093_HB3677eng

 
HB3677 Engrossed                     LRB093 09306 SJM 09539 b

 1        AN ACT in relation to taxation.

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

 4        Section 5.  The Illinois Income Tax  Act  is  amended  by
 5    changing Section 1002 as follows:

 6        (35 ILCS 5/1002) (from Ch. 120, par. 10-1002)
 7        Sec. 1002.  Failure to Pay Tax.
 8        (a)  Negligence.   If  any part of a deficiency is due to
 9    negligence or intentional disregard of rules and  regulations
10    (but  without  intent to defraud) there shall be added to the
11    tax as a penalty the amount prescribed by Section 3-5 of  the
12    Uniform Penalty and Interest Act.
13        (b)  Fraud.  If any part of a deficiency is due to fraud,
14    there  shall  be  added  to  the  tax as a penalty the amount
15    prescribed by Section 3-6 of the Uniform Penalty and Interest
16    Act.
17        (c)  Nonwillful failure to pay withholding  tax.  If  any
18    employer,  without  intent to evade or defeat any tax imposed
19    by this Act or the payment thereof,  shall  fail  to  make  a
20    return  and pay a tax withheld by him at the time required by
21    or under the provisions of this Act, such employer  shall  be
22    liable  for  such  taxes and shall pay the same together with
23    the interest and the penalty provided  by  Sections  3-2  and
24    3-3,  respectively,  of  the Uniform Penalty and Interest Act
25    and such interest and penalty shall  not  be  charged  to  or
26    collected from the employee by the employer.
27        (d)  Willful  failure  to  collect and pay over tax.  Any
28    person required to collect, truthfully account for,  and  pay
29    over  the  tax  imposed  by  this  Act who willfully fails to
30    collect such tax or truthfully account for and pay over  such
31    tax  or  willfully  attempts in any manner to evade or defeat
 
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 1    the tax or the payment thereof, shall, in addition  to  other
 2    penalties  provided by law, be liable for the penalty imposed
 3    by Section 3-7 of the Uniform Penalty and Interest Act.
 4        (e)  Penalties assessable.
 5             (1)  In general. Except as  provided  in  paragraphs
 6        (2),  (3)  and  (4),  the  penalties provided by this Act
 7        shall be  paid  upon  notice  and  demand  and  shall  be
 8        assessed, collected, and paid in the same manner as taxes
 9        and  any reference in this Act to the tax imposed by this
10        Act shall be deemed also to refer to  penalties  provided
11        by this Act.
12             (2)  Procedure for assessing certain penalties.  For
13        the  purposes  of  Article  9  any  penalty under Section
14        804(a) or Section 1001 shall be deemed assessed upon  the
15        filing of the return for the taxable year.
16             (3)  Procedure for assessing the penalty for failure
17        to  file  withholding returns or annual transmittal forms
18        for wage and tax  statements.   The  penalty  imposed  by
19        Section   1004  will  be  asserted  by  the  Department's
20        issuance of a notice of deficiency.  If taxpayer files  a
21        timely  protest,  the  procedures  of Section 908 will be
22        followed.  If taxpayer does not file  a  timely  protest,
23        the  notice  of  deficiency will constitute an assessment
24        pursuant to subsection (c) of Section 904.
25             (4) Assessment of penalty under  subsection  (a)  of
26        Section 1005. The penalty imposed under subsection (a) of
27        Section  1005  for  underpayment  of  any  tax  due after
28        December 31, 2003, shall  be  deemed  assessed  upon  the
29        assessment  of  the  tax to which the penalty relates and
30        shall be collected and paid on notice and demand  in  the
31        same  manner as the tax; provided that, in the case of an
32        underpayment of tax penalty that is  imposed  only  after
33        the   expiration   of   the   30-day  period  allowed  in
34        subdivision (b-10)(2)  of  Section  3-3  of  the  Uniform
 
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 1        Penalty  and  Interest  Act,  the penalty shall be deemed
 2        assessed upon expiration of that 30-day period.
 3        (f)  Determination  of  deficiency.    For  purposes   of
 4    subsections  (a)  and (b), the amount shown as the tax by the
 5    taxpayer upon his return  shall  be  taken  into  account  in
 6    determining  the amount of the deficiency only if such return
 7    was filed on or before the last day prescribed by law for the
 8    filing of such return, including any extensions of  the  time
 9    for such filing.
10    (Source: P.A. 89-379, eff. 1-1-96.)

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