99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB3296

 

Introduced 2/19/2016, by Sen. Toi W. Hutchinson

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 5/704A

    Amends the Illinois Income Tax Act. In a Section concerning withholding taxes, provides that the Department may require any withholding tax return and any W-2 Form that is required to be submitted to the Department to be submitted on magnetic media or electronically (currently, the Department may require the form to be submitted on magnetic media or electronically if the form is required to be submitted to the Internal Revenue Service on magnetic media or electronically). Provides that the due date for submitting W-2 Forms shall be as prescribed by the Department by rule. Effective immediately.


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A BILL FOR

 

SB3296LRB099 19738 HLH 44136 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Income Tax Act is amended by
5changing Section 704A as follows:
 
6    (35 ILCS 5/704A)
7    Sec. 704A. Employer's return and payment of tax withheld.
8    (a) In general, every employer who deducts and withholds or
9is required to deduct and withhold tax under this Act on or
10after January 1, 2008 shall make those payments and returns as
11provided in this Section.
12    (b) Returns. Every employer shall, in the form and manner
13required by the Department, make returns with respect to taxes
14withheld or required to be withheld under this Article 7 for
15each quarter beginning on or after January 1, 2008, on or
16before the last day of the first month following the close of
17that quarter.
18    (c) Payments. With respect to amounts withheld or required
19to be withheld on or after January 1, 2008:
20        (1) Semi-weekly payments. For each calendar year, each
21    employer who withheld or was required to withhold more than
22    $12,000 during the one-year period ending on June 30 of the
23    immediately preceding calendar year, payment must be made:

 

 

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1            (A) on or before each Friday of the calendar year,
2        for taxes withheld or required to be withheld on the
3        immediately preceding Saturday, Sunday, Monday, or
4        Tuesday;
5            (B) on or before each Wednesday of the calendar
6        year, for taxes withheld or required to be withheld on
7        the immediately preceding Wednesday, Thursday, or
8        Friday.
9        Beginning with calendar year 2011, payments made under
10    this paragraph (1) of subsection (c) must be made by
11    electronic funds transfer.
12        (2) Semi-weekly payments. Any employer who withholds
13    or is required to withhold more than $12,000 in any quarter
14    of a calendar year is required to make payments on the
15    dates set forth under item (1) of this subsection (c) for
16    each remaining quarter of that calendar year and for the
17    subsequent calendar year.
18        (3) Monthly payments. Each employer, other than an
19    employer described in items (1) or (2) of this subsection,
20    shall pay to the Department, on or before the 15th day of
21    each month the taxes withheld or required to be withheld
22    during the immediately preceding month.
23        (4) Payments with returns. Each employer shall pay to
24    the Department, on or before the due date for each return
25    required to be filed under this Section, any tax withheld
26    or required to be withheld during the period for which the

 

 

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1    return is due and not previously paid to the Department.
2    (d) Regulatory authority. The Department may, by rule:
3        (1) Permit employers, in lieu of the requirements of
4    subsections (b) and (c), to file annual returns due on or
5    before January 31 of the year for taxes withheld or
6    required to be withheld during the previous calendar year
7    and, if the aggregate amounts required to be withheld by
8    the employer under this Article 7 (other than amounts
9    required to be withheld under Section 709.5) do not exceed
10    $1,000 for the previous calendar year, to pay the taxes
11    required to be shown on each such return no later than the
12    due date for such return.
13        (2) Provide that any payment required to be made under
14    subsection (c)(1) or (c)(2) is deemed to be timely to the
15    extent paid by electronic funds transfer on or before the
16    due date for deposit of federal income taxes withheld from,
17    or federal employment taxes due with respect to, the wages
18    from which the Illinois taxes were withheld.
19        (3) Designate one or more depositories to which payment
20    of taxes required to be withheld under this Article 7 must
21    be paid by some or all employers.
22        (4) Increase the threshold dollar amounts at which
23    employers are required to make semi-weekly payments under
24    subsection (c)(1) or (c)(2).
25    (e) Annual return and payment. Every employer who deducts
26and withholds or is required to deduct and withhold tax from a

 

 

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1person engaged in domestic service employment, as that term is
2defined in Section 3510 of the Internal Revenue Code, may
3comply with the requirements of this Section with respect to
4such employees by filing an annual return and paying the taxes
5required to be deducted and withheld on or before the 15th day
6of the fourth month following the close of the employer's
7taxable year. The Department may allow the employer's return to
8be submitted with the employer's individual income tax return
9or to be submitted with a return due from the employer under
10Section 1400.2 of the Unemployment Insurance Act.
11    (f) Magnetic media and electronic filing.
12    With respect to taxes withheld in calendar years prior to
132017, any Any W-2 Form that, under the Internal Revenue Code
14and regulations promulgated thereunder, is required to be
15submitted to the Internal Revenue Service on magnetic media or
16electronically must also be submitted to the Department on
17magnetic media or electronically for Illinois purposes, if
18required by the Department.
19    With respect to taxes withheld in 2017 and subsequent
20calendar years, the Department may, by rule, require that any
21return (including any amended return) under this Section and
22any W-2 Form that is required to be submitted to the Department
23must be submitted on magnetic media or electronically.
24    The due date for submitting W-2 Forms shall be as
25prescribed by the Department by rule.
26    (g) For amounts deducted or withheld after December 31,

 

 

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12009, a taxpayer who makes an election under subsection (f) of
2Section 5-15 of the Economic Development for a Growing Economy
3Tax Credit Act for a taxable year shall be allowed a credit
4against payments due under this Section for amounts withheld
5during the first calendar year beginning after the end of that
6taxable year equal to the amount of the credit for the
7incremental income tax attributable to full-time employees of
8the taxpayer awarded to the taxpayer by the Department of
9Commerce and Economic Opportunity under the Economic
10Development for a Growing Economy Tax Credit Act for the
11taxable year and credits not previously claimed and allowed to
12be carried forward under Section 211(4) of this Act as provided
13in subsection (f) of Section 5-15 of the Economic Development
14for a Growing Economy Tax Credit Act. The credit or credits may
15not reduce the taxpayer's obligation for any payment due under
16this Section to less than zero. If the amount of the credit or
17credits exceeds the total payments due under this Section with
18respect to amounts withheld during the calendar year, the
19excess may be carried forward and applied against the
20taxpayer's liability under this Section in the succeeding
21calendar years as allowed to be carried forward under paragraph
22(4) of Section 211 of this Act. The credit or credits shall be
23applied to the earliest year for which there is a tax
24liability. If there are credits from more than one taxable year
25that are available to offset a liability, the earlier credit
26shall be applied first. Each employer who deducts and withholds

 

 

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1or is required to deduct and withhold tax under this Act and
2who retains income tax withholdings under subsection (f) of
3Section 5-15 of the Economic Development for a Growing Economy
4Tax Credit Act must make a return with respect to such taxes
5and retained amounts in the form and manner that the
6Department, by rule, requires and pay to the Department or to a
7depositary designated by the Department those withheld taxes
8not retained by the taxpayer. For purposes of this subsection
9(g), the term taxpayer shall include taxpayer and members of
10the taxpayer's unitary business group as defined under
11paragraph (27) of subsection (a) of Section 1501 of this Act.
12This Section is exempt from the provisions of Section 250 of
13this Act.
14    (h) An employer may claim a credit against payments due
15under this Section for amounts withheld during the first
16calendar year ending after the date on which a tax credit
17certificate was issued under Section 35 of the Small Business
18Job Creation Tax Credit Act. The credit shall be equal to the
19amount shown on the certificate, but may not reduce the
20taxpayer's obligation for any payment due under this Section to
21less than zero. If the amount of the credit exceeds the total
22payments due under this Section with respect to amounts
23withheld during the calendar year, the excess may be carried
24forward and applied against the taxpayer's liability under this
25Section in the 5 succeeding calendar years. The credit shall be
26applied to the earliest year for which there is a tax

 

 

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1liability. If there are credits from more than one calendar
2year that are available to offset a liability, the earlier
3credit shall be applied first. This Section is exempt from the
4provisions of Section 250 of this Act.
5(Source: P.A. 96-834, eff. 12-14-09; 96-888, eff. 4-13-10;
696-905, eff. 6-4-10; 96-1027, eff. 7-12-10; 97-333, eff.
78-12-11; 97-507, eff. 8-23-11.)
 
8    Section 99. Effective date. This Act takes effect upon
9becoming law.