the Internal
Revenue Code. | ||||||
5 | (21) Sales. The term "sales" means all gross receipts | ||||||
6 | of the taxpayer
not allocated under Sections 301, 302 and | ||||||
7 | 303. | ||||||
8 | (22) State. The term "state" when applied to a | ||||||
9 | jurisdiction other than
this State means any state of the | ||||||
10 | United States, the District of Columbia,
the Commonwealth | ||||||
11 | of Puerto Rico, any Territory or Possession of the United
| ||||||
12 | States, and any foreign country, or any political | ||||||
13 | subdivision of any of the
foregoing. For purposes of the | ||||||
14 | foreign tax credit under Section 601, the
term "state" | ||||||
15 | means any state of the United States, the District of | ||||||
16 | Columbia,
the Commonwealth of Puerto Rico, and any | ||||||
17 | territory or possession of the
United States, or any | ||||||
18 | political subdivision of any of the foregoing,
effective | ||||||
19 | for tax years ending on or after December 31, 1989. | ||||||
20 | (23) Taxable year. The term "taxable year" means the | ||||||
21 | calendar year, or
the fiscal year ending during such | ||||||
22 | calendar year, upon the basis of which
the base income is | ||||||
23 | computed under this Act. "Taxable year" means, in the
case | ||||||
24 | of a return made for a fractional part of a year under the | ||||||
25 | provisions
of this Act, the period for which such return is | ||||||
26 | made. |
| |||||||
| |||||||
1 | (24) Taxpayer. The term "taxpayer" means any person | ||||||
2 | subject to the tax
imposed by this Act. | ||||||
3 | (25) International banking facility. The term | ||||||
4 | international banking
facility shall have the same meaning | ||||||
5 | as is set forth in the Illinois Banking
Act or as is set | ||||||
6 | forth in the laws of the United States or regulations of
| ||||||
7 | the Board of Governors of the Federal Reserve System. | ||||||
8 | (26) Income Tax Return Preparer. | ||||||
9 | (A) The term "income tax return preparer"
means any | ||||||
10 | person who prepares for compensation, or who employs | ||||||
11 | one or more
persons to prepare for compensation, any | ||||||
12 | return of tax imposed by this Act
or any claim for | ||||||
13 | refund of tax imposed by this Act. The preparation of a
| ||||||
14 | substantial portion of a return or claim for refund | ||||||
15 | shall be treated as
the preparation of that return or | ||||||
16 | claim for refund. | ||||||
17 | (B) A person is not an income tax return preparer | ||||||
18 | if all he or she does
is | ||||||
19 | (i) furnish typing, reproducing, or other | ||||||
20 | mechanical assistance; | ||||||
21 | (ii) prepare returns or claims for refunds for | ||||||
22 | the employer by whom he
or she is regularly and | ||||||
23 | continuously employed; | ||||||
24 | (iii) prepare as a fiduciary returns or claims | ||||||
25 | for refunds for any
person; or | ||||||
26 | (iv) prepare claims for refunds for a taxpayer |
| |||||||
| |||||||
1 | in response to any
notice
of deficiency issued to | ||||||
2 | that taxpayer or in response to any waiver of
| ||||||
3 | restriction after the commencement of an audit of | ||||||
4 | that taxpayer or of another
taxpayer if a | ||||||
5 | determination in the audit of the other taxpayer | ||||||
6 | directly or
indirectly affects the tax liability | ||||||
7 | of the taxpayer whose claims he or she is
| ||||||
8 | preparing. | ||||||
9 | (27) Unitary business group. The term "unitary | ||||||
10 | business group" means
a group of persons related through | ||||||
11 | common ownership whose business activities
are integrated | ||||||
12 | with, dependent upon and contribute to each other. The | ||||||
13 | group
will not include those members whose business | ||||||
14 | activity outside the United
States is 80% or more of any | ||||||
15 | such member's total business activity; for
purposes of this | ||||||
16 | paragraph and clause (a)(3)(B)(ii) of Section 304,
| ||||||
17 | business
activity within the United States shall be | ||||||
18 | measured by means of the factors
ordinarily applicable | ||||||
19 | under subsections (a), (b), (c), (d), or (h)
of Section
304 | ||||||
20 | except that, in the case of members ordinarily required to | ||||||
21 | apportion
business income by means of the 3 factor formula | ||||||
22 | of property, payroll and sales
specified in subsection (a) | ||||||
23 | of Section 304, including the
formula as weighted in | ||||||
24 | subsection (h) of Section 304, such members shall
not use | ||||||
25 | the sales factor in the computation and the results of the | ||||||
26 | property
and payroll factor computations of subsection (a) |
| |||||||
| |||||||
1 | of Section 304 shall be
divided by 2 (by one if either
the | ||||||
2 | property or payroll factor has a denominator of zero). The | ||||||
3 | computation
required by the preceding sentence shall, in | ||||||
4 | each case, involve the division of
the member's property, | ||||||
5 | payroll, or revenue miles in the United States,
insurance | ||||||
6 | premiums on property or risk in the United States, or | ||||||
7 | financial
organization business income from sources within | ||||||
8 | the United States, as the
case may be, by the respective | ||||||
9 | worldwide figures for such items. Common
ownership in the | ||||||
10 | case of corporations is the direct or indirect control or
| ||||||
11 | ownership of more than 50% of the outstanding voting stock | ||||||
12 | of the persons
carrying on unitary business activity. | ||||||
13 | Unitary business activity can
ordinarily be illustrated | ||||||
14 | where the activities of the members are: (1) in the
same | ||||||
15 | general line (such as manufacturing, wholesaling, | ||||||
16 | retailing of tangible
personal property, insurance, | ||||||
17 | transportation or finance); or (2) are steps in a
| ||||||
18 | vertically structured enterprise or process (such as the | ||||||
19 | steps involved in the
production of natural resources, | ||||||
20 | which might include exploration, mining,
refining, and | ||||||
21 | marketing); and, in either instance, the members are | ||||||
22 | functionally
integrated through the exercise of strong | ||||||
23 | centralized management (where, for
example, authority over | ||||||
24 | such matters as purchasing, financing, tax compliance,
| ||||||
25 | product line, personnel, marketing and capital investment | ||||||
26 | is not left to each
member).
In no event, however, will any
|
| |||||||
| |||||||
1 | unitary business group include members
which are | ||||||
2 | ordinarily required to apportion business income under | ||||||
3 | different
subsections of Section 304 except that for tax | ||||||
4 | years ending on or after
December 31, 1987 this prohibition | ||||||
5 | shall not apply to a unitary business group
composed of one | ||||||
6 | or more taxpayers all of which apportion business income
| ||||||
7 | pursuant to subsection (b) of Section 304, or all of which | ||||||
8 | apportion business
income pursuant to subsection (d) of | ||||||
9 | Section 304, and a holding company of such
single-factor | ||||||
10 | taxpayers (see definition of "financial organization" for | ||||||
11 | rule
regarding holding companies of financial | ||||||
12 | organizations). If a unitary business
group would, but for | ||||||
13 | the preceding sentence, include members that are
| ||||||
14 | ordinarily required to apportion business income under | ||||||
15 | different subsections of
Section 304, then for each | ||||||
16 | subsection of Section 304 for which there are two or
more | ||||||
17 | members, there shall be a separate unitary business group | ||||||
18 | composed of such
members. For purposes of the preceding two | ||||||
19 | sentences, a member is "ordinarily
required to apportion | ||||||
20 | business income" under a particular subsection of Section
| ||||||
21 | 304 if it would be required to use the apportionment method | ||||||
22 | prescribed by such
subsection except for the fact that it | ||||||
23 | derives business income solely from
Illinois. As used in | ||||||
24 | this paragraph, the phrase "United States" means only the | ||||||
25 | 50 states and the District of Columbia, and for taxable | ||||||
26 | years ending on or after December 31, 2011, but does not |
| |||||||
| |||||||
1 | include any territory or possession of the United States | ||||||
2 | and or any area over which the United States has asserted | ||||||
3 | jurisdiction or claimed exclusive rights with respect to | ||||||
4 | the exploration for or exploitation of natural resources.
| ||||||
5 | If the unitary business group members' accounting | ||||||
6 | periods differ,
the common parent's accounting period or, | ||||||
7 | if there is no common parent, the
accounting period of the | ||||||
8 | member that is expected to have, on a recurring basis,
the | ||||||
9 | greatest Illinois income tax liability must be used to | ||||||
10 | determine whether to
use the apportionment method provided | ||||||
11 | in subsection (a) or subsection (h) of
Section 304. The
| ||||||
12 | prohibition against membership in a unitary business group | ||||||
13 | for taxpayers
ordinarily required to apportion income | ||||||
14 | under different subsections of Section
304 does not apply | ||||||
15 | to taxpayers required to apportion income under subsection
| ||||||
16 | (a) and subsection (h) of Section
304. The provisions of | ||||||
17 | this amendatory Act of 1998 apply to tax
years ending on or | ||||||
18 | after December 31, 1998. | ||||||
19 | (28) Subchapter S corporation. The term "Subchapter S | ||||||
20 | corporation"
means a corporation for which there is in | ||||||
21 | effect an election under Section
1362 of the Internal | ||||||
22 | Revenue Code, or for which there is a federal election
to | ||||||
23 | opt out of the provisions of the Subchapter S Revision Act | ||||||
24 | of 1982 and
have applied instead the prior federal | ||||||
25 | Subchapter S rules as in effect on July
1, 1982. | ||||||
26 | (30) Foreign person. The term "foreign person" means |
| |||||||
| |||||||
1 | any person who is a nonresident alien individual and any | ||||||
2 | nonindividual entity, regardless of where created or | ||||||
3 | organized, whose business activity outside the United | ||||||
4 | States is 80% or more of the entity's total business | ||||||
5 | activity.
| ||||||
6 | (b) Other definitions. | ||||||
7 | (1) Words denoting number, gender, and so forth,
when | ||||||
8 | used in this Act, where not otherwise distinctly expressed | ||||||
9 | or manifestly
incompatible with the intent thereof: | ||||||
10 | (A) Words importing the singular include and apply | ||||||
11 | to several persons,
parties or things; | ||||||
12 | (B) Words importing the plural include the | ||||||
13 | singular; and | ||||||
14 | (C) Words importing the masculine gender include | ||||||
15 | the feminine as well. | ||||||
16 | (2) "Company" or "association" as including successors | ||||||
17 | and assigns. The
word "company" or "association", when used | ||||||
18 | in reference to a corporation,
shall be deemed to embrace | ||||||
19 | the words "successors and assigns of such company
or | ||||||
20 | association", and in like manner as if these last-named | ||||||
21 | words, or words
of similar import, were expressed. | ||||||
22 | (3) Other terms. Any term used in any Section of this | ||||||
23 | Act with respect
to the application of, or in connection | ||||||
24 | with, the provisions of any other
Section of this Act shall | ||||||
25 | have the same meaning as in such other Section. |
| |||||||
| |||||||
1 | (Source: P.A. 95-233, eff. 8-16-07; 95-707, eff. 1-11-08; | ||||||
2 | 96-641, eff. 8-24-09.)
| ||||||
3 | Section 99. Effective date. This Act takes effect upon | ||||||
4 | becoming law.".
|