HB3824 99TH GENERAL ASSEMBLY

LRB099 11131 HLH 31597 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB3824

Introduced , by Rep. John E. Bradley

SYNOPSIS AS INTRODUCED:

New Act
35 ILCS 5/208	from Ch. 120, par. 2-208
30 ILCS 105/5.866 new
30 ILCS 105/6z-101 new

Creates the Property Tax Refund Act. Provides that the Department shall issue a property tax refund of $500 each year for each parcel of qualified property for which an eligible homeowner paid property taxes. Contains provisions concerning applications. Provides that the Department may request certain information from each county assessor or supervisor of assessments. Provides that, if a county fails to submit the required information, the Department shall not certify to the State Comptroller the amount of the Local Government Distributive Fund allocated to that county until that information is submitted. Provides for implementation without reimbursement by the State. Amends the Illinois Income Tax Act to provide that the tax credit for residential real property taxes applies only for taxable years ending prior to December 31, 2015. Effective immediately.

FISCAL NOTE ACT MAY APPLY

HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. Short title. This Act may be cited as the Property Tax Refund Act.

Section 5. Definitions. As used in this Act:

"Department" means the Department of Revenue.

"Eligible homeowner" means an individual who was liable for property taxes that were paid on qualified property that is located in Illinois and is used as his or her principal place of residence and in which he or she had an ownership interest as of January 1 of the year in which the property taxes were paid.

"Qualified property" means property for which the homeowner would have been allowed a credit under Section 208 of the Illinois Income Tax Act, as that Section existed on January 1, 2015.

Section 10. Property tax refunds.

(a) Beginning in 2015, the Department shall issue a property tax refund each year for each qualified property for which an eligible homeowner who was liable for property taxes that were paid with respect to qualified property in the immediately preceding calendar year has filed a timely application for the property tax refund. The Department shall certify both (i) the names of the eligible homeowners who will receive the refund and (ii) the refund amounts for each eligible homeowner to the Comptroller as soon as possible after July 1 of each year.

(b) The refund shall equal $500 for each qualified property. In the case of a married couple, only one $500 refund shall be allowed and shall be paid to the spouses jointly if requested on the application. If there is more than one eligible homeowner for a qualified property, or if a married couple applies for separate refunds, the refund for that qualified property or for those spouses shall be divided among the applicants as agreed to by the applicants. In the absence of an agreement, the refund shall be divided equally among the applicants who have filed a timely application for the refund. If the Department issues a refund in response to an otherwise valid application that does not list all eligible homeowners entitled to share in the refund or that does not accurately reflect any agreement among the eligible homeowners, it shall not issue any additional refund with respect to that property, and an eligible homeowner who did not receive the share of the refund to which he or she is entitled under this Act shall have recourse only against the eligible homeowners who received the refund.

(c) Application for the refund shall be made in the form and manner prescribed by the Department and shall contain all information reasonably required by the Department for purposes of administering the refund. For refunds for property taxes paid in 2014, an Illinois income tax return claiming a credit under Section 208 of the Illinois Income Tax Act for a tax year ending in 2014 shall be treated as an application for the refund. For refunds for property taxes paid in 2015 or in any subsequent year, the Department may allow or require the application to be made on an Illinois income tax return for the applicant's taxable year ending during the year in which the property taxes were paid, or it may require a separate application, or both. The Department may require applications to be filed electronically, except in the case of an individual who has no ready access to a means of electronic filing or in the case where the application is made on an income tax return that is not required to be filed electronically. No refund shall be allowed to an eligible homeowner for a year unless an application has been filed with the Department no later than June 30 of the second calendar year following the year in which the property taxes were paid, and, in the case of timely-filed application that is incomplete or otherwise defective, any defect has been corrected no later than 30 days after the Department has issued a notice that the application is incomplete or defective or June 30 of that second following year, whichever is later.

(d) In lieu of a refund paid under subsection (a) of Section 10 of this Act, the Department may credit the amount of the refund against (i) any final tax liability of the applicant arising under any Act administered by the Department, regardless of whether other collection remedies are closed to the Department, or (ii) any liability of the applicant against which the Department may offset an overpayment of Illinois income tax of the applicant, and pay only the remaining balance to the applicant.

(e) If a refund is determined by the Department to have been issued in error, as soon as possible after the determination is made, the Department shall issue a demand for repayment of the erroneous refund, plus a penalty of 20% of the erroneous refund, provided that no penalty shall be imposed if the refund was issued as a result of an error of the Department that was not caused by the recipient of the refund or if the recipient had reasonable cause for any error made in applying for the refund. If repayment is not made within 60 days of the date of issuance of the demand, the Department shall enforce repayment of the refund using all legal authority available to the Department of Revenue to collect debt.

Section 15. Information from counties.

(a) Beginning in 2015, the Department may require each county assessor or supervisor of assessments to provide to the Department, upon request, each year the following information relating to the property tax bills issued in the preceding year by parcel number:

(1) county code;

(2) township name or code;

(3) property index number;

(4) name of the owner;

(5) the mailing address of the owner;

(6) the address of the parcel;

(7) all homestead exemptions applicable to the parcel;

(8) property use or type with description;

(9) assessed value (before equalization factor);

(10) equalized assessed value;

(11) tax bill amount; and

(12) such other information as the Department shall require.

(b) The information required by the Department under subsection (a) for property tax bills issued in 2014 shall be submitted no later than 30 days after written request by the Department, and for property tax bills issued in 2015 and subsequent years, shall be submitted no later than May 15 of the following year. The Department may grant requests for extensions of time to submit the information. The information shall be submitted in a computer readable format as directed by the Department. If any county fails to submit the required information by the due date under this subsection, the Department shall not certify to the State Comptroller the amount of the Local Government Distributive Fund allocated to that county under subsection (a) of Section 2 of the State Revenue Sharing Act during any month beginning after that due date until the information is submitted, and then, in the first month beginning after the information is submitted, shall certify to the State Comptroller for payment to that county the amount allocated in that month plus the amounts that were allocated to that county in prior months, but not certified to the State Comptroller as a result of this subsection.

(c) Notwithstanding Sections 6 and 8 of the State Mandates Act, no reimbursement by the State is required for the implementation of any mandate created by this Section.

Section 20. False statements in applications. Any person who files an application for a refund under this Act that contains a materially false statement, or who willfully attempts in any other manner to receive a refund which that person knows he or she is not entitled to receive under this Act, shall be guilty of a Class 4 felony for the first offense and a Class 3 felony for each subsequent offense. A prosecution for any act in violation of this Section may be commenced at any time within 5 years of the commission of that act.

Section 25. Rulemaking. The Department is authorized to make, promulgate and enforce such reasonable rules, and to prescribe such forms, relating to the administration and enforcement of the provisions of this Act, as it may deem appropriate.

The circuit court of the county in which the qualified property is located has the power to review all final administrative decisions of the Department in administering this Act. The provisions of the Administrative Review Law, and all amendments and modifications thereof, and the rules adopted pursuant thereto, shall apply to and govern all proceedings for the judicial review of final administrative decisions of the Department under this Act. The term "administrative decision" is defined as in Section 3-101 of the Code of Civil Procedure.

Section 80. The Illinois Income Tax Act is amended by changing Section 208 as follows:

(35 ILCS 5/208) (from Ch. 120, par. 2-208)

Sec. 208. Tax credit for residential real property taxes. For Beginning with tax years ending on or after December 31, 1991, and prior to December 31, 2015, every individual taxpayer shall be entitled to a tax credit equal to 5% of real property taxes paid by such taxpayer during the taxable year on the principal residence of the taxpayer. In the case of multi-unit or multi-use structures and farm dwellings, the taxes on the taxpayer's principal residence shall be that portion of the total taxes which is attributable to such principal residence.

(Source: P.A. 87-17.)

Section 85. The State Finance Act is amended by adding Sections 5.866 and 6z-101 as follows:

(30 ILCS 105/5.866 new)

Sec. 5.866. The Property Tax Refund Fund.

(30 ILCS 105/6z-101 new)

Sec. 6z-101. The Property Tax Refund Fund; creation. The Property Tax Refund Fund is created as a special fund in the State treasury. Moneys in the Fund shall be used by the Department of Revenue for the purpose of paying refunds under the Property Tax Refund Act.

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