Illinois General Assembly - Full Text of HB4607
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Full Text of HB4607  102nd General Assembly

HB4607 102ND GENERAL ASSEMBLY

  
  

 


 
102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB4607

 

Introduced 1/21/2022, by Rep. Marcus C. Evans, Jr.

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 120/2a  from Ch. 120, par. 441a
35 ILCS 120/2b  from Ch. 120, par. 441b
235 ILCS 5/1-3.45 new
235 ILCS 5/7-6.5 new

    Amends the Retailers' Occupation Tax Act. Provides that, if a person who is licensed as a retailer of alcoholic liquor under the Liquor Control Act of 1934 has had the renewal of his or her certificate of registration denied or has had his or her certificate of registration revoked, the Department shall file a notice with the Liquor Control Commission that includes a certification attesting that the person's certificate of registration renewal has been denied after notice and an opportunity to be heard. Amends the Liquor Control Act of 1934. Provides that the Liquor Control Commission shall deactivate the license of any licensee authorized to sell alcoholic liquor at retail if that person's certificate of registration renewal has been denied by the Department of Revenue or revoked. Effective January 1, 2023.


LRB102 21813 HLH 33852 b

 

 

A BILL FOR

 

HB4607LRB102 21813 HLH 33852 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 Retailers' Occupation Tax Act is amended by
5changing Sections 2a and 2b as follows:
 
6    (35 ILCS 120/2a)  (from Ch. 120, par. 441a)
7    Sec. 2a. It is unlawful for any person to engage in the
8business of selling tangible personal property at retail in
9this State without a certificate of registration from the
10Department. Application for a certificate of registration
11shall be made to the Department upon forms furnished by it.
12Each such application shall be signed and verified and shall
13state: (1) the name and social security number of the
14applicant; (2) the address of his principal place of business;
15(3) the address of the principal place of business from which
16he engages in the business of selling tangible personal
17property at retail in this State and the addresses of all other
18places of business, if any (enumerating such addresses, if
19any, in a separate list attached to and made a part of the
20application), from which he engages in the business of selling
21tangible personal property at retail in this State; (4) the
22name and address of the person or persons who will be
23responsible for filing returns and payment of taxes due under

 

 

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1this Act; (5) in the case of a publicly traded corporation, the
2name and title of the Chief Financial Officer, Chief Operating
3Officer, and any other officer or employee with responsibility
4for preparing tax returns under this Act, and, in the case of
5all other corporations, the name, title, and social security
6number of each corporate officer; (6) in the case of a limited
7liability company, the name, social security number, and FEIN
8number of each manager and member; and (7) such other
9information as the Department may reasonably require. The
10application shall contain an acceptance of responsibility
11signed by the person or persons who will be responsible for
12filing returns and payment of the taxes due under this Act. If
13the applicant will sell tangible personal property at retail
14through vending machines, his application to register shall
15indicate the number of vending machines to be so operated. If
16requested by the Department at any time, that person shall
17verify the total number of vending machines he or she uses in
18his or her business of selling tangible personal property at
19retail.
20    The Department shall provide by rule for an expedited
21business registration process for remote retailers required to
22register and file under subsection (b) of Section 2 who use a
23certified service provider to file their returns under this
24Act. Such expedited registration process shall allow the
25Department to register a taxpayer based upon the same
26registration information required by the Streamlined Sales Tax

 

 

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1Governing Board for states participating in the Streamlined
2Sales Tax Project.
3    The Department may deny a certificate of registration to
4any applicant if a person who is named as the owner, a partner,
5a manager or member of a limited liability company, or a
6corporate officer of the applicant on the application for the
7certificate of registration is or has been named as the owner,
8a partner, a manager or member of a limited liability company,
9or a corporate officer on the application for the certificate
10of registration of another retailer that is in default for
11moneys due under this Act or any other tax or fee Act
12administered by the Department. For purposes of this paragraph
13only, in determining whether a person is in default for moneys
14due, the Department shall include only amounts established as
15a final liability within the 23 years prior to the date of the
16Department's notice of denial of a certificate of
17registration.
18    The Department may require an applicant for a certificate
19of registration hereunder to, at the time of filing such
20application, furnish a bond from a surety company authorized
21to do business in the State of Illinois, or an irrevocable bank
22letter of credit or a bond signed by 2 personal sureties who
23have filed, with the Department, sworn statements disclosing
24net assets equal to at least 3 times the amount of the bond to
25be required of such applicant, or a bond secured by an
26assignment of a bank account or certificate of deposit, stocks

 

 

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1or bonds, conditioned upon the applicant paying to the State
2of Illinois all moneys becoming due under this Act and under
3any other State tax law or municipal or county tax ordinance or
4resolution under which the certificate of registration that is
5issued to the applicant under this Act will permit the
6applicant to engage in business without registering separately
7under such other law, ordinance or resolution. In making a
8determination as to whether to require a bond or other
9security, the Department shall take into consideration whether
10the owner, any partner, any manager or member of a limited
11liability company, or a corporate officer of the applicant is
12or has been the owner, a partner, a manager or member of a
13limited liability company, or a corporate officer of another
14retailer that is in default for moneys due under this Act or
15any other tax or fee Act administered by the Department; and
16whether the owner, any partner, any manager or member of a
17limited liability company, or a corporate officer of the
18applicant is or has been the owner, a partner, a manager or
19member of a limited liability company, or a corporate officer
20of another retailer whose certificate of registration has been
21revoked within the previous 5 years under this Act or any other
22tax or fee Act administered by the Department. If a bond or
23other security is required, the Department shall fix the
24amount of the bond or other security, taking into
25consideration the amount of money expected to become due from
26the applicant under this Act and under any other State tax law

 

 

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1or municipal or county tax ordinance or resolution under which
2the certificate of registration that is issued to the
3applicant under this Act will permit the applicant to engage
4in business without registering separately under such other
5law, ordinance, or resolution. The amount of security required
6by the Department shall be such as, in its opinion, will
7protect the State of Illinois against failure to pay the
8amount which may become due from the applicant under this Act
9and under any other State tax law or municipal or county tax
10ordinance or resolution under which the certificate of
11registration that is issued to the applicant under this Act
12will permit the applicant to engage in business without
13registering separately under such other law, ordinance or
14resolution, but the amount of the security required by the
15Department shall not exceed three times the amount of the
16applicant's average monthly tax liability, or $50,000.00,
17whichever amount is lower.
18    No certificate of registration under this Act shall be
19issued by the Department until the applicant provides the
20Department with satisfactory security, if required, as herein
21provided for.
22    Upon receipt of the application for certificate of
23registration in proper form, and upon approval by the
24Department of the security furnished by the applicant, if
25required, the Department shall issue to such applicant a
26certificate of registration which shall permit the person to

 

 

HB4607- 6 -LRB102 21813 HLH 33852 b

1whom it is issued to engage in the business of selling tangible
2personal property at retail in this State. The certificate of
3registration shall be conspicuously displayed at the place of
4business which the person so registered states in his
5application to be the principal place of business from which
6he engages in the business of selling tangible personal
7property at retail in this State.
8    No certificate of registration issued prior to July 1,
92017 to a taxpayer who files returns required by this Act on a
10monthly basis or renewed prior to July 1, 2017 by a taxpayer
11who files returns required by this Act on a monthly basis shall
12be valid after the expiration of 5 years from the date of its
13issuance or last renewal. No certificate of registration
14issued on or after July 1, 2017 to a taxpayer who files returns
15required by this Act on a monthly basis or renewed on or after
16July 1, 2017 by a taxpayer who files returns required by this
17Act on a monthly basis shall be valid after the expiration of
18one year from the date of its issuance or last renewal. The
19expiration date of a sub-certificate of registration shall be
20that of the certificate of registration to which the
21sub-certificate relates. Prior to July 1, 2017, a certificate
22of registration shall automatically be renewed, subject to
23revocation as provided by this Act, for an additional 5 years
24from the date of its expiration unless otherwise notified by
25the Department as provided by this paragraph. On and after
26July 1, 2017, a certificate of registration shall

 

 

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1automatically be renewed, subject to revocation as provided by
2this Act, for an additional one year from the date of its
3expiration unless otherwise notified by the Department as
4provided by this paragraph.
5    Where a taxpayer to whom a certificate of registration is
6issued under this Act is in default to the State of Illinois
7for delinquent returns or for moneys due under this Act or any
8other State tax law or municipal or county ordinance
9administered or enforced by the Department, the Department
10shall, not less than 60 days before the expiration date of such
11certificate of registration, give notice to the taxpayer to
12whom the certificate was issued of the account period of the
13delinquent returns, the amount of tax, penalty and interest
14due and owing from the taxpayer, and that the certificate of
15registration shall not be automatically renewed upon its
16expiration date unless the taxpayer, on or before the date of
17expiration, has filed and paid the delinquent returns or paid
18the defaulted amount in full. A taxpayer to whom such a notice
19is issued shall be deemed an applicant for renewal. The
20Department shall promulgate regulations establishing
21procedures for taxpayers who file returns on a monthly basis
22but desire and qualify to change to a quarterly or yearly
23filing basis and will no longer be subject to renewal under
24this Section, and for taxpayers who file returns on a yearly or
25quarterly basis but who desire or are required to change to a
26monthly filing basis and will be subject to renewal under this

 

 

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1Section.
2    The Department may in its discretion approve renewal by an
3applicant who is in default if, at the time of application for
4renewal, the applicant files all of the delinquent returns or
5pays to the Department such percentage of the defaulted amount
6as may be determined by the Department and agrees in writing to
7waive all limitations upon the Department for collection of
8the remaining defaulted amount to the Department over a period
9not to exceed 5 years from the date of renewal of the
10certificate; however, no renewal application submitted by an
11applicant who is in default shall be approved if the
12immediately preceding renewal by the applicant was conditioned
13upon the installment payment agreement described in this
14Section. The payment agreement herein provided for shall be in
15addition to and not in lieu of the security that may be
16required by this Section of a taxpayer who is no longer
17considered a prior continuous compliance taxpayer. The
18execution of the payment agreement as provided in this Act
19shall not toll the accrual of interest at the statutory rate.
20    The Department may suspend a certificate of registration
21if the Department finds that the person to whom the
22certificate of registration has been issued knowingly sold
23contraband cigarettes.
24    A certificate of registration issued under this Act more
25than 5 years before January 1, 1990 (the effective date of
26Public Act 86-383) shall expire and be subject to the renewal

 

 

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1provisions of this Section on the next anniversary of the date
2of issuance of such certificate which occurs more than 6
3months after January 1, 1990 (the effective date of Public Act
486-383). A certificate of registration issued less than 5
5years before January 1, 1990 (the effective date of Public Act
686-383) shall expire and be subject to the renewal provisions
7of this Section on the 5th anniversary of the issuance of the
8certificate.
9    If a person who is licensed as a retailer of alcoholic
10liquor under the Liquor Control Act of 1934 has had the renewal
11of his or her certificate of registration denied under this
12Section 2a, then, pursuant to Section 7-6.5 of the Liquor
13Control Act of 1934, the Department shall file a notice with
14the Liquor Control Commission that includes a certification,
15signed by the Director of Revenue or his or her designee,
16attesting that the person's certificate of registration
17renewal has been denied after notice and an opportunity to be
18heard.
19    If the person so registered states that he operates other
20places of business from which he engages in the business of
21selling tangible personal property at retail in this State,
22the Department shall furnish him with a sub-certificate of
23registration for each such place of business, and the
24applicant shall display the appropriate sub-certificate of
25registration at each such place of business. All
26sub-certificates of registration shall bear the same

 

 

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1registration number as that appearing upon the certificate of
2registration to which such sub-certificates relate.
3    If the applicant will sell tangible personal property at
4retail through vending machines, the Department shall furnish
5him with a sub-certificate of registration for each such
6vending machine, and the applicant shall display the
7appropriate sub-certificate of registration on each such
8vending machine by attaching the sub-certificate of
9registration to a conspicuous part of such vending machine. If
10a person who is registered to sell tangible personal property
11at retail through vending machines adds an additional vending
12machine or additional vending machines to the number of
13vending machines he or she uses in his or her business of
14selling tangible personal property at retail, he or she shall
15notify the Department, on a form prescribed by the Department,
16to request an additional sub-certificate or additional
17sub-certificates of registration, as applicable. With each
18such request, the applicant shall report the number of
19sub-certificates of registration he or she is requesting as
20well as the total number of vending machines from which he or
21she makes retail sales.
22    Where the same person engages in 2 or more businesses of
23selling tangible personal property at retail in this State,
24which businesses are substantially different in character or
25engaged in under different trade names or engaged in under
26other substantially dissimilar circumstances (so that it is

 

 

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1more practicable, from an accounting, auditing or bookkeeping
2standpoint, for such businesses to be separately registered),
3the Department may require or permit such person (subject to
4the same requirements concerning the furnishing of security as
5those that are provided for hereinbefore in this Section as to
6each application for a certificate of registration) to apply
7for and obtain a separate certificate of registration for each
8such business or for any of such businesses, under a single
9certificate of registration supplemented by related
10sub-certificates of registration.
11    Any person who is registered under the Retailers'
12Occupation Tax Act as of March 8, 1963, and who, during the
133-year period immediately prior to March 8, 1963, or during a
14continuous 3-year period part of which passed immediately
15before and the remainder of which passes immediately after
16March 8, 1963, has been so registered continuously and who is
17determined by the Department not to have been either
18delinquent or deficient in the payment of tax liability during
19that period under this Act or under any other State tax law or
20municipal or county tax ordinance or resolution under which
21the certificate of registration that is issued to the
22registrant under this Act will permit the registrant to engage
23in business without registering separately under such other
24law, ordinance or resolution, shall be considered to be a
25Prior Continuous Compliance taxpayer. Also any taxpayer who
26has, as verified by the Department, faithfully and

 

 

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1continuously complied with the condition of his bond or other
2security under the provisions of this Act for a period of 3
3consecutive years shall be considered to be a Prior Continuous
4Compliance taxpayer.
5    Every Prior Continuous Compliance taxpayer shall be exempt
6from all requirements under this Act concerning the furnishing
7of a bond or other security as a condition precedent to his
8being authorized to engage in the business of selling tangible
9personal property at retail in this State. This exemption
10shall continue for each such taxpayer until such time as he may
11be determined by the Department to be delinquent in the filing
12of any returns, or is determined by the Department (either
13through the Department's issuance of a final assessment which
14has become final under the Act, or by the taxpayer's filing of
15a return which admits tax that is not paid to be due) to be
16delinquent or deficient in the paying of any tax under this Act
17or under any other State tax law or municipal or county tax
18ordinance or resolution under which the certificate of
19registration that is issued to the registrant under this Act
20will permit the registrant to engage in business without
21registering separately under such other law, ordinance or
22resolution, at which time that taxpayer shall become subject
23to all the financial responsibility requirements of this Act
24and, as a condition of being allowed to continue to engage in
25the business of selling tangible personal property at retail,
26may be required to post bond or other acceptable security with

 

 

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1the Department covering liability which such taxpayer may
2thereafter incur. Any taxpayer who fails to pay an admitted or
3established liability under this Act may also be required to
4post bond or other acceptable security with this Department
5guaranteeing the payment of such admitted or established
6liability.
7    No certificate of registration shall be issued to any
8person who is in default to the State of Illinois for moneys
9due under this Act or under any other State tax law or
10municipal or county tax ordinance or resolution under which
11the certificate of registration that is issued to the
12applicant under this Act will permit the applicant to engage
13in business without registering separately under such other
14law, ordinance or resolution.
15    Any person aggrieved by any decision of the Department
16under this Section may, within 20 days after notice of such
17decision, protest and request a hearing, whereupon the
18Department shall give notice to such person of the time and
19place fixed for such hearing and shall hold a hearing in
20conformity with the provisions of this Act and then issue its
21final administrative decision in the matter to such person. In
22the absence of such a protest within 20 days, the Department's
23decision shall become final without any further determination
24being made or notice given.
25    With respect to security other than bonds (upon which the
26Department may sue in the event of a forfeiture), if the

 

 

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1taxpayer fails to pay, when due, any amount whose payment such
2security guarantees, the Department shall, after such
3liability is admitted by the taxpayer or established by the
4Department through the issuance of a final assessment that has
5become final under the law, convert the security which that
6taxpayer has furnished into money for the State, after first
7giving the taxpayer at least 10 days' written notice, by
8registered or certified mail, to pay the liability or forfeit
9such security to the Department. If the security consists of
10stocks or bonds or other securities which are listed on a
11public exchange, the Department shall sell such securities
12through such public exchange. If the security consists of an
13irrevocable bank letter of credit, the Department shall
14convert the security in the manner provided for in the Uniform
15Commercial Code. If the security consists of a bank
16certificate of deposit, the Department shall convert the
17security into money by demanding and collecting the amount of
18such bank certificate of deposit from the bank which issued
19such certificate. If the security consists of a type of stocks
20or other securities which are not listed on a public exchange,
21the Department shall sell such security to the highest and
22best bidder after giving at least 10 days' notice of the date,
23time and place of the intended sale by publication in the
24"State Official Newspaper". If the Department realizes more
25than the amount of such liability from the security, plus the
26expenses incurred by the Department in converting the security

 

 

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1into money, the Department shall pay such excess to the
2taxpayer who furnished such security, and the balance shall be
3paid into the State Treasury.
4    The Department shall discharge any surety and shall
5release and return any security deposited, assigned, pledged
6or otherwise provided to it by a taxpayer under this Section
7within 30 days after:
8        (1) such taxpayer becomes a Prior Continuous
9    Compliance taxpayer; or
10        (2) such taxpayer has ceased to collect receipts on
11    which he is required to remit tax to the Department, has
12    filed a final tax return, and has paid to the Department an
13    amount sufficient to discharge his remaining tax
14    liability, as determined by the Department, under this Act
15    and under every other State tax law or municipal or county
16    tax ordinance or resolution under which the certificate of
17    registration issued under this Act permits the registrant
18    to engage in business without registering separately under
19    such other law, ordinance or resolution. The Department
20    shall make a final determination of the taxpayer's
21    outstanding tax liability as expeditiously as possible
22    after his final tax return has been filed; if the
23    Department cannot make such final determination within 45
24    days after receiving the final tax return, within such
25    period it shall so notify the taxpayer, stating its
26    reasons therefor.

 

 

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1(Source: P.A. 101-31, eff. 6-28-19; 102-40, eff. 6-25-21.)
 
2    (35 ILCS 120/2b)  (from Ch. 120, par. 441b)
3    Sec. 2b. The Department may, after notice and a hearing as
4provided herein, revoke the certificate of registration of any
5person who violates any of the provisions of this Act. Before
6revocation of a certificate of registration the Department
7shall, within 90 days after non-compliance and at least 7 days
8prior to the date of the hearing, give the person so accused
9notice in writing of the charge against him or her, and on the
10date designated shall conduct a hearing upon this matter. The
11lapse of such 90 day period shall not preclude the Department
12from conducting revocation proceedings at a later date if
13necessary. Any hearing held under this Section shall be
14conducted by the Director of Revenue or by any officer or
15employee of the Department designated, in writing, by the
16Director of Revenue.
17    Upon the hearing of any such proceeding, the Director of
18Revenue, or any officer or employee of the Department
19designated, in writing, by the Director of Revenue, may
20administer oaths and the Department may procure by its
21subpoena the attendance of witnesses and, by its subpoena
22duces tecum, the production of relevant books and papers. Any
23circuit court, upon application either of the accused or of
24the Department, may, by order duly entered, require the
25attendance of witnesses and the production of relevant books

 

 

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1and papers, before the Department in any hearing relating to
2the revocation of certificates of registration. Upon refusal
3or neglect to obey the order of the court, the court may compel
4obedience thereof by proceedings for contempt.
5    The Department may, by application to any circuit court,
6obtain an injunction restraining any person who engages in the
7business of selling tangible personal property at retail in
8this State without a certificate of registration (either
9because the certificate of registration has been revoked or
10because of a failure to obtain a certificate of registration
11in the first instance) from engaging in such business until
12such person, as if he or she were a new applicant for a
13certificate of registration, shall comply with all of the
14conditions, restrictions and requirements of Section 2a of
15this Act and qualify for and obtain a certificate of
16registration. Upon refusal or neglect to obey the order of the
17court, the court may compel obedience thereof by proceedings
18for contempt.
19    It shall not be a defense in a proceeding before the
20Department to revoke a certificate of registration issued
21under the Act, or in any action by the Department to collect
22any tax due under this Act, that the holder of the certificate
23is a party to an installment payment agreement under Section
242a of this Act if the liability which is the basis of the
25revocation proceeding, or the tax that is sought to be
26collected: (1) was incurred after the date of the agreement

 

 

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1was approved by the Department; or (2) was incurred prior to
2the date the agreement was approved by the Department, but was
3not included in the agreement; or (3) was included in the
4agreement, but the taxpayer is in default of the agreement.
5    If a person who is licensed as a retailer of alcoholic
6liquor under the Liquor Control Act of 1934 has had his or her
7certificate of registration revoked under this Section 2b,
8then, pursuant to Section 7-6.5 of the Liquor Control Act of
91934, the Department shall file a notice with the Liquor
10Control Commission that includes a certification, signed by
11the Director of Revenue or his or her designee, attesting that
12the person's certificate of registration has been revoked
13after notice and an opportunity to be heard.
14(Source: P.A. 86-338; 86-383; 86-1028.)
 
15    Section 10. The Liquor Control Act of 1934 is amended by
16adding Sections 1-3.45 and 7-6.5 as follows:
 
17    (235 ILCS 5/1-3.45 new)
18    Sec. 1-3.45. Inactive license. "Inactive" means a status
19of licensure in which the licensee holds a current license
20under this Act, but the licensee is prohibited from engaging
21in all licensed activities because the licensee does not hold
22an active certificate of registration issued by the Department
23of Revenue pursuant to the Retailers' Occupation Tax Act.
 

 

 

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1    (235 ILCS 5/7-6.5 new)
2    Sec. 7-6.5. Inactive licenses; certificate of
3registration. Notwithstanding any provision of this Act to the
4contrary, the Commission shall deactivate the license of any
5licensee authorized to sell alcoholic liquor at retail if that
6person's certificate of registration renewal has been denied
7by the Department of Revenue pursuant to Section 2a of the
8Retailers' Occupation Tax Act or that person's certificate of
9registration has been revoked by the Department of Revenue
10pursuant to Section 2b of the Retailers' Occupation Tax Act
11until the violation resulting in the nonrenewal or revocation
12has been remedied and the certificate of registration has been
13reinstated by the Department of Revenue. The Department of
14Revenue shall file a notice with the Commission that includes
15a certification, signed by the Director of Revenue or his or
16her designee, attesting that the person's certificate of
17registration renewal has been denied or the person's
18certificate of registration has been revoked, after notice and
19an opportunity to be heard.
20    If a person who is licensed as a retailer of alcoholic
21liquor under this Act has had the renewal of his or her
22certificate of registration denied under Section 2a or revoked
23under Section 2b of the Retailers' Occupation Tax Act, then,
24pursuant to this Section, distributors licensed under this Act
25are prohibited from selling alcoholic liquor to that retailer,
26that retailer is prohibited from purchasing alcoholic liquor

 

 

HB4607- 20 -LRB102 21813 HLH 33852 b

1from distributors, and all other licensed activities are
2prohibited, pending notification by the Department of Revenue
3that the nonrenewal or revocation has been resolved to the
4Department of Revenue's satisfaction.
 
5    Section 99. Effective date. This Act takes effect January
61, 2023.