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| | HB5527 Engrossed | | LRB099 16232 HLH 40562 b |
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1 | | AN ACT concerning revenue.
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2 | | Be it enacted by the People of the State of Illinois,
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3 | | represented in the General Assembly:
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4 | | Section 1. Short title. This Act may be cited as the State |
5 | | Tax Preparer Oversight Act. |
6 | | Section 5. Definitions. As used in this Act: |
7 | | "Department" means the Department of Revenue. |
8 | | "Income tax return preparer" has the meaning ascribed to |
9 | | that term in Section
1501 of the Illinois Income Tax Act. |
10 | | "PTIN" means a Preparer Tax Identification Number, as |
11 | | defined in Internal Revenue Service Notice 2011-6. |
12 | | Section 10. Powers and duties of the Department. |
13 | | (a) For taxable years beginning on or after January 1, |
14 | | 2017, the Department shall, by rule, require any income tax |
15 | | return preparer, as defined in Section
1501 of the Illinois |
16 | | Income Tax Act, to include his or her PTIN on any tax return |
17 | | prepared by the income tax return preparer and filed under the |
18 | | Illinois Income Tax Act or any claim for refund of tax imposed |
19 | | by the Illinois Income Tax Act. |
20 | | (b) The Department shall develop and by rule implement a |
21 | | program using the PTIN as an oversight mechanism to assess |
22 | | returns, to identify high error rates, patterns of suspected |
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1 | | fraud, and unsubstantiated basis for tax positions by income |
2 | | tax return preparers. |
3 | | (c) The Department shall, by rule, establish formal and |
4 | | regular communication protocols with the Commissioner of the |
5 | | Internal Revenue Service to share and exchange PTIN information |
6 | | on income tax return preparers who are suspected of fraud, |
7 | | disciplined, or barred from filing tax returns with the |
8 | | Department or the Internal Revenue Service. The Department may, |
9 | | by rule, establish additional communication protocols with |
10 | | other states to exchange similar enforcement or discipline |
11 | | information. |
12 | | Section 15. Enforcement. |
13 | | (a) The Department may investigate the actions of any |
14 | | income tax return preparer doing business in the State and may |
15 | | bar or suspend an income tax return preparer from filing |
16 | | returns with the Department for good cause. |
17 | | (b) In addition to any other penalty provided by law, any |
18 | | individual or person violating this Act by failing to provide |
19 | | his or her PTIN shall pay a civil penalty to the Department in |
20 | | the amount of $50 per offense, but not to exceed $25,000 per |
21 | | calendar year; however, no such penalty shall be imposed if it |
22 | | is shown that the failure is due to reasonable cause and not |
23 | | due to willful neglect, as determined by the Department. |
24 | | (c) The Department shall, before taking any disciplinary |
25 | | action against an income tax return preparer under this |
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1 | | Section, hold a hearing in accordance with this Act. The |
2 | | Department shall,
at least 30 days before the date set for the |
3 | | hearing, (i) notify the accused in writing of the charges made |
4 | | and the time and place for the hearing on the charges, (ii) |
5 | | direct him or her to file a written answer to the charges with |
6 | | the Department under oath within 20 days after the service on |
7 | | him or her of the notice, and (iii) inform the accused that, if |
8 | | he or she fails to answer, disciplinary action shall be taken |
9 | | against him or her, as the Department may consider proper. |
10 | | (d) At the time and place fixed in the notice, the |
11 | | Department shall proceed to hear the charges and the parties or |
12 | | their counsel shall be accorded ample opportunity to present |
13 | | any pertinent statements, testimony, evidence, and arguments. |
14 | | The Department may continue the hearing from time to time.
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15 | | (e) In case the person, after receiving the notice, fails |
16 | | to file an answer, he or she may be subject to the disciplinary |
17 | | action set forth in the notice. The written notice may be |
18 | | served by registered or certified mail to the person's address |
19 | | of record. |
20 | | (f) All final administrative decisions of the Department |
21 | | under this Section shall be subject to judicial review pursuant |
22 | | to the provisions of the Administrative Review Law. The term |
23 | | "administrative decision" is defined as in Section 3-101 of the |
24 | | Code of Civil Procedure. Proceedings for judicial review shall |
25 | | be commenced in the Circuit Court of the county in which the |
26 | | party applying for review resides; provided, that if such party |
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1 | | is not a resident of this State, the venue shall be in Sangamon |
2 | | or Cook County.
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3 | | (g) The Department shall not be required to certify any |
4 | | record to the court or file any answer in court or otherwise |
5 | | appear in any court in a judicial review proceeding, unless and |
6 | | until the Department has received from the plaintiff payment of |
7 | | the costs of furnishing and certifying the record, which costs |
8 | | shall be established by the Department. Exhibits shall be |
9 | | certified without cost. Failure on the part of the plaintiff to |
10 | | file such receipt in court shall be grounds for dismissal of |
11 | | the action. |
12 | | Section 20. Rules. The Department shall adopt rules |
13 | | consistent with the provisions of this Act for the |
14 | | administration and enforcement of this Act. |
15 | | Section 85. The Illinois Income Tax Act is amended by |
16 | | changing Section 503 as follows:
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17 | | (35 ILCS 5/503) (from Ch. 120, par. 5-503)
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18 | | Sec. 503. Signing of Returns and Notices.
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19 | | (a) Signature presumed authentic. The fact that an |
20 | | individual's name
is signed to a return or notice shall be |
21 | | prima facie evidence for all
purposes that such document was |
22 | | actually signed by such individual. If a
return is prepared by |
23 | | an income tax return preparer for a taxpayer, that
preparer |
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1 | | shall sign the return as the preparer of that return and |
2 | | include his or her PTIN, as defined in the State Tax Preparer |
3 | | Oversight Act, on the return .
If a return is transmitted to the |
4 | | Department electronically, the
Department may presume that the |
5 | | electronic return originator has obtained
and is transmitting a |
6 | | valid signature document pursuant to the rules
promulgated by |
7 | | the Department for the electronic filing of tax returns, or
the |
8 | | Department may authorize electronic return originators to |
9 | | maintain the
signature documents and associated documentation, |
10 | | subject to the Department's
right of inspection at any time |
11 | | without notice, rather than transmitting those
documents to the |
12 | | Department, and
the Department may process the return.
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13 | | (b) Corporations. A return or notice required of a |
14 | | corporation shall
be signed by the president, vice-president, |
15 | | treasurer or any other officer
duly authorized so to act or, in |
16 | | the case of a limited liability company, by
a manager or |
17 | | member. In the case of a return or notice made for a
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18 | | corporation by a fiduciary pursuant to the provisions of |
19 | | section 502(b)
(4), such fiduciary shall sign such document. |
20 | | The fact that an
individual's name is signed to a return or |
21 | | notice shall be prima facie
evidence that such individual is |
22 | | authorized to sign such document on behalf
of the corporation.
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23 | | (c) Partnerships. A return or notice of a partnership shall |
24 | | be signed
by any one of the partners or, in the case of a |
25 | | limited liability company, by
a manager or member. The fact |
26 | | that a partner's name is signed to a
return or notice shall be |
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1 | | prima facie evidence that such individual is
authorized to sign |
2 | | such document on behalf of the partnership or limited
liability |
3 | | company.
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4 | | (d) Joint fiduciaries. A return or notice signed by one of |
5 | | two or
more joint fiduciaries will comply with the requirements |
6 | | of this Act. The
fact that a fiduciary's name is signed to such |
7 | | document shall be prima
facie evidence that such fiduciary is |
8 | | authorized to sign such document on
behalf of the person from |
9 | | whom it is required.
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10 | | (e) Failure to sign a return. If a taxpayer fails to sign a |
11 | | return
within 30 days after proper notice and demand for |
12 | | signature by
the
Department, the return shall be considered |
13 | | valid and any amount shown to be
due on the return shall be |
14 | | deemed assessed. Any overpayment of tax shown
on the face of an |
15 | | unsigned return shall be considered forfeited if after
notice |
16 | | and demand for signature by the Department the taxpayer fails |
17 | | to
provide a signature and 3 years have passed from the date |
18 | | the return was
filed. An overpayment of tax refunded to a |
19 | | taxpayer whose return was
filed electronically shall be |
20 | | considered an erroneous refund under Section
912 of this Act |
21 | | if, after proper notice and demand by the
Department, the |
22 | | taxpayer fails to provide a required signature document.
A |
23 | | notice and demand for signature in the case of a return
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24 | | reflecting an overpayment may be made by first class mail. This |
25 | | subsection
(e) shall apply to all returns filed pursuant to the |
26 | | Illinois Income Tax Act
since 1969.
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